Question: Can Medicare be accepted as a form of alternative minimum essential coverage to meet the requirements of an eligible opt out arrangement for cash in lieu?
Answer: Yes, Medicare qualifies as alternative minimum essential coverage for an employee who has opted out of an employer’s group health plan and would like to receive cash in lieu. An employer who has negotiated an eligible opt out arrangement for represented employees or adopted one for unrepresented employees can accept an employee’s proof or attestation of enrollment in Medicare to meet the requirement that the employee be enrolled in alternative minimum essential coverage. Although Medicare is not considered a group health plan, eligible opt out arrangements should be set up to accept the alternative “minimum essential coverage,” which encompasses a broader category of health insurance plans than just group health plans. However, please note that minimum essential coverage does not include enrollment in individual coverage through Covered California for eligible opt out arrangements.