Employer Group Waiver Plans EGWPs Marty Abeln – Part C Kathryn Jansak – Part D September 5, 2012 Image of 5 medical staff CMS logo

Statutory Waiver Authority for MAOs Section 1857(i) of the Social Security Act: [Medicare Advantage] Program Compatibility with Employer or Union Group Health Plans – (1) CONTRACTS WITH MA ORGANIZATIONS – To facilitate the offering of [Medicare Advantage] plans under contracts between [Medicare Advantage] organizations and employers, labor organizations, or the trustees of a fund established by one or more employers or labor organizations (or combination thereof) to furnish benefits to the entity’s employees, former employees (or combination thereof) or members or former members (or combination thereof) of the labor organizations, the Secretary may waive or modify requirements that hinder the design of, the offering of, or the enrollment in such [Medicare Advantage] plans 2

Statutory Waiver Authority for Part D Section 1860D-22(b) of the Social Security Act: Application Of MA Waiver Authority — The provisions of section 1857(i) shall apply with respect to prescription drug plans in relation to employment- based retiree health coverage in a manner similar to the manner in which they apply to an MA plan in relation to employers, including authorizing the establishment of separate premium amounts for enrollees in a prescription drug plan by reason of such coverage and limitations on enrollment to part D eligible individuals enrolled under such coverage 3

Chapter 9 Updated for 2012 Chapter 9 of the Medicare Managed Care manual (Employer/Union Sponsored Group Health Plans) recently updated to include all Part C waivers Update to Chapter 12 of the Prescription Drug Benefit manual coming soon 4

Two EGWP Categories Two basic categories of EGWPs: “800 series” EGWPs – plans offered by third parties (PDPs and MA organizations) to employer and union group sponsors. Employer contracts with a third party which in turn functions as the plan sponsor (Represents majority of EGWPs) Direct Contract EGWPs (“E contracts”) – plans offered by employers or unions that directly contract with CMS to become PDP sponsors or MA organizations for their members 5

Definitions EGWPs – Employer Group Waiver Plans: EGWPs are employer-only MA plans (800 series) that may take advantage of CMS waivers to provide Part C and/or Part D benefits to Medicare beneficiaries EGHPs – Employer Group Health Plans: Employer plans offered through individual MA plans (see Chapter 9, Sections 10.2, ) These plans do not qualify for waivers available to employer only (800 series) MA plans 6

Definitions (cont’d) Employment-based Coverage - Employer group plans cannot be used to enroll association group members when there is no “employment-based” coverage provided (see Chapter 9, Section 30.1) 7

Eligibility Enrollees of both EGHPs and EGWPs must qualify for Part C and D coverage In order for a beneficiary to be eligible to enroll in an EGHP or EGWP, he or she must permanently reside in the defined service area of the plan 8

Enrollment EGHPs and EGWPs may enroll via Group Enrollment Mechanism – Must include an opt-out process with advance notification requirements – Section in Ch. 2 and Ch. 3 EGHP Special Enrollment Period – Enroll in EGHPs during time periods specified by employer – May disenroll from EGHPs at any time – Always in effect for enrollees of EGHPs – Ends two months after loss of coverage or notification 9

Same Rights and Protections Beneficiaries in EGWPs and EGHPs are entitled to all rights and protections (e.g., Medicare grievance and appeals processes) that are available to enrollees in individual MA and PDP plans 10

Final Rule: 4157-FC on EGWPs (77 Fed Regs 22072, April 12, 2012) II.A.1.f(4) Coverage Gap Discount Program Clarifies that all supplemental benefits offered by employer group waiver plans are considered other, non-Medicare health coverage always paid after the discount has been applied 11

Final Rule: 4157-FC on EGWPs (77 Fed Regs 22072, April 12, 2012) (cont’d) II. E.10 Employer Group Waiver Plans Requirement to Follow All Part D Rules Not Explicitly Waived – Underscores that, regardless of CMS waiver of certain requirements (such as benefit package review), all EGWPs must meet all other Part D requirements unless explicitly waived or modified by CMS 12

RDS conversion to EGWPs More RDS plans converting to EGWPs – Recent change in the law 13

Total 2012 MA Plan Enrollment – 13.7 Million Employer and Non Employer 14

Total 2012 PDP Enrollment – 19.9 Million Employer and Non Employer 15

2010 – 2012 MA Employer Plan Counts and Enrollment Number Plans by Year bar chart and data table HMO HMOPOS Local PPO Regional PPO PFFS MSA7322 Enrollment in 1000s bar chart and data table HMO HMOPOS Local PPO Regional PPO PFFS MSA

2008 – 2012 Employer PDP Enrollment 17

Resources Guidance References : Medicare Managed Care Manual Chapters Chapter 2 – Medicare Advantage Enrollment and Disenrollment (Updated August 2012) Enrollment/MedicareMangCareEligEnrol/Downloads/FINAL MAEnrollmentandDisenrollmentGuidanceUpdateforCY2012- Revised872012forCY2013.pdfhttp:// Enrollment/MedicareMangCareEligEnrol/Downloads/FINAL MAEnrollmentandDisenrollmentGuidanceUpdateforCY2012- Revised872012forCY2013.pdf Chapter 4 – Benefits and Beneficiary Protections (Updated June 2012) Guidance/Guidance/Manuals/Downloads/mc86c04.pdfhttp:// Guidance/Guidance/Manuals/Downloads/mc86c04.pdf Chapter 9 – Part C - Employer/Union Sponsored Group Health Plans (Updated June 2012) Plans/HealthPlansGenInfo/index.htmlhttp:// Plans/HealthPlansGenInfo/index.html 18

Resources Guidance References: Coverage/PrescriptionDrugCovContra/PartDManuals.html Prescription Drug Benefit Manual Chapter 2 PDP – Eligibility, Enrollment, and Disenrollment Chapter 12 – Part D - Employer/Union Sponsored Group Health Plans Part D EGWP website Coverage/PrescriptionDrugCovContra/PartD-EGWP.html 19

Contacts Part C – Marty Abeln Part D – Kathryn Jansak 20