Current through Register Vol. 49, No. 9, September, 2024
I. Introduction: The Arkansas Division of
Medical Services (DMS) may pay for health insurance premiums for Medicaid
eligible individuals if such payments are cost effective. This chapter contains
the rules governing premium payments under the Arkansas Health Insurance
Premium Payment (HIPP) program.
II.
Definitions
a. Cost Effectiveness: Health
insurance premium payments are cost effective if the premiums, coinsurance,
deductibles and other cost sharing obligations under a health plan, plus an
amount for administrative costs are likely to be less than the amount paid for
equivalent Medicaid services. HIPP is
not cost effective when:
(1) Private insurance premiums are used to
meet a spend down obligation under the medically needy program;
(2) The client's eligibility category is
"aged."Covered Benefits: Medical assistance as defined in § 1905 of the
Social Security Act that is covered under the State Medicaid Plan and any
additional services covered under a waiver approved by the Secretary of the
Department of Health and Human Services.
b. Equivalent Services: Health care treatment
and services that correspond with covered benefits.
c. Family Members: DMS may choose to enroll
family members into the health plan who are not Medicaid eligible if cost
effective. For Medicaid ineligible family members, DMS covers payment only for
the premiums. Other cost sharing expenses are not covered. The family member
may reside in a different household.
d. Group Health Plan: Any plan of, or
contributed to by, an employer (including a self-insured plan) to provide
health care (directly or otherwise) to the employer's employees, former
employees, or the families of employees or former employees. A group health
plan must meet S. 5000(b)(1) of the Internal Revenue Code of 1986, and includes
continuation coverage pursuant to Title XXII of the Public Health Services Act,
S. 4980B of the Internal Revenue Code of 1986, or Title VI of the Employee
Retirement Income Security Act of 1974.
e. Health Plan: Any health insurance plan
that, in exchange for premiums paid pays benefits for medical services.
Medicare Part B premiums are excluded.
f. HIPP: The Health Insurance Premium Payment
program.
g. MMIS: The Medicaid
Management Information System.
h.
Premium Cost: The premium cost is determined by applying a premium factor for
the percentage of clients who would receive services compared to those eligible
for Medicaid. This accounts for Arkansas's costs being based on "per client"
data instead of "per eligible" data.
III. HIPP program: DMS may cover payment of
premiums for Medicaid beneficiaries enrolled in a cost effective health plan.
DMS may also cover payment of deductibles, co-insurance, and other cost sharing
obligations under the health plan if the services are included in the State
Plan and provided to a Medicaid beneficiary.
IV. Medicaid Eligibility Unaffected:
a. Enrollment in a health plan does not
change the client's eligibility for Medicaid benefits. If services covered
under Medicaid are not covered by the health plan, payment for those services
is made according to the applicable Medicaid payment methodology. If the
client's health plan offers more services than covered under Medicaid, DMS does
not pay for the deductibles, coinsurance, and other cost sharing obligations
for those non-covered services.
b.
Medicare Enrollment: If the client is also eligible for Medicare Part B but is
not enrolled in Medicare Part B, DMS does not pay for the premiums or cost
sharing obligations to the health plan unless cost effective.
c. Medicaid Cost Sharing Amounts: If the
client is required to pay Medicaid cost sharing amounts, payment of the cost
sharing amounts is not covered by the HIPP Program.
V. Third Party Liability: The health plan is
considered to be a third party that is legally liable for the payment of care
and services provided under the State Medicaid Plan.
VI. Enrollment:
a. Health plans usually limit an individual's
enrollment period. If an individual who is already enrolled in a health plan
becomes Medicaid eligible, DMS may cover premium payments as of the effective
date of Medicaid eligibility.
b.
Effective Date of Benefit: If a client is not eligible for coverage under a
health plan for a specified waiting period, DMS may cover the premium as of the
effective date of eligibility for the health plan. Until the client is eligible
to enroll or entitled to receive services under the health plan, all
Medicaid-covered services are covered and paid under the usual Medicaid
policies and procedures.
c. Delayed
Enrollment: If the availability for enrollment in the health plan and
eligibility for Medicaid do not coincide, the client/applicant shall apply for
HIPP eligibility. The client/applicant will be enrolled in the health plan when
eligible if still cost effective.
d. Annual Renewal: Cost effectiveness shall
be reviewed at least annually. At least 6 months of claims or EOBs will be
reviewed during the renewal period. The annual renewal may coincide with the
employer's open enrollment period for employer sponsored plans.
VII. Cost Effectiveness
Determination: DMS determines the cost effectiveness of health plans using the
following methodology:
a. The Medicaid client
furnishes information on the health plan to DMS. This information must include
the effective date of the policy, exclusions to enrollment, the covered
services under the policy, riders and exclusions of covered services, and
premiums paid by the policy owners.
b. Using the Medicaid Management Information
System (MMIS), DMS obtains the total 12 month estimated average
inflation-adjusted Medicaid costs for persons comparable to the client with
respect to age, sex, and category data.
c. DMS:
(1)
Determines (if historical data is available) or estimates (if historical data
is unavailable) the total 12 months Medicaid expenditures for covered services
(estimated average Medicaid cost);
(2) Identifies equivalent services covered by
the private insurance;
(3)
Identifies the premium cost;
(4)
Determines the cost of any covered services for which the private insurance
does not provide equivalent coverage;
(5) Estimates the cost of coinsurance and
deductibles up to the Medicaid allowable amounts; and
(6) Determines the administrative cost to
Medicaid for processing the health plan information by determining the average
increase in cost per client for at least a 12 month Period.
(7) DMS determines the cost of HIPP by adding
the amounts identified in § (c)(3)-(6) and compares that cost to the
estimated average Medicaid costs. If the cost of the HIPP case is less than the
estimated average Medicaid costs, the health plan is cost effective. If the
cost of the HIPP case is equal to or greater than the estimated average
Medicaid costs, the health plan is not cost effective.
VIII. Exceptional Medical Costs
(Special Conditions): If the client provides documentation of on-
going medical costs or future medical costs that exceed the
estimated average Medicaid costs, DMS may determine that the health plan is
cost effective.
IX. Balance
Billing: DMS pays only up to the Medicaid allowable amount. For example, if a
provider bills $50 for a service and the insurer pays $40, but the Medicaid
allowable is $37, Medicaid will not make up the $10 difference between the
billed amount and the insurance payment; NOR CAN THE PROVIDER BILL THE CLIENT
for the difference. If the provider bills $50 and the insurance pays $37 and
the Medicaid allowable is $40, Medicaid can pay the difference, up to the
Medicaid allowable - in this case, Medicaid pays $3. In both examples, THE
PROVIDER CANNOT BILL THE CLIENT FOR THE DIFFERENCE BETWEEN THE MEDICAID PAYMENT
AND THE BILLED AMOUNT.
X. Payment
for Services:
a. DMS will pay the health
insurance premium directly to the policyholder or designated party through
premium payment from payroll deduction or individual plans.
b. DMS will reimburse the policyholder or the
financially responsible party for the payroll deduction made for health
insurance premiums, and for coinsurance and deductibles subject to the
limitations in § IX.
