HI 00815.001 State Buy-In Program General Description
The Buy-In Program was established in the Social Security Amendments of 1965 and was
made effective along with the Medicare program on July 1, 1966.
Under the Buy-In Program, States may enroll certain groups of needy people under the
Supplementary Medical Insurance Program (also referred to as SMI or Medicare Part
B) and pay their Medicare premiums. The purpose of Buy-in is to permit the State,
as part of its total assistance plan, to provide SMI protection to certain groups
of needy beneficiaries. It transfers some medical costs for this population from the
Title XIX Medicaid program, which is partially State financed, to the Title XVIII
Medicare program, which is funded by the Federal Government and beneficiary premium
payments. Federal Financial Participation (FFP) is available through the Medicaid
program to assist the States with the premium payments for certain groups of beneficiaries
(i.e., those needing cash assistance or deemed cash beneficiaries). The legal authority
for the Buy-In Program is Section 1843 of the Social Security Act.
Generally, States Buy-in for beneficiaries who are cash assistance or are “deemed” cash assistance beneficiaries (see HI
00815.012 for information on deemed cash beneficiaries), are categorically needy under the
Medicaid program, and meet the eligibility requirements for Medicare Part B. States
may also include in their Buy-in agreement those Part B-eligible beneficiaries who
are not beneficiaries of cash assistance, but are eligible for Medical Assistance
Only (MAO) and those federally approved as part of the State's Medicaid plan.
A beneficiary’s enrollment under a State Buy-in agreement is involuntary. The State
may enroll the beneficiary even though he does not wish to enroll, or has enrolled
individually. A beneficiary cannot voluntarily terminate State Buy-in coverage. Prior
beneficiary or Buy-in enrollments have no effect on Buy-in eligibility and the State
pays the standard premium regardless of the date the beneficiary first became eligible
for Medicare Part B.