TN 20 (02-95)

HI 01001.011 Examples of Premium Increases for Late Enrollment

A. EXAMPLE - CLAIMANT HAS NO EXCLUDABLE MONTHS

John Brown, age 65 and first eligible for Part B in 1/87, first enrolled on 2/15/89 (in the GEP beginning 1/1/89). The months considered in determining Mr. Brown's premium increase begin with 5/87 (the first month after the close of his IEP) and extend through 3/89 (see HI 01001.010 B.1.) for a total of 23 months. Since there is only one full 12-month period in 23 months, Mr. Brown's premium (beginning 7/89, the first month of SMI coverage) was 10 percent greater than if he had enrolled in his IEP.

B. EXAMPLE - HOW A PENALTY OF 230 PERCENT WOULD OCCUR

Hetty Blue was born in 1899 and was therefore eligible to enroll in SMI during the initial general enrollment period (IGEP) ending 5/31/66. She first enrolled during the 1969 GEP,with coverage effective 7/69; her SMI was subsequently terminated effective 1/31/70 for nonpayment of premiums. Mrs. Blue next enrolled during the 1990 GEP with coverage effective 7/90. The following months are counted against her for purposes of the premium increase: 34 months for 6/66 - 3/69 inclusive, plus 242 for 2/70 -3/90 inclusive. The total number of countable months is 276 and Mrs. Blue must therefore pay a 230 percent increase in her premiums.

C. EXAMPLE - LATE ENROLLMENT PLUS REENROLLMENT

Irving Howard, who was born in 1899,and was eligible to enroll during the IGEP ending 5/31/66, first enrolled in 3/68 during the extended GEP. SSA terminated his coverage for nonpayment of premiums effective 9/30/68, and he reenrolled in 2/71. Under HI 01001.010 B.1. and B.2.b., Mr. Howard had 49 months chargeable against him (19 months for the period 6/66 -12/67, inclusive, plus 30 months for 10/68 - 3/71, inclusive) and had to pay a 40 percent increase in his premiums.

D. EXAMPLE - EFFECT OF 3-YEAR LIMIT ON ENROLLMENT AND REENROLLMENT

Oscar Hicks, who was born in 1900,and first eligible to enroll during the IGEP ending 5/31/66, first enrolled in the 1969 GEP (the last GEP in which he could have initially enrolled under the law then in effect). Shortly after coverage became effective (7/69), he terminated his SMI effective 12/31/ 69. Although eligible to reenroll in the next three GEP's, Mr. Hicks did not enroll until the 1973 GEP. The 1972 GEP was the last period in which he could enroll under the law in effect prior to the 1972 Amendments. Therefore, pursuant to HI 01001.010 B.2.e, no months between 4/72 and 12/72, inclusive,were counted against Mr. Hicks for purposes of the premium increase. Mr. Hicks had 64 months chargeable against him (34 months for 6/66 - 3/69, inclusive, plus 27 months for 1/70 - 3/72, inclusive, plus 3 months for 1 /73 - 3/73, inclusive) and he paid a 50 percent increase in the premiums.

E. EXAMPLE - COMBINATION OF EXCLUSION MONTHS, PLUS PREMIUM-HI

1. Initial Enrollment and Reenrollment

Lou Brook enrolled in SMI effective with 5/1/75, the month he attained age 65. His enrollment terminated 12/31/75. He reenrolled during the 1977 GEP. His premium increased by 10 percent because 15 months had elapsed from the end of his first coverage period through 3/77 (the end of the 1977 GEP). This period of coverage terminated effective with 12/31/77.

2. Two - Enrollment Limit, 1981 Open Enrollment

He was then barred from reenrollment under the law in effect prior to 4/1/ 81.

With the repeal of the 2-enrollment limitation as of 4/1/81 and the institution of the open enrollment period (which concept only lasted from 4/1 /81 through 9/30/81, when it was repealed), Mr. Brook reenrolled in 7/ 81.

The only months charged against him for premium increase purposes were the 15 months between his first period of coverage and the end of the 1977 GEP plus the 4 months from 4/81 (the first month in which the law permitted a third enrollment) through 7/81, a total of 19 months. His premium was, therefore, still only increased by 10 percent.

3. If Enrollment Had Occurred In 1982

Had he not enrolled during the 4/81 through 9/81 open enrollment period but waited until the 1982 GEP to reenroll, his premium would have been increased by 20 percent because the 12 months 4/81 through 3/82 would be added to the 15 months that elapsed between his first 2 periods of coverage, a total of 27 months.

4. If Premium-HI Were Involved

If Mr. Brook had been uninsured and decided to enroll in Premium-HI also during 7/81,the months elapsing after the end of his