Title 10 U.S.C. '1095 authorizes Department of Defense (DoD) to collect from third party payers for reasonable cost of care, less appropriate deductibles or co-payments, incurred on behalf of non-active duty DoD beneficiaries with health insurance. The law, however, excludes collection of payment in the case of a plan administered under title XVIII or XIX of the Social Security Act. In other words, Medicare/Medicaid claims for DoD beneficiaries are statutorily prohibited by 10 U.S.C. '1095.
The 10 U.S.C. '1095 prohibition regarding plans administered under Title XVIII (Medicare) also applies to Medicare alternative products and Medicaid. The Balanced Budget Act of 1997 amended the Social Security Act and established a new Medicare Part C, referred to as the Medicare + Choice Program. The new Medicare alternative options include coordinated care plans such as Provider Sponsored Organizations (PSOs), Provider Service Networks (PSNs), Social Health Maintenance Organization (SHMOs), certain religious fraternal benefit society plans, and Medicare Medical Savings Accounts (MSAs). These new options are expected to be implemented slowly beginning in 1999. These Medicare alternative plans are not Medigap (Medicare supplemental) plans.
While Military Training Facility's may not collect Medicare payments from beneficiaries, there are, however, certain situations where Military Treatment Facilities (MTFs) can collect from third party payers for Medicare/Medicaid eligible, non-active duty DoD beneficiaries and civilian emergency patients. These situations will be addressed below:
How is Medicare treated in relation to private health insurance and Medicare supplemental insurance for hospital beneficiaries?
If a non-active duty DoD beneficiary, who is Medicare eligible and is working or whose spouse is working, receives care at an Medical Training Facility, the Medical Training Facility will bill the Employer Group Health Plan (EGHP) at the full rate. The EGHP would be the primary payer and Medicare the secondary. However, as stated above, Medicare cannot be billed for the amount unpaid by the EGHP in this instance. The Third Party Collection Program Patient Category would be indicated using 31 or 43 (retiree and family member, respectively) with the prefix determined by the beneficiary's branch of Service.
In addition, Medicare Supplemental insurers are required by law to accept Third Party Collections claims as involving Medicare-covered services. They cannot deny a Third Party Collections claim on the grounds that no claim had been submitted previously by the provider or beneficiary for payment under Medicare. The obligation of a Medicare supplemental plan to pay shall be determined as if the Military Training Facility were a Medicare-eligible provider and the provided services as if they were Medicare-covered services. In general, Medicare supplemental plans are responsible for paying amounts comparable to beneficiary out-of-pocket costs under normal operation of the Medicare program. Currently, efforts to collect from Medicare supplemental policies for covered services, with the exception of inpatient Medicare Part A deductible amounts, are deferred. The obligation to pay the Medicare inpatient deducible amount only applies to Medicare supplemental policies that cover the inpatient deductible.
For more information regarding other health insurance coverage visit Third Party Collections.
Medicare/Medicaid for non-beneficiaries
In the case of a civilian Emergency Room patient covered as a Medicare eligible, the claim falls under Medical Services Account. The applicable full charge for the service should be reflected on the EGHP claim if the beneficiary is working. If the primary insurance carrier pays only a portion of a claim, the Military Training Facility can bill Medicare the difference up to the Interagency Rate (IAR). This difference would need to be calculated manually.
When billing under Medical Services Account, a non-DoD Medicare eligible beneficiary, who is not actively employed and has no primary employer group health plan, may have a Medicare supplemental insurance or may be covered by the retiree's previous employer's group plan that pays limited benefits. In this instance, Medicare is the primary payer and the insurance pays supplemental benefits. If Medicare were primary, the Military Training Facility would bill Medicare at the Interagency Rate (IAR). If the Medicare eligible beneficiary were enrolled under the Medicare Risk HMO, the Military Training Facility would also bill the HMO at the Interagency Rate (IAR).
The civilian Emergency Room patient is held solely responsible for the payment of their charges. As a courtesy to the patient, the Military Training Facility may bill their insurance.