Bulletin on Interaction Between Medicare and Small Group Health Plans

On November 27, 2019, the Bureau of Insurance published Bulletin 440, which is meant to remind small group health carriers of the importance of providing employers and health plan enrollees with accurate information relating to Medicare, especially when the employer has fewer than 20 employees. According to the bulletin, Medicare is secondary to group coverage for active employees (and their spouses) if the employer has 20 or more employees. However, if the employer has fewer than 20 employees, Medicare is primary and the employer’s plan is secondary. This results in the carrier coordinating benefits, so that its responsibility for payment cannot exceed the portion of the bill that Medicare does not pay.

In addition, Maine law also permits carriers to coordinate benefits if the employee is eligible for Medicare but did not enroll in Part B. As a result, if the employee is Part B-eligible, but chooses to delay enrollment, and the group has fewer than 20 employees, the group plan may decline to cover any portion of a bill that Part B would cover, as long as the insured employee, retiree, or dependent has received prominent notice (which must be both in the certificate of coverage and when the insured becomes eligible for Medicare due to age). Carriers must clearly articulate in plain, unambiguous language whether the carrier is the primary or secondary payer for Medicare-eligible individuals and provide examples to explain the difference (if any) for actively employed individuals and retirees covered under the small group plan.

The bulletin contains no new employer compliance obligations; but employers with small group plans sitused in Maine should be aware of the coordination rules, and the carrier’s obligation to distribute notices.

Bulletin 440 »