Common use of Low Income Subsidy (LIS) Clause in Contracts

Low Income Subsidy (LIS). The low income premium subsidy that CMS pays on behalf of an LIS-eligible Member must be passed through to the Member. With respect to the premium contributions collected from your LIS-eligible Members, the monthly low income premium subsidy will first be used to reduce that portion of the premium paid for by the LIS-eligible Member, with any remaining portion of the premium subsidy amount then used to reduce the employer’s premium contribution. In the event you offer a Medicare Advantage plan that includes Part D drug benefits, if the low income premium subsidy amount for which a Member is eligible is less than the portion of the monthly premium paid by the Member, then you should communicate to the enrollee the financial consequences for the Member enrolling in your Medicare Advantage plan as compared to enrolling in another Part D plan with a monthly premium equal to or below the low income premium subsidy amount.