​​​​​Medicare Premium Payment (Buy-In) Program

The Medicare Premium Payment Program, or Medicare Buy-In, allows Medi-Cal to pay Medicare Part A and/or Part B premiums for Medi-Cal beneficiaries and others who qualify for Medi-Cal under special programs, allowing Medi-Cal to defer medical costs to Medicare where appropriate. The Medicare Premium Payment and the Medicare Part D State Contribution Payment programs help to ensure that Medi-Cal is the payer of last resort.


What is Medicare?

Medicare is a federal health insurance program for the aged (persons age 65 or older), certain younger individuals with disabilities, and individuals with End Stage Renal Disease (ESRD).  Medicare coverage through the state buy-in program may consists of the following:

  1. Part A -  Hospital insurance (HI)
  2. Part B - Supplementary Medical insurance (SMI)
  3. Part D - Prescription drug coverage (contribution payment)

Beneficiaries cannot have Part A Medicare coverage without Part B Medicare coverage. Beneficiaries must have Part A and/or Part B coverage to be eligible for Part D.


Medicare Part B Buy-In Agreement

The State of California participates in a buy-in agreement with the Centers for Medicare and Medicaid Services (CMS), whereby Medi-Cal automatically pays Medicare Part B premiums for all Medi-Cal beneficiaries who have Medicare Part B entitlement as reported by Social Security Administration (SSA).
Statutory Authority: Social Security Act, Section 1843


Medicare Part D State Contribution Payments

Prescription drug coverage costs shifted from Medicaid to Medicare beginning January 2006 as a result of the 2003 Medicare Prescription Drug, Improvement and Modernization Act (MMA), creating the Medicare Part D prescription drug program.  The state is required to pay a Part D premium payment for eligible for Medi-Cal beneficiaries entitled to Part A or Part B coverage.

Statutory Authority: Medicare Prescription Drug, Improvement and Modernization Act 2003


State Buy-In Manual - Part A and Part B Transaction Codes

The buy-in transaction codes provide a concise, definitive means of communication between the CMS and the State of California.  Most transaction codes require no further action on the part of the State; however, there are instances where additional action by the State is appropriate. For description of any of the transaction codes, see the PDF attachments below. 

Part A Buy-In/Group Payer Transaction Codes (PDF)
Part B Buy-In/Group Payer Transaction Codes (PDF)  

State Medicare Buy-in Program Problem Report (online fillable form)​​

​Please use the form below to report a Medicare buy-in problem to the Buy-In Unit at DHCS. The use of this form is strictly intended for state, county and federal agencies. This form is not intended for general public use. Beneficiaries​ with a buy-in problem should contact their county eligibility worker for assistance.​

To find a local SSA office, please visit: Social Security Office Locator web page.

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Last modified date: 11/22/2021 3:28 PM