Medicaid programs help pay for Medicare premiums and, in some cases, Medicare cost-sharing, for certain low-income adults over age 65 and people with disabilities. All states, D.C., and some U.S. territories have entered into Part B state buy-in agreements with CMS to pay Part B premiums for those receiving Supplemental Security Income (SSI) and other cash assistance, those enrolled in the Medicare Savings Programs (MSPs), and certain other Medicaid coverage groups. Most states have expanded their buy-in agreements to include the payment of Part A premiums for Qualified Medicare Beneficiaries (QMBs).
State buy-in agreements simplify the process for states to assist low-income residents with Medicare expenses. Buy-in agreements permit states to directly enroll eligible individuals in Medicare Part A and/or B at any time of the year, without regard for Medicare enrollment periods, and to pay premiums on their behalf, without any late enrollment penalties. For an individual who is determined eligible for Medicare by SSA, but not enrolled, state buy-in works to enroll the individual in Medicare Part A or Part B and to direct the federal government to bill the state for the enrollee’s premiums. For an individual who is already enrolled in Medicare, state buy-in directs the federal government to bill the state for the beneficiary’s Medicare premiums and stop collecting the premiums through deductions from the beneficiary’s monthly Social Security, Railroad Retirement Board (RRB), Office of Personnel Management (OPM) benefits, or through CMS direct billing.
State Buy-in File Data Exchange. State buy-in of Medicare premiums for dually eligible individuals operates through an established data exchange process between the state, CMS, and SSA. States depend on the successful transmission of accretion, deletion, and change records to effectively update states’ roles for their MSPs. In turn, CMS will update all records through the CMS Third Party System (TPS) and return a response file to inform the state about the disposition of each record. CMS returns a rejection notification when a state’s request fails to update through TPS processing.
This data exchange is covered by an Information Exchange Agreement (IEA) and accompanying Data Request and Attestation (DRA) form. For more information on these agreements, please visit the Data Agreement Page.