PPO - Preferred Provider Organization - Medicare: Equity-League Fund

Response to Questions from Medicare Eligible Self-Pay Participants on the new OAP

Questions have been raised about why Medicare eligible members covered by the Health Fund through self-pay contributions can not participate in the new OAP program.

There are two types of Medicare eligible members. There are Medicare eligible members who are covered by the Health Fund because of employer-paid contributions and there are Medicare eligible members who have exhausted their Health Fund eligibility but remain covered through self-pay contributions.

For Medicare eligible members covered by the Health Fund through self-pay contributions, Medicare is generally the primary payor of medical expenses and Medicare does not allow the Fund to offer OAP participation. Medicare sets the fees paid to doctors and other providers under the Medicare program and will not recognize the arrangements negotiated by the OAP. The fees set by Medicare are significantly lower than the usual, customary and reasonable charge amounts that CIGNA accepts under the Major Medical indemnity plan so in some sense Medicare is a OAP.

Certain benefits provided by the Fund to Medicare eligible self-pay members, such as drug, dental and optical benefits, are not covered by Medicare. The Fund does offer OAP type arrangements for these benefits.

For Medicare eligible members who are eligible for the Health Fund through employer-paid contributions, the OAP is available. This is because the Health Fund provides primary medical coverage and Medicare is secondary. That is, the Fund is responsible to pay first based on the Fund benefit provisions and Medicare only fills in Fund deductibles and co-insurance amounts. Using the OAP for a doctor’s visit , the Fund pays the doctor fees except for the $25 co-pay. The member can submit a receipt for the $25 OAP co-pay to Medicare for reimbursement.

Any questions you may have regarding the above mentioned may be directed to the Equity-League Health Fund office at (212) 869-9380 or (800) 344-5220 or contact Equity League via the email.

465245/01738.001