New York State Seal
STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

David A. Paterson
Governor

Eric R. Dinallo
Superintendent

OGC Op. No. 09-05-03

The Office of General Counsel issued the following opinion on May 29, 2009, representing the position of the New York State Insurance Department.

Re: Requiring a Medicare-Eligible Employee to Enroll in Medicare Part B

Questions Presented:

1. May an employer with more than twenty employees require that an employee who is Medicare-eligible due to his or her age enroll in Medicare Part B?

2. If an employer with more than twenty employees may require that an employee who is Medicare-eligible due to his or her age enroll in Medicare Part B, then may that employer require the Medicare-eligible employee to terminate his or her membership in the company’s health insurance plan, and reimburse the employee for his or her respective Part B premium or an amount equal to the premium that the employer would have paid had the employee remained a member of the company’s health insurance plan?

3. May an employer with more than twenty employees pay a lower percentage of the cost of coverage for an employee who is Medicare-eligible due to his or her age than it would for a non-Medicare eligible employee?

Conclusion:

The New York Insurance Law and regulations promulgated thereunder do not directly address employers, because the New York State Insurance Department (“Department”) does not regulate employers. Nor is the Department responsible for overseeing the federal Medicare program. Thus, the Department suggested that the inquirer contact the U.S. Department of Health & Human Services, U.S. Department of Labor, and New York State Department of Labor with any questions the inquirer may have regarding employers and Medicare Part B.

Facts:

The inquiry is of a general nature, without reference to particular facts.

Analysis:

Medicare is a federal health insurance program for people sixty-five years of age or older; people under the age of sixty-five who have certain disabilities; and people of all ages who have End-Stage Renal Disease. See Medicare Program - General Information, Centers for Medicare & Medicaid Services, U.S. Department of Health & Human Services, http://www.cms.hhs.gov/MedicareGenInfo/. Medicare consists of two parts: Part A, which provides hospital insurance, and Part B, which provides medical insurance. See id. Medicare Part B covers doctors’ services, outpatient care, some services that Medicare Part A does not cover (including certain services rendered by physical and occupational therapists), and some home health care. See id. Most people must pay a monthly premium for Medicare Part B. See id.

The inquirer asks whether an employer with more than twenty employees may require an employee who is Medicare-eligible due to his or her age to enroll in Medicare Part B and if so, whether the employer may then require the Medicare-eligible employee to terminate his or her membership in the company’s health insurance plan and reimburse the employee for his or her respective Part B premium or an amount equal to the premium that the employer would have paid had the employee remained a member of the company’s health insurance plan. The inquirer further asks whether an employer with more than twenty employees may pay a lower percentage of the cost of coverage for an employee who is Medicare-eligible due to his or her age than it would for a non-Medicare eligible employee.

The Insurance Law and regulations promulgated thereunder do not directly address employers, because the Department does not regulate employers. Nor is the Department responsible for overseeing the federal Medicare program. Thus, the Department suggested that the inquirer contact the U.S. Department of Health & Human Services, U.S. Department of Labor, and New York State Department of Labor with any questions the inquirer may have regarding employers and Medicare Part B.

For further information, you may contact Senior Attorney Joana Lucashuk at the New York City office.