[Code of Federal Regulations]

[Title 42, Volume 2]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 42CFR408.6]



[Page 274-275]

 

                         TITLE 42--PUBLIC HEALTH

 

                    CHAPTER IV--CENTERS FOR MEDICARE

                          & MEDICAID SERVICES,

                        DEPARTMENT OF HEALTH AND

                             HUMAN SERVICES

 

PART 408_PREMIUMS FOR SUPPLEMENTARY MEDICAL INSURANCE--Table of Contents

 

                      Subpart A_General Provisions

 

Sec. 408.6  Methods and priorities for payment.



    (a) Methods of payment--(1) General rules. Premiums are paid by one 

of the following four methods:

    (i) Payment by a State under a buy-in agreement.

    (ii) Deduction from monthly railroad retirement of social security 

cash benefits or Federal civil service annuities.

    (iii) Direct remittance on an individual basis, by or on behalf of 

the enrollee.

    (iv) Direct remittance on a group basis, by an employer, union, 

lodge or other organization, or by an entity of State or local 

government.

    (2) Special situations. (i) If the monthly social security benefit 

or age 72 special benefit is less than the monthly premium, the benefit 

is withheld and the enrollee is required to pay the balance through 

direct remittance. (This situation may arise if the individual first 

becomes eligible for social security benefits after December 31, 1981, 

and is, therefore, not eligible for the fixed minimum, or receives age 

72 special benefits that are reduced because the individual receives a 

government pension.)

    (ii) If the monthly railroad retirement benefit or civil service 

annuity payment is less than the premium, the monthly payment is not 

withheld and the enrollee is required to pay the total premium by direct 

remittance.

    (b) Priorities for payment. (1) If an enrollee is enrolled under a 

State buy-in agreement--

    (i) SMI premiums may not be deducted from monthly cash benefits or 

annuities; and

    (ii) The enrollee may not be required to pay by direct remittance.

    (2) If an enrollee is not covered under a State buy-in agreement, 

but is receiving a monthly benefit or an annuity specified in paragraph 

(a)(1)(ii) of this section--

    (i) The premiums are deducted from that benefit or annuity; or

    (ii) If the monthly benefit or payment is less than the monthly 

premium, the rules of paragraph (a)(2) of this section apply.

    (3) If an enrollee is neither covered under a State buy-in 

agreement, nor receiving monthly benefits or annuity payments, the 

premiums must be paid totally by direct remittance.

    (c) Payment by a State under a buy-in agreement. (1) A buy-in 

agreement is an agreement under which a State, through enrollment and 

payment of SMI premiums, secures SMI benefits



[[Page 275]]



for individuals who are eligible for that program and also eligible for 

certain other cash or medical benefits. (Policies on enrollment under 

State buy-in agreements are contained in subpart C of part 407 of this 

chapter.)

    (2) The State pays the premiums for each month for which an 

individual is covered under the agreement.

    (3) If an individual's coverage under a State buy-in agreement 

terminates, his coverage continues on an individual enrollment basis. 

The premiums are then deducted from benefits, as set forth in subpart C 

of this part, or paid by direct remittance in accordance with subpart D 

or subpart E of this part.

    (4) Policy on collection of premiums from buy-in States is set forth 

in a Federal Register notice published on September 30, 1985 at 50 FR 

39784.