MSP Definitions - JF Part A
|An individual charge determination (approved amount) made by a carrier on a covered Part B or Part A medical service or supply.
|The portion of reimbursable hospital and medical expenses, after subtraction of any deductible, that Medicare does not cover and for which the beneficiary is responsible; or, for which Medicaid may pay in the case of certain dually entitled beneficiaries. Under Part A (Hospital Insurance [HI]), there is no coinsurance for the first 60 days of inpatient hospital care; from the 61st-90th day of inpatient care, the daily coinsurance amount is equal to one-fourth of the inpatient hospital deductible. For each of the 60 lifetime reserve days used, the daily coinsurance amount is equal to one-half of the inpatient hospital deductible. There is no coinsurance for the first 20 days of Skilled Nursing Facility (SNF) care; from the 21st-100th day of SNF care, the daily coinsurance amount is equal to one-eighth of the inpatient hospital deductible. Under Part B (Supplementary Medical Insurance [SMI]), after the annual deductible has been met, Medicare pays 80 percent of reasonable charges for covered services and supplies; the remaining 20 percent of reasonable charges are the coinsurance payable by the enrollee. However, there is no coinsurance for home health services or for clinical laboratory services under SMI.
|The Consolidated Omnibus Budget Reconciliation Act of 1985.
|A Medicare payment for services for which another insurer is primary payer.
|Conditional Primary Medicare Benefits
|Except in the situations described in subsection 2, conditional primary Medicare benefits may be paid if:
|The amount paid by enrollees or by a third party for covered services before Medicare makes reimbursements. The Medicare HI deductible applies to each new benefit period, is determined each year by a formula specified by law, and approximates the current cost of a 1-day inpatient hospital stay. The Medicare SMI deductible is, by law, the first $100 of covered charges.
|One of the categories used for classifying Medicare enrollees and those eligible for Medicaid. Under Medicare, disabled under age 65 receiving Social Security or Railroad Retirement Board disability insurance benefits for 24 months are eligible for Medicare. Individuals under age 65 who are diagnosed with End Stage Renal Disease (ESRD) are also eligible to receive Medicare benefits and are included with the disabled unless otherwise noted. Medicaid refers to low-income individuals of any age who are eligible as persons meeting the Social Security Administration's (SSA's) programmatic definition of disability. This includes individuals receiving Social Security Income (SSI as well as those whose income is too high for SSI but qualifies under separate Medicaid income standards.
|End Stage Renal Disease (ESRD)
|Medicare is secondary to GHPs (without regard to the number of individuals employed and irrespective of current employment status) that cover individuals who have ESRD. GHPs are always primary payers throughout the first 30 months of ESRD based Medicare eligibility or entitlement.
|Group Health Plan (GHP)
|Any arrangement of, or contributed to by, one or more employers, or employee organizations, to provide health benefits or medical care directly or indirectly to current or former employees, the employer, others associated or formerly associated with the employer in a business relationship, or their families. An arrangement by more than one employer is considered to be a single plan if it provides for common administration of the health benefits (e.g., by the employers directly or by a benefit administrator or by a multi-employer trust or by an insuring organization under a contract or contracts).
A plan that does not have any employees or former employees as enrollees (e.g., a plan for self-employed persons only) does not meet the definition of a GHP, and Medicare is not secondary to it. Thus, if an insurance company establishes a plan solely for its self-employed insurance agents, other than full-time life insurance agents, the plan is not considered a GHP. However, if the plan includes full-time life insurance agents or other employees or former employees, it is considered a GHP.
The term "GHP" includes self-insured plans, plans of governmental entities (Federal, State and local, such as the Federal Employees Health Benefits Program), and employee organization plans. Examples of the latter are union plans and employee health and welfare funds. Employee-pay-all plans are also included (i.e., GHPs that are under the auspices of one or more employers or employee organizations but do not receive any contribution from the employer). However, coverage under the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) is secondary to Medicare since the law makes Medicare primary to CHAMPUS.
Any health plan (including a union plan) in which a beneficiary is enrolled because of his/her own employment or a family member's employment meets this definition.
|Large Group Health Plan (LGHP
|A GHP that covers employees of either:
|Liability insurance (including a self-insured plan) provides payment based upon a legally established responsibility for injury, illness, or damage to property. This includes, but is not limited to, automobile liability, uninsured and under-insured motorist, homeowner's liability, malpractice, product liability, and general casualty insurance. It may also include payments under state "wrongful death" statutes that provide payment for medical damages.
|Medicare Secondary Payer (MSP)
|The term used by Medicare when a party is responsible for making a primary payment. (The private insurance industry generally talks about Coordination of Benefits when assigning responsibility for primary and secondary payment.)
|Medical Payments Coverage (Med-Pay)
|A payment made by an insurer intended specifically to pay for medical expenses without regard to the fault of any part to the accident. Med-Pay is a form of no-fault insurance. In these situations, Medicare's proportionate share of procurement costs are not deducted from this payment unless the claim was contested.
|Medicare is secondary to any no-fault insurance, including automobile medical and non-automobile no-fault insurance.
|Obligated to Accept Field (OTAF)
|This is the amount the provider agreed to accept from the primary payer when the amount is less than the charges but higher than the payment amount; then a Medicare secondary payment is due to the provider. There is not a specific column or area on an EOB that indicates the OTAF amount. However, this amount is determined by other information that is listed on the EOB, such as discount, provider write-off, withholding, risk amount, service benefit credit, contractual adjustment, provider agreement, negotiated savings, or an amount that the beneficiary is not liable for. If the beneficiary were not responsible for any of these amounts, then the OTAF amount would be the same as the amount the primary insurance paid. Using an OTAF amount will indicate that there is a discount that the beneficiary was not responsible for. This may have to be manually calculated, by taking the billed amount minus the discounts/adjustments to calculate the OTAF.
|With regard to liability, wc or no fault insurance is a payment made within 120 days after the earlier of the following:
|A claim that is filed timely and meets all other claims filing requirements specified by the TPP.
|Used to characterize Medicare benefits, meaning benefits that are payable only to the extent that payment has not been made and cannot reasonably be expected to be made by a TPP that is primary to Medicare.
|Third Party Liability (TPL)
|The legal obligation of third parties, i.e., certain individuals, entities, or programs, to pay all or part of the expenditures for medical assistance furnished under a State plan. The Medicaid program by law is intended to be the payer of last resort; that is, all other available third party resources must meet their legal obligation to pay claims before the Medicaid program pays for the care of an individual eligible for Medicaid. Examples of third parties which may be liable to pay for services include private health insurance, Medicare, employment-related health insurance, court-ordered health insurance derived by non-custodial parents, court judgments or settlements from a liability insurer, workers' compensation, first party probate-estate recoveries, long-term care insurance, and other State and Federal programs (unless specifically excluded by Federal statute).
Individuals eligible for Medicaid assign their rights to third party payments to the State Medicaid agency. States are required to take all reasonable measures to ascertain the legal liability of third parties to pay for care and services available under the State plan. Once States have determined that a potentially liable third party exists, the State is required to either "cost avoid" or "pay and chase" claims. Cost avoidance is where the provider of services bills and collects from liable third parties before sending the claim to Medicaid. Pay and chase is utilized when the State Medicaid agency pays the medical bills and then attempts to recover from liable third parties. States are generally required to cost avoid claims unless they have a waiver approved by CMS which allows them to use the pay and chase method.
|A WC law or plan, automobile or non-automobile no-fault insurance, any liability insurance, or a GHP or LGHP that is required to pay primary to Medicare.
|The used amount. Specifically, when Medicare conditional payments are recovered, the services paid conditionally are not counted against the number of inpatient care days available to the beneficiary. If an individual is hospitalized twice in the same benefit period and Medicare recovers its payment from the liability insurance for the first hospitalization, the first hospitalization would not be charged to the beneficiary.
|Medicare is secondary to group health plans (GHPs) of employers and employee organizations, including multi-employer and multiple employer plans which have at least one participating employer that employs 20 or more employees. Medicare is secondary for Medicare beneficiaries age 65 or older who are covered under the plan by virtue of his or her own current employment status with an employer or the current employment status of a spouse of any age.
|Medicare is secondary to large group health plans (LGHPs), i.e., plans of employee organizations and employers when at least one of the employers employs at least 100 employees. Medicare is secondary for Medicare beneficiaries who are under age 65, entitled to Medicare on the basis of disability, and are covered under the plan by virtue of their own or a family member's current employment status with an employer.
|Insurer that becomes primary when the injured party sustained his or her injury during employment. Medicare is secondary to WC plans (including black lung benefit programs) of the States and the United States.