HI 01001.265 Responsibilities of Parties to Formal Group Collection Arrangements
While the group may act on behalf of a beneficiary in forwarding Medicare premium payments, the beneficiary, nevertheless, is responsible for making them. The formal group merely acts as his/her agent. Any notice sent to the agent is considered notice to the beneficiary and the beneficiary suffers the consequences in the event of default (nonpayment or incorrectly identified payment) on the part of the premium payer. However, relief should be considered when formal group payment is involved in Medicare Part B termination (see HI 01001.295 and HI 01001.300).
The beneficiary is obligated to promptly notify both the Formal Third Party Group Payer and Centers for Medicare & Medicaid Services (CMS) and the Social Security Administration (SSA) of any change of address.
B. Formal Group Payer
The Formal Group Payer is obligated to make payments promptly upon receipt of bills, to notify promptly both the beneficiary and CMS when dropping a beneficiary from the group, to report premiums in a timely manner, and to hold in confidence all information obtained from CMS in carrying out its function as a Formal Third Party Group Payer.
C. The Agency
Upon authorization from the beneficiary, CMS will give a summary accounting statement (SAS) to the payer no less often than if there were no Formal Group Payer; will notify both the payer and the beneficiary of delinquency in the event the payer does not make timely payments; and will make premium refunds available to the Formal Third Party Group Payer in accordance with HI 01001.240 F.