UnitedHealthcare to apply Medicare estimation to fully insured small and large groups, effective Jan. 1, 2023

Beginning Jan. 1, 2023, UnitedHealthcare will apply or revise the methodology in which the Medicare estimation process is calculated for fully insured small group and large group business in all applicable markets for members who are Medicare-eligible who have Medicare Part A but not Medicare Part B, and who have Medicare as primary.

Fully insured small groups

• New business: As of Jan. 1, 2023, UnitedHealthcare will begin applying the Medicare estimation process for new business members who are Medicare-eligible who have Medicare Part A, but not Medicare Part B and for whom Medicare is primary
• Renewing business: For existing groups, this process will be implemented at renewal beginning with July 1, 2023, renewals

Fully insured large groups

• New business: As of Jan. 1, 2023, UnitedHealthcare will begin applying the Medicare estimation process for new business members who are Medicare-eligible who have Medicare Part A, but not Medicare Part B and for whom Medicare is primary
• Renewing business: For existing groups, this process will be implemented beginning July 1, 2023, by shifting the Medicare estimation methodology upon renewal from 20% of billed amount to Medicare allowed, where supported in the Certificate of Coverage (COC)
• Key Accounts, National Accounts

Level Funded groups

• New business: As of Feb. 1, 2023, UnitedHealthcare begin applying the Medicare estimation process for new business members who are Medicare-eligible who have Medicare Part A, but not Medicare Part B and for whom Medicare is primary
• Renewing business: For existing groups, this process will be implemented at renewal beginning with July 1, 2023, renewals

Member notification

All members who have enrolled in Medicare Part A – but not Medicare Part B – and who do not have Medicare Part B coverage will receive letters beginning November 15, informing them they may be subject to higher out-of-pocket costs beginning Jan. 1, 2023, for new customers or July 1, 2023, for renewing customers.

The letter encourages members to visit this Medicare website during their eligibility time frame of Jan. 1 through March 31, 2023.

What is Medicare estimation?

Medicare estimation is an accepted industry standard process for determining secondary plan payment when Medicare is primary and the member is enrolled in Part A, but not enrolled in Medicare Part B. Medicare estimation reduces the plan’s payment for eligible covered benefits by the amount primary Medicare Part B would have paid if the eligible member was enrolled in Medicare Part B. The amount that Medicare Part B would have covered is not covered by the fully insured plan. 

Once a member becomes eligible for Medicare Part B coverage, the amount Medicare would have paid as the primary payer for eligible covered services is estimated, and the fully insured plan benefit payout is reduced by this amount. This process is described in the enrolled member’s COC.

Medicare estimation application and examples

Medicare estimation applies to members who have enrolled in Medicare Part A, but not Medicare Part B, even though they are eligible and Medicare is primary.

Some examples of when Medicare is primary include when a member is:

• Enrolled in Medicare due to age and an employer has fewer than 20 employees
• Enrolled in Medicare due to disability and an employer has fewer than 100 employees
• At the end of a certain period of dialysis after a member has been diagnosed with end-stage renal disease (ESRD)
• Not actively working and is covered under Retiree, COBRA, or a State Continuation plan regardless of the basis for Medicare enrollment or the size of the former employer.

Medicare estimation applies in any of the following scenarios:

• Member has Part A and not Part B and Medicare is primary
• Member has both Parts A and B (primary), but the provider does not bill or participate in Medicare or has specifically opted out of Medicare
• Member had Part B only (primary), but the provider does not bill or participate in Medicare or has specifically opted out of Medicare

Medicare estimation does not apply in these scenarios:

• Member has Part B, and the provider is participating with Medicare. If the member has Part B, UnitedHealthcare pays secondary based on actual amount Medicare paid
• Medicare (any part) is the member’s secondary payer
• Member is not eligible for Medicare

For more information and next steps, please contact your UnitedHealthcare representative.