TN 19 (03-93)

HI 00805.236 Current Equitable Relief Considerations Involving CHAMPUS

A. Background

1. CHAMPUS

CHAMPUS is the Civilian Health and Medical Program of the Uniformed Services. It is under the Department of Defense (DoD). It provides health care for active or retired members of the Armed Services and their dependents, and for dependents of deceased members of the Armed Services.

2. Effect of HI eligibility

Until 1991 (see HI 00805.731 A.), CHAMPUS entitlement terminated when any individual became eligible for hospital insurance (HI) under Medicare on a non-premium basis. Since 1991, CHAMPUS does not terminate for beneficiaries entitled to Medicare on the basis of disability (but not ESRD) if they enroll in SMI. (CHAMPUS then becomes secondary payer for the disabled and also pays for prescription drugs.)

3. CHAMPUS actions for those who are age 65

Since dates of birth are on CHAMPUS records, those who are approaching age 65 are notified by CHAMPUS to file for HI and SMI because CHAMPUS will end at age 65. They then obtain HI and SMI, if eligible.

If not eligible for premium-free HI, they receive a disallowance letter from SSA which, when submitted to CHAMPUS, permits continued CHAMPUS entitlement.

4. CHAMPUS problems

CHAMPUS does not have a reliable way of pinpointing which of its beneficiaries under age 65 are disabled or have ESRD. Some of the CHAMPUS advisors have incorrectly counseled beneficiaries about their eligibility. As a result of these problems, some disabled people have been continued on CHAMPUS erroneously.

In addition, some aged or ESRD beneficiaries, while properly identified, have been given erroneous information by CHAMPUS advisors about the effect of Medicare on CHAMPUS eligibility and have been erroneously continued on the CHAMPUS rolls.

When the erroneous entitlements are discovered, and if DoD records show that the cause is Federal Government error, the individuals receive a letter from DoD's Defense Enrollment Eligibility Reporting System (DEERS) admitting fault and referring the individuals to SSA for enrollment in SMI under equitable relief.

B. Policy

Since an error by DEERS (or DoD) is an error by a Federal Government agency, equitable relief is given as described in HI 00805.170ff. The individual will have the same coverage and premium amount that he/she would have had if proper information had been given. That is:

  • There will be no premium surcharge for late enrollment attributable to the government error;

  • The individual can enroll within the time limit described in the letter (usually 120 days from the date of the letter); and

  • SMI entitlement begins with the month of enrollment, or retroactive to the earliest possible month of SMI entitlement but no earlier than 1 /78 (if he/she will pay the retroactive premiums). (See HI 00805.720 B. concerning the 1/78 date.)

Individuals already on the SMI rolls when they receive the DEERS letter should have any premium surcharge attributable to the government error eliminated. The excess premiums should be refunded (or credited to their account if they are in billing status). If they want fully retroactive SMI, they can elect that, if they are willing to pay the premiums for it.

C. Procedures

1. SMI enrollment

Use the Form HCFA-40B or any signed statement to the effect that the individual wants to be enrolled in SMI and the date he/she wants SMI (currently or fully retroactive).

Include in the material being sent to ODO (or a PSC) a copy of the DEERS letter, and a cover Report of Contact that says in red: “Process this SMI enrollment in accordance with HI 00805.236.”

2. DEERS letter not received

If an individual alleges that he/she was unaware that Medicare eligibility affected CHAMPUS entitlement, but does not have the letter from DEERS, direct the individual to one of the following numbers to discuss the situation and to obtain the above-mentioned letter from DEERS, if there was Federal Government fault.

In California — 1-800-334-4162

In Alaska and Hawaii — 1-800-527-5602

All other areas — 1-800-538-9552

If an individual is unable to obtain the letter from DEERS:

  • do not process an enrollment under the equitable relief rules; and

  • advise the individual about the regular G