New Medicare Cards: What, Why, When, & How to Prepare

Believe it or not, all Medicare beneficiaries will be receiving new Medicare identification cards. Yes, more than 57.7 million Americans will receive a new card! The Centers for Medicare & Medicaid Services (CMS) will randomly assign all Medicare beneficiaries with a new, unique number known as a Medicare Beneficiary Identifier (MBI), which will replace the Social Security Number (SSN)-based Health Insurance Claim Number (HICN) currently found on Medicare cards. Although, like the HICN, the new unique MBIs will have 11 characters, this number will look different: 1) It will contain a combination of numbers and uppercase letters. 2) It will not contain special characters or the letters “S,” “L,” “O,” “I,” “B,” or “Z,” because these letters are said to be easily misunderstood when they are spoken or written. 3) The new Medicare cards will not reveal one’s gender and will not include a signature line. Here’s an example of an MBI as it will appear on the new cards: 1EG4-TE5-MK73. 

MBIs will fit on forms the same as HICNs; the dashes are not used as part of the MBI, will not be entered into computer systems, and will not be used in file formats. See Table 1 for a description of the MBI format. Additionally, CMS is planning a wide-scale communications outreach initiative to remind beneficiaries to share their new Medicare cards with all of their healthcare providers, and to teach them how to obtain their MBIs if they lose their card. In the meantime, if the address on file for a beneficiary is different than the address received in electronic eligibility transaction responses, be sure to ask those patients to correct their address listed in Medicare’s records by contacting the Social Security Administration (SSA). This may require coordination between the billing and office staff. NOTE: If the beneficiary’s address is incorrect in the SSA’s database, the Medicare beneficiary may not receive his/her new Medicare card. 

WHY IS CMS ISSUING NEW CARDS?

The Medicare Access and CHIP Reauthorization Act of 2015 requires CMS to remove SSNs from all Medicare cards by April 2019. This initiative should help protect seniors from fraudulent use of their SSNs that can lead to identity theft and illegal use of Medicare benefits. The most current statistics from the United States Department of Justice indicate that people aged 65 and older are increasingly victimized by personal identity theft, which increased from 2.1 million to 2.6 million instances between 2012 and 2014. If you or someone you know has experienced identity theft, you already understand that it takes both an emotional and financial toll. Two-thirds of all identity theft victims report a direct financial loss.¹ Therefore, CMS launched this new card initiative to help combat identity theft and to safeguard taxpayer dollars.

WHEN WILL NEW CARDS BE ISSUED? 

CMS officials want to ensure that Medicare beneficiaries and healthcare providers know about this change well in advance and have the information they need to make a seamless transition. CMS will begin assigning new MBIs and mailing new Medicare cards in April 2018. CMS will then instruct Medicare beneficiaries on how to safely and securely destroy their current Medicare cards and how to best keep the new MBI confidential. CMS will also assure Medicare beneficiaries that the new cards will not cause any changes to their Medicare benefits. Healthcare providers should protect the MBI as personally identifiable information. Additionally, CMS plans to have a transition period during which healthcare providers can use either the HICN or the MBI to exchange data with CMS. The transition period will begin no earlier than April 1, 2018, and will end Dec. 31, 2019. During the transition period, CMS will monitor the use of HICNs and MBIs to see how many healthcare providers are ready to use only MBIs by Jan. 1, 2020. CMS will also actively monitor the transition and adjustment to the new MBIs to ensure that widespread adoption does not interrupt Medicare operations. When the transition period ends on Jan. 1, 2020, healthcare providers must use MBIs on all claims. There will only be a few exceptions, which are itemized on the website for the new cards (www.cms.gov/medicare/ssnri). 

HOW SHOULD HEALTHCARE PROVIDERS PREPARE FOR NEW CARDS?

Because this MBI on Medicare cards is used for important Medicare transactions such as billing, eligibility status, and claim status, CMS officials say they are committed to a successful transition for both Medicare beneficiaries and healthcare providers. CMS officials know that moving to new MBIs and new Medicare cards requires a lot of changes to their systems and how they conduct their business, not to mention the systems and business processes of the healthcare providers throughout the country. CMS has already started its work and is dedicated to helping healthcare providers shift to the new MBIs by April 2018. As such, CMS is planning to test all of its systems that will use the new MBIs, including enhanced integration testing for new or high-risk systems. 

Healthcare providers should follow CMS’ example and should identify all practice management systems (eg, office management systems, claims-processing system) and business processes (eg, patient registration, insurance benefit verification) that currently use the HICN, and should make all changes necessary to convert to the new MBI numbers. All changes should be made and tested by April 2018 — before CMS mails out new Medicare cards. NOTE: CMS will not be offering end-to-end testing with Medicare fee-for-service (FFS) claims processing because healthcare providers will be able to use either HICNs or MBIs during the transition period. Therefore, wound care providers should use the transition period as a live test and adjust as necessary; they can submit claims with HICNs until the transition period ends. 

When the new Medicare card program begins in April 2018, healthcare providers must obtain the MBI from each patient or on the remittance advice for all claims submitted with a valid and active HICN. If providers submit an HICN on an eligibility transaction request, the message field on the response will state when CMS mailed a new Medicare card to that individual. The message will say, “CMS mailed a Medicare card with a new MBI to this beneficiary. Medicare providers, please get the new MBI from your patient and save it in your system(s).” Beginning in October 2018 through the end of the transition period, when a valid and active HICN is submitted on Medicare FFS claims, both the HICN and the MBI will be stated on the remittance advice. In addition, CMS is working to develop capabilities for healthcare providers to access a beneficiary’s MBI through a secure lookup tool at the point of service. Once Medicare beneficiaries receive their new Medicare cards and MBIs, healthcare providers can start using the MBIs. CMS will continue to accept the HICN through the transition period and will: 

• Process claims submitted with either the HICN or the MBI. This will give healthcare providers and their billers the chance to change their systems if there are problems with claims submitted using the MBI.
• Keep track of when claims are submitted and other transactions are completed so they can measure MBI usage.

Once CMS begins mailing new Medicare cards, those beneficiaries who are new to Medicare will only be assigned an MBI. Therefore, healthcare providers’ systems must be ready to accept the MBI by April 2018. See Table 2 for the MBI implementation milestones that CMS has set for itself. Healthcare providers should also develop an implementation plan and timeline to be ready before April 2018. As stated earlier, CMS is committed to providing outreach and education for the provider community (1.5 million providers); approximately 60 million beneficiaries, their families, caregivers, and advocacy groups; health plans; states and territories; and other business partners, including vendors. What follows are additional outreach and education initiatives already in place:

• CMS established an email address for stakeholders to submit comments or questions to the new Medicare cards team: ssnremoval@cms.hhs.gov
• CMS has begun holding quarterly forums about this initiative: www.cms.gov/medicare/ssnri 
• MLN Connects,^® CMS’ weekly newsletter, addresses information about the new Medicare cards. Subscribe online by visiting www.cms.gov/outreach-and-education/outreach/ffsprovpartprog/provider-partnership-email-archive.html
• CMS will include details about the new cards in the handbook that all Medicare beneficiaries will receive in October 2017. 

Kathleen D. Schaum is president and founder of Kathleen D. Schaum & Associates Inc., Lake Worth, FL. 

Reference

1. Victims of Identity Theft, 2014. Bureau of Justice Statistics. Accessed online: www.bjs.gov/content/pub/pdf/vit14_sum.pdf