Medicare Part D Late Enrollment Penalty

[G.Gordon]

Hey.. Yoda of Moronis. I have one MA on the books. That represents < .01% of my senior business. You're an assumptive ass.

So where did you earn your actuarial degree? Do you know what an actuary is? Do you understand actuarial science?

google it... mkay?

So you "know" beyond a shaddow of a doubt that the current trend is what will continue down the road? What information leads you to that "assumption"? Past trends? Well isn't that ignorant of what changes in regulation or model law might be in the works?

Geeezz!! I'm scared to death for your clients.

 

[jdeasy]

I beg to differ.
The National Average differs each year. If you do not have creditable coverage during any of these years, the 1% penalty is based on the National Average during that specific year.
You do not use the current National Average and applying it to prior years.

Where do you get that info? I believe that G. Gordon is correct as that is how I was taught. However, if you have something to support the way you are figuring, I would like to see it.

 

[G.Gordon]

I beg to differ.
The National Average differs each year. If you do not have creditable coverage during any of these years, the 1% penalty is based on the National Average during that specific year.
You do not use the current National Average and applying it to prior years.

Sorry, but I'm right. I have clients that have penalties that reflect all months without coverage mulitplied by the current National Average for the standard premium. So if someone hasn't had coverage and enrolls for 1/1/2010 they carry 42 months by .32 or $13.44.

I have real life examples and have seen it apply. That trumps assumption. Plus... read page 67 and that makes it pretty clear with what I've experienced.

 

[DS4]

G. Gordon,
You are correct!
I found a CMS memo,

"Calculation, Billing, and Collection of the LEP

The LEP is assessed as 1% of the national base beneficiary premium for the coverage year times the total number of uncovered months, regardless of the year(s) in which those months occurred. The national base beneficiary premium is not the Part D plan sponsor’s premium, but is a national amount that is a function of the national average bid for the year in which the beneficiary is enrolled in a Part D plan sponsor. Therefore, even if there is no change in the number of uncovered months, the LEP may change each year because it is recalculated using the total number of uncovered months and the national base beneficiary premium for that particular year.
Due to systems constraints, the LEP is rounded to the nearest ten cents"

I will now retire for the evening and eat my crow in peace.

 

[G.Gordon]

BBQ or stir fried?


Great memo. Thanks for sharing. I've not seen that.

 

[DS4]

BBQ or stir fried?

Baked with a hint of lime

 

[Yoda]

GORDON SAID- "Hey.. Yoda of Moronis. I have one MA on the books. That represents < .01% of my senior business. You're an assumptive ass."
================================================

I sincerely apologize to you for implying in any way that you are dealing in WMD"s er I mean MA's. I even apologize for taking so long to apologize. To falsely accuse someone of selling those S.O.B.s er I mean those MA's is a horrible thing to do.

 

[retread]

G. Gordon,
You are correct!
I found a CMS memo,

"Calculation, Billing, and Collection of the LEP

The LEP is assessed as 1% of the national base beneficiary premium for the coverage year times the total number of uncovered months, regardless of the year(s) in which those months occurred. The national base beneficiary premium is not the Part D plan sponsor’s premium, but is a national amount that is a function of the national average bid for the year in which the beneficiary is enrolled in a Part D plan sponsor. Therefore, even if there is no change in the number of uncovered months, the LEP may change each year because it is recalculated using the total number of uncovered months and the national base beneficiary premium for that particular year.
Due to systems constraints, the LEP is rounded to the nearest ten cents"

I will now retire for the evening and eat my crow in peace.

You beat me to it, but I'm glad this was posted. BTW, it is good for an agent to make an estimate, but only Medicare makes the calculation. For MAPD plans, it is then given to the carrier to collect.

As far as future planning is concerned, if the beneficiary never applies for a PDP, he won't have anything to pay. That is possible, but unlikely. The older we get, the more likely we'll need drugs. In this day and age, some of us are only alive due to chemistry. The idea of him going back to Original Medicare (and, of course a Sup) is one scenario to avoid an LEP. The other is to qualify for LIS when his income drops close to FPL, or gets Medicaid.

 

[arnguy]

Yoda, you are making quite a leap of faith to state that my friend should go to a Med Supp instead of an MA. In the Philadelphia meropolitan area the MA is a huge seller---even with increased premiums. Med Supps have been extremely hard to sell in urban areas because of the extra benefits MAs offer. That may change in the future, but for now he will stay with a MA. He is eligible for VA medical coverage and I am trying to persuade him to apply inasmuch as it is creditable coverage without any penalty. Also, there is no doughnut hole with VA prescription coverage.

 

[JaBrooklyn]

Sorry to bring up an old thread. I have a client that had wellcare last year and I switched him to United for Jan 1 enrollment date.

Wellcare DID NOT send him a bill for CMS late enrollment, but now United is asking for $35 a year. Could this be a mistake and why did Wellcare also not ask to collect the penalty? Client is pissed, but I am trying to explain that its CMS and not United...

Thanks