Clarifying Cut to Medicaid Payment of Medicare Cost Sharing

The July 2016 issue of the Department of Health (DOH) Medicaid Update and an August eMedNY LISTSERV message discussed a 2016-17 State Budget provision that caps Medicaid co-insurance and co-payments for services provided to individuals eligible for both Medicare and Medicaid who are enrolled in Medicare managed care (i.e., Medicare Part C or Medicare Advantage). When implemented, this provision will reduce these Medicaid payments to 85 percent of the co-insurance or co-payment amounts that would otherwise be borne by a Medicare beneficiary not eligible for Medicaid.

These publications reported incorrectly that the provision is effective retroactively to April 1, 2016. Furthermore, with the reference to “institutional” claims being included in the reduction, LeadingAge NY was concerned that skilled nursing facility (SNF) coinsurance for days 21-100 of a SNF stay could also be affected.

LeadingAge NY raised these issues with DOH, and we are pleased to report that the effective date of this provision is, in fact, July 1, 2016. Furthermore, this reduction will only be applied to outpatient (i.e., Medicare Part B) services covered through a Medicare Part C plan. It will not affect SNF coinsurance amounts applied to days 21-100 of a SNF stay. These issues will be clarified in the August issue of the DOH Medicaid Update.

Limitations on Medicaid payment of Medicare cost-sharing for dually eligible individuals covered by fee-for-service Medicare Part B were enacted and implemented during 2015.

Contact: Dan Heim, dheim@leadingageny.org, 518-867-8866