§1396e–1 — Title 42 The Public Health and Welfare | U.S. Code

Summary

States may choose to pay part or all of the employee share of an employer health plan for people who get Medicaid. A State can do this only if it follows the rules here and if the subsidy is cost-effective under section 1397ee(c)(3)(A). The employer plan must be a group plan that meets creditable coverage rules in section 2701(c)(1) of the Public Health Service Act, have the employer pay at least 40% of the premium, and be offered in a nondiscriminatory way under section 105(h) of the Internal Revenue Code. Plans that are just a health flexible spending account or a high-deductible health plan (as defined in IRC sections 106(c)(2) and 223(c)(2)) are not allowed. The State must treat the employer coverage as a third-party payer under section 1396a(a)(25). The “premium assistance subsidy” is the amount the person or their family would pay to enroll. The subsidy counts as payment for medical assistance under section 1396b(a). Employers do not have to take part and may opt out of getting payments on behalf of employees. Individuals (or their parents for children under 19) must choose to get the subsidy. A State cannot force people to accept it or to enroll in employer coverage to keep their Medicaid. The State must let people drop the employer plan. If a State uses these subsidies, it must pay the enrollee premiums and any deductibles, coinsurance, or other cost-sharing for services covered by the State plan (beyond limits in sections 1396o or 1396o–1). Enrolling in employer coverage does not change Medicaid eligibility, except that payments are first billed to that coverage under section 1396a(a)(25).

Title 42, §1396e–1

The Public Health and Welfare — Source: USLM XML via OLRC

(a)A State may elect to offer a premium assistance subsidy (as defined in subsection (c)) for qualified employer-sponsored coverage (as defined in subsection (b)) to all individuals who are entitled to medical assistance under this subchapter (and, in the case of an individual under age 19, to the parent of such an individual) who have access to such coverage if the State meets the requirements of this section and the offering of such a subsidy is cost-effective, as defined for purposes of section 1397ee(c)(3)(A) of this title.

(b)(1)Subject to paragraph (2)),11 So in original. The second closing parenthesis probably should not appear. in this paragraph, the term “qualified employer-sponsored coverage” means a group health plan or health insurance coverage offered through an employer—

(A)that qualifies as creditable coverage as a group health plan under section 2701(c)(1) of the Public Health Service Act; 22 See References in Text note below.

(B)for which the employer contribution toward any premium for such coverage is at least 40 percent; and

(C)that is offered to all individuals in a manner that would be considered a nondiscriminatory eligibility classification for purposes of paragraph (3)(A)(ii) of section 105(h) of the Internal Revenue Code of 1986 (but determined without regard to clause (i) of subparagraph (B) of such paragraph).

(2)Such term does not include coverage consisting of—

(A)benefits provided under a health flexible spending arrangement (as defined in section 106(c)(2) of the Internal Revenue Code of 1986); or

(B)a high deductible health plan (as defined in section 223(c)(2) of such Code), without regard to whether the plan is purchased in conjunction with a health savings account (as defined under section 223(d) of such Code).

(3)The State shall treat the coverage provided under qualified employer-sponsored coverage as a third party liability under section 1396a(a)(25) of this title.

(c)In this section, the term “premium assistance subsidy” means the amount of the employee contribution for enrollment in the qualified employer-sponsored coverage by the individual or by the individual’s family. Premium assistance subsidies under this section shall be considered, for purposes of section 1396b(a) of this title, to be a payment for medical assistance.

(d)(1)Participation by an employer in a premium assistance subsidy offered by a State under this section shall be voluntary. An employer may notify a State that it elects to opt-out of being directly paid a premium assistance subsidy on behalf of an employee.

(2)No subsidy shall be provided to an individual under this section unless the individual (or the individual’s parent) voluntarily elects to receive such a subsidy. A State may not require such an election as a condition of receipt of medical assistance. A State may not require, as a condition of an individual (or the individual’s parent) being or remaining eligible for medical assistance under this subchapter, that the individual (or the individual’s parent) apply for enrollment in qualified employer-sponsored coverage under this section.

(3)A State shall establish a process for permitting an individual (or the parent of an individual) receiving a premium assistance subsidy to disenroll the individual from the qualified employer-sponsored coverage.

(e)In the case of the participation of an individual (or the individual’s parent) in a premium assistance subsidy under this section for qualified employer-sponsored coverage, the State shall provide for payment of all enrollee premiums for enrollment in such coverage and all deductibles, coinsurance, and other cost-sharing obligations for items and services otherwise covered under the State plan under this subchapter (exceeding the amount otherwise permitted under section 1396o of this title or, if applicable, section 1396o–1 of this title). The fact that an individual (or a parent) elects to enroll in qualified employer-sponsored coverage under this section shall not change the individual’s (or parent’s) eligibility for medical assistance under the State plan, except insofar as section 1396a(a)(25) of this title provides that payments for such assistance shall first be made under such coverage.

Notes & Related Subsidiaries

Editorial Notes

References in Text

section 2701 of the Public Health Service Act, referred to in subsec. (b)(1)(A), is section 2701 of act

July 1, 1944, which was classified to section 300gg of this title, was renumbered section 2704, effective for plan years beginning on or after Jan. 1, 2014, with certain exceptions, and amended, by Pub. L. 111–148, title I, §§ 1201(2), 1563(c)(1), formerly § 1562(c)(1), title X, § 10107(b)(1), Mar. 23, 2010, 124 Stat. 154, 264, 911, and was transferred to section 300gg–3 of this title. A new section 2701 of act

July 1, 1944, related to fair health insurance premiums, was added, effective for plan years beginning on or after Jan. 1, 2014, and amended, by Pub. L. 111–148, title I, § 1201(4), title X, § 10103(a), Mar. 23, 2010, 124 Stat. 155, 892, and is classified to section 300gg of this title. The Internal Revenue Code of 1986, referred to in subsec. (b)(1)(C), (2), is classified generally to Title 26, Internal Revenue Code.

Amendments

2010—Pub. L. 111–148, § 2003(b), struck out “option for children” after “assistance” in section catchline. Subsec. (a). Pub. L. 111–148, § 10203(b)(2)(A), inserted “and the offering of such a subsidy is cost-effective, as defined for purposes of section 1397ee(c)(3)(A) of this title” before period at end. Pub. L. 111–148, § 2003(a)(1)(B), (C), struck out “under age 19” after “all individuals” and inserted “, in the case of an individual under age 19,” after “(and”. Pub. L. 111–148, § 2003(a)(1)(A), which directed substitution of “shall” for “may elect to”, was not executed because of Pub. L. 111–148, § 10203(b)(2)(B), set out as a note under this section. Subsec. (c). Pub. L. 111–148, § 2003(a)(2), struck out “under age 19” after “by the individual”. Subsec. (d)(2). Pub. L. 111–148, § 2003(a)(3)(A), struck out “under age 19” after “to an individual” and substituted “A State may not require, as a condition of an individual (or the individual’s parent) being or remaining eligible for medical assistance under this subchapter, that the individual (or the individual’s parent) apply for enrollment in qualified employer-sponsored coverage under this section.” for “State may not require, as a condition of an individual under age 19 (or the individual’s parent) being or remaining eligible for medical assistance under this subchapter, apply for enrollment in qualified employer-sponsored coverage under this section.” Subsec. (d)(3). Pub. L. 111–148, § 2003(a)(3)(B), substituted “an individual (or the parent of an individual)” for “the parent of an individual under age 19”. Subsec. (e). Pub. L. 111–148, § 2003(a)(4), struck out “under age 19” after “an individual” in two places.

Statutory Notes and Related Subsidiaries

Effective Date

of 2010 Amendment Pub. L. 111–148, title II, § 2003(c), Mar. 23, 2010, 124 Stat. 283, provided that: “The

Amendments

made by this section [amending this section] take effect on January 1, 2014.” Pub. L. 111–148, title X, § 10203(b), Mar. 23, 2010, 124 Stat. 927, provided that the amendment made by section 10203(b)(2)(A) of Pub. L. 111–148 is effective as if included in the enactment of the Children’s Health Insurance Program Reauthorization Act of 2009 (Pub. L. 111–3).

Effective Date

Section effective Apr. 1, 2009, and applicable to child health assistance and medical assistance provided on or after that date, with certain exceptions, see section 3 of Pub. L. 111–3, set out as a note under section 1396 of this title. Effect of Certain Amendment by Pub. L. 111–148 Pub. L. 111–148, title X, § 10203(b)(2)(B), Mar. 23, 2010, 124 Stat. 927, provided that: “This Act shall be applied without regard to subparagraph (A) of section 2003(a)(1) of this Act [amending this section] and that subparagraph and the amendment made by that subparagraph are hereby deemed null, void, and of no effect.”

§1396e–1 Premium assistance

Summary

Title 42, §1396e–1

Notes & Related Subsidiaries

Editorial Notes

References in Text

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Amendments

Effective Date

Citations & Metadata