Medivest Blog - Company Updates, Industry News, and Insights

Craig Pawley, Vice President of Business Development

20/May/2025

Effective July 1, 2009, the Medicare & Medicaid SCHIP Extension Act (MMSEA) requires that “applicable plans” must first determine whether an injured party (including an individual whose claim is unresolved) is entitled to Medicare benefits. The primary payer must then report the “required information,” once the case is resolved, to the Secretary of the Department of Health and Human Services (Secretary of HHS) in the “form, manner, and frequency” the Secretary prescribes (CMS is a regulatory body under HHS). If this information is not provided to Medicare in the form, manner, and frequency requested, Medicare may impose a fine of up to $1000 per day, per injured party, as Civil Monetary Penalties (CMPs).

Before the MMSEA was enacted, Medicare relied on settling parties to notify it when settling a case for a Medicare beneficiary. This process allowed Medicare to gather some information about the case and look for instances where it had made payments for treatment and RXs where there was a primary payor involved (i.e. Carrier, TPA, Self-Insured, etc). Because this information was not required by law, Medicare put in place a mandatory insurer reporting (MIR) process that requires primary payors to provide over 200 data fields with information about the case and all the parties involved. The collection of that data is then used to place a marker in Medicare’s system. This marker will help Medicare determine if treatment or prescriptions are related to a settlement involving a primary payor. Medicare will then use that marker as a reference point to deny paying for Medicare-covered, case-related treatment. There have been improvements made to the system over the last 16 years, and the number of data fields that must be reported has increased over time.

Fast forward to April 4th, 2025. Medicare now requires that if a MSA allocation was prepared on the case, that information must be entered into the WCMSA field during the reporting process. Medicare expects the MSA amount to be spent on Medicare-covered, case-related treatment per CMS’s guidelines for MSA funds. In the past, Medicare was unaware of the MSA amount if the case was not submitted to CMS for approval. CMS has seen a steady decline in cases being submitted for approval, and essentially had no viewership on the MSA figure, which makes it difficult to know when Medicare would step in and become the primary payor again for Medicare-covered, case-related items. As of April 4th, 2025, Medicare now requires this information to be provided to them regardless of whether a MSA allocation was submitted to them for approval.

Medicare is now armed with all the information they need, regardless of submission status, to review and deny payments for Medicare-covered, case-related items. This will force the individual to use those MSA funds for Medicare-covered, case-related treatment until they are exhausted. Accurate accounting and annual attestations (post-settlement) must be provided to Medicare before they step in as the primary payor. If the beneficiary fails to provide the necessary information, Medicare will continue to deny payments until proper documentation is provided that shows the WCMSA funds were spent in compliance with Medicare guidelines. If those funds were misappropriated, Medicare will continue to deny payment for any Medicare-covered, case-related treatment and RXs until the funds are replenished and spent according to Medicare’s guidelines.

In 2017, CMS indicated, “Although beneficiaries may act as their own administrators, it is highly recommended that settlement recipients consider the use of a professional administrator for their funds.” Now that the WCMSA field is required as part of the Mandatory Insurer Reporting process, it is critical to discuss the proper administration of the MSA funds during the settlement process.

If you have any questions or would like more information about how Medivest can protect future Medicare benefits for the injured worker, please contact us at info@medivest.com or contact our office at 877-725-2467.

Craig Pawley, Vice President of Business Development

08/May/2025

CMS has repeatedly kicked the can down the road concerning Liability Medicare Set-Asides guidelines and how to protect Medicare’s future interest in an injury case. Even though Medicare has not issued any guidelines for Liability cases as they have for workers’ compensation cases, the same Medicare Secondary Payer (MSP) statute that applies to workers’ compensation cases also applies to liability cases. Plaintiff attorneys should understand the risks when Medicare’s interest is not considered.

Below is a list of the 5 plans deemed primary to Medicare by the statute:

- Workers’ Compensation
- Auto
- Liability
- No Fault
- Self-Insured Plans

There is a common misconception that the need to protect Medicare’s future interest in a case is limited to workers’ compensation claims. It is important to understand the risks associated with not addressing Medicare’s interests in a liability settlement for a Medicare beneficiary. While there is no official guidance on how to address Medicare’s future interest in a liability case, the lack of guidance does not mean that the MSP statute no longer applies.

How Will Medicare Find Out About My Case?

In December 2009, Congress passed the Medicare and Medicaid SCHIP Extension Act that requires primary payors (insurance carriers, TPAs, etc.) to first determine if an individual whose case is settling is a Medicare beneficiary. The primary payer must then report the “required information,” once the case is resolved, to the Secretary of the Department of Health and Human Services in the “form, manner, and frequency” the Secretary prescribes. Failure to do so can result in civil monetary penalties of up to $1000 per day, per claim. This information includes over 200 data fields related to the case, including ICD-9 and ICD-10 codes, accident/injury descriptions, parties involved in the settlement, and personal identifying information for the plaintiff. Once this information is received by Medicare, they place a marker in their system that helps them track and deny case-related treatment and prescriptions. This forces the individual to use their settlement funds for future treatment related to the case. If those funds are spent per Medicare’s guidelines and they become exhausted, Medicare will step in as the primary payor going forward.

With the increased oversight for cases involving a Medicare beneficiary, steps must be taken to protect Medicare’s past and future interests in the case. While there is no statute in place that requires a Medicare-Set-Aside (MSA) arrangement in workers’ compensation or liability cases, it is one of the few methods that have been proven to address Medicare’s concerns.

Determining if a Medicare Set-Aside (MSA) arrangement is the right choice for your case depends on several factors

- Is the individual currently receiving Medicare benefits or will be receiving Medicare benefits within the next 30 months?
- Is the individual over 62.5 years old?
- Is the individual currently receiving Social Security Disability Insurance (SSDI) or has an open application for SSDI benefits?
- Is there a need for Medicare-covered, case-related treatment, and prescriptions based on the medical records?

If the individual meets the criteria listed above, a Medicare Set-Aside is the most conservative method available to comply with the MSP statute with respect to Medicare’s future interest in the case. The Medicare Secondary Payor Statute gives Medicare rights as a secondary payor, and they are prohibited from making a payment when there is a primary payor involved. Failure to address Medicare’s interest in the case typically results in Medicare denying payment for Medicare-covered, case-related treatment and prescriptions. If a MSA amount is not designated as part of the settlement, CMS has indicated they can assume the net settlement amount to the individual is the “future medical fund” and they will not step in to pay for case Medicare-covered, case-related treatment and prescriptions until all the funds are spent according to Medicare’s guidelines for MSA funds. Designating a MSA amount establishes a paper trail of what was done to protect Medicare in the settlement, and it will limit Medicare from considering the entire net settlement amount to the individual to be the MSA amount.

If the MSP statute is ignored during the settlement process, Medicare can deny payment for Medicare-covered, case-related treatment and prescriptions until documentation is provided showing how much out of the settlement was set aside and how those funds were spent. Designating a MSA amount allows you to set aside a piece of the pie. By not designating a MSA amount, the individual may be required to spend all of their settlement funds on Medicare-covered, case-related treatment before Medicare agrees to step in and become the primary payor again. CMS would require proof that the funds were spent correctly before doing so. It is much better to set aside a piece of the pie than the whole pie.

As you work toward settlement, it is important to understand how addressing Medicare compliance issues creates a safety net for individuals, should their condition deteriorate over time. Medicare’s primary mechanism to enforce the MSP statute is a denial of payments. If settlement funds have not been spent by Medicare guidelines for MSA funds, Medicare will deny payments leaving the individual in a bad situation. Even though CMS has not issued guidelines for liability settlements, the MSP Statute of 1980 clearly states that liability is a primary plan, and you must protect Medicare’s interest in the case.

In the end, the greatest risk lies in doing nothing. By taking a conservative approach and preparing a Medicare Set-Aside, you help protect all parties and ensure compliance every step of the way.

About Medivest

Founded in 1996, Medivest is a national Medicare Secondary Payer (MSP) compliance company and provider of settlement solutions. Our focus is assisting anyone settling a workers’ compensation or personal injury claim to understand their obligation to consider Medicare’s interests under federal law. Medivest provides pre- and post-settlement solutions that help mitigate exposure from that obligation. Contact us today at 877-725-2467 or medivest.com/contact-us.

Medivest

16/Apr/2025

Sometimes reaching a settlement agreement isn’t easy. Even when both parties are eager to resolve a case, negotiations can hit a wall. That’s because successful negotiation always requires compromise. Each side must be willing to give a little to gain a little. But what happens when both parties reach an impasse and can’t find a solution that works for everyone?

This is where offering Professional Administration can become a game-changing strategy. By introducing this option during negotiations, you can provide a creative solution that adds value for both sides, reduces future risk, and makes compromise more appealing.

Why Do Settlements Stall?

Settlement negotiations can break down for several reasons, including:

Disputes Over Future Medical Costs: Parties can’t agree on the value of future care or the size of the MSA.
Fear of Mismanaging MSA Funds: An injured individual may hesitate to settle if they don’t feel confident managing Medicare money on their own.
Compliance Concerns: Payers worry about post-settlement compliance and possible CMS scrutiny.
Disagreements on Reversion Interest of Unused Funds: Parties clash over what happens to unspent MSA funds after the injured party passes away.
Who Pays for Professional Administration: Both sides may see it as “the other party’s responsibility.”
Distrust or Unclear Communication: Settlement language or responsibilities may feel too vague, leading to hesitation or second-guessing.

Any one of these issues can stall negotiations for weeks, months or even longer.

The Fix: Professional MSA Administration

Professional Administrators take full responsibility for managing the Medicare Set-Aside (MSA) account, ensuring funds are spent properly, reporting is handled, and Medicare compliance is maintained. By offering Professional Administration during the negotiation process, it can help move the case towards settlement. The following are ways Professional Administration can help your settlement.

Flexibility in Payment – Either Side Can Fund It
One of the most appealing aspects of Professional Administration is that either party can choose to cover the cost. Whether the payer wants to protect their financial exposure, or the injured party wants peace of mind, the fee can be allocated however the parties see fit. In return, the injured individual’s medical funds are professionally managed, reducing the risk of misuse and ensuring that all expenditures comply with Medicare Secondary Payer (MSP) guidelines.
Post-Death Fund Distribution Options
With Professional Administration, any unspent medical funds aren’t lost in a void. Instead, the parties can negotiate in advance on how those remaining funds will be dispersed. The funds may revert to the funding party, be distributed to a named beneficiary, passed to the injured individual’s estate, or any combination thereof. This flexibility adds a layer of value to the settlement that can help both sides reach an agreement faster.
Risk Transfer and Compliance Assurance
Managing a MSA properly is no small task. If funds are misused or not spent according to CMS rules, it can trigger serious consequences, including potential penalties and a loss of future Medicare benefits. By utilizing a Professional Administrator, both parties can offload this burden to a trusted third party. If a mistake occurs, the administrator, not the injured individual or the funding party, is responsible for making it right. This layer of protection provides peace of mind for all involved and ensures long-term compliance.

Bottom Line

When negotiations stall, offering Professional Administration isn’t just a logistical solution, it’s a powerful tool for bridging the gap. It helps protect all parties, enhances the value of the settlement, and can be the key to moving a tough case toward resolution.

About Medivest

Medivest

11/Apr/2025

The Centers for Medicare & Medicaid Services (CMS) presentation from the March 27, 2025, Introduction to Medicare Secondary Payer for Beneficiary Representatives webinar has been released and can be found here.

Presentation Overview

The intention of this webinar serves as a high-level introduction to the Medicare Secondary Payer (MSP) statute for beneficiaries and their representatives. Topics discussed include what the MSP is, including coordination of benefits, MSP types, the basics of the recovery process, and the Medicare Secondary Payer Recovery Portal. Additional resources are also made available in the presentation in the form of links to NGHP Recovery Webpages, important contacts, and more.

Additional information about the most recent updates from CMS can be found here. If you have questions on how topics discussed in this webinar may affect your clients or your company, please contact Medivest or call us at 877.725.2467.

Medivest

08/Apr/2025

On April 7, 2025, the Centers for Medicare & Medicaid Services (CMS) updated the MMSEA Section 111 NGHP User Guide to version 8.0. The newer version has been posted to the NGHP User Guide page, found here. The NGHP User Guide to version 8.0 replaces Version 7.9 which was released on January 17, 2025.

MMSEA III – April 7, 2025 – NGHP User Guide version 8.0 Downloads

Chapter 1: Introduction and Overview

The updates listed below have been made to the Introduction and Overview Chapter Version 8.0 of the NGHP User Guide. As indicated on prior Section 111 NGHP Town Hall teleconferences, the Centers for Medicare & Medicaid Services (CMS) continue to review reporting requirements and will post any applicable updates in the form of revisions to Alerts and the user guide as necessary. There are no changes for this version.

Chapter II: Registration Procedures

The update below has been made to the Registration Procedures Chapter Version 8.0 of the NGHP User Guide. As indicated in prior Section 111 NGHP Town Hall teleconferences, the Centers for Medicare & Medicaid Services (CMS) continue to review reporting requirements and will post any applicable updates in the form of revisions to Alerts and the user guide as necessary. To align with new WCMSA reporting requirements effective April 4, 2025, field numbers have been updated throughout this guide.

Chapter III: Policy Guidance

The updates listed below have been made to the Policy Guidance Chapter Version 8.0 of the NGHP User Guide. As indicated in prior Section 111 NGHP Town Hall teleconferences, the Centers for Medicare & Medicaid Services (CMS) continue to review reporting requirements and will post any applicable updates in the form of revisions to Alerts and the user guide as necessary. To align with new WCMSA reporting requirements effective April 4, 2025, field numbers have been updated throughout this guide.

Chapter IV: Technical Information

The updates listed below have been made to the Technical Information Chapter Version 8.0 of the NGHP User Guide. As indicated in prior Section 111 NGHP Town Hall teleconferences, the Centers for Medicare & Medicaid Services (CMS) continue to review reporting requirements and will post any applicable updates in the form of revisions to Alerts and the user guide, as necessary. A clarification has been added that the reporting threshold does apply to non-trauma no-fault and workers’ compensation cases (Section 6.4). The Event Table has been updated to include three new scenarios involving MSA corrections (Section 6.6.4). To align with new WCMSA reporting requirements effective April 4, 2025, field numbers have been updated throughout this guide.

Chapter V: Appendices

The updates listed below have been made to the Appendices Chapter Version 8.0 of the NGHP User Guide. As indicated in prior Section 111 NGHP Town Hall teleconferences, the Centers for Medicare & Medicaid Services (CMS) continue to review reporting requirements and will post any applicable updates in the form of revisions to Alerts and the user guide as necessary. To align with new WCMSA reporting requirements effective April 4, 2025, field numbers have been updated throughout this guide. To reflect improved reporting requirements, Zip+4 section guidance has been updated (Appendix A, Appendix B, and Appendix G). To ensure consistency of data, as of October 6, 2025, the Recovery Agent TIN field is required if agent name is submitted (Appendix B and Appendix G).

270/271 Health Care Eligibility Benefit Inquiry and Response Companion Guide for Mandatory Reporting Non-GHP Entities Version 6.0

The email address for contacting an Electronic Data Interchange (EDI) Representative has changed to COBVA@bcrcgdit.com. However, COBVA emails coming from CMS now show the address as COBVA@mail.cms.hhs.gov (Customer Support).

For Additional Information

Medivest will continue to monitor changes occurring at CMS and will keep its readers up to date when such changes are announced. For questions, feel free to reach out to the Medivest representative in your area by clicking here or call us direct at 877.725.2467.

Medivest

08/Apr/2025

Centers for Medicare & Medicaid Services (CMS) has revised the WCMSA Reference Guide to reflect recent changes in CMS policy and Section 111 reporting requirements. Version 4.3, dated April 7, 2025 has three notable changes:

1) A Notice of Settlement Received letter has been added to the Guide at Appendix 5 to support the new Mandatory Workers’ Compensation Medicare Set-Aside (WMSA) reporting requirements;

2) The one year waiting period for the Amended Review of MSAs has been removed from Section 16.3; and

3) The revised Reference Guide provides additional clarity around CMS’ change of MSA submitter policies (Sections 16.3 and 19.4).

For Additional Information

Medivest will continue to monitor changes occurring at CMS and will keep its readers up to date when such changes are announced. For questions, feel free to reach out to the Medivest representative in your area by clicking here or call us direct at 877.725.2467.

Sandy Simpson

07/Apr/2025

The Centers for Medicare & Medicaid Services (CMS) has released the Self-Administration Toolkit for WCMSAs version 1.7 on April 7, 2025. The Toolkit replaces Version 1.6, which was released on August 1, 2024.

To download the new Self-Administration Toolkit for WCMSA Version 1.7 click here.

Self-Administration with Additional Help

For injured parties who are considering self-administration, but also want additional consultation on the process, Medivest provides a Self-Administration Kit. With the purchase of the Medivest Medicare Set-Aside Self-Administration Kit, the injured party will receive a one-hour consultation on the proper administration of a Medicare Set-Aside account, covering topics including:

Where to deposit and hold Medicare Set-aside funds

Which expenses are allowed to be paid from a Medicare Set-Aside account

What rates must be used to negotiate and pay expenses

How to annually report the Medicare Set-aside to the CMS

What to do if the MSA funds exhaust temporarily or permanently

How to discuss a Medicare set-aside with a medical provider

What are the tax implications of interest earned on Medicare Set-Aside funds

For Additional Information

Medivest will continue to monitor changes occurring at CMS and keep its readers updated when such changes are announced. For questions about self-administration, professional administration or anything else regarding rules and recommendations from CMS, feel free to contact the Medivest representative in your area by clicking here or calling us at 877.725.2467.

Medivest

01/Apr/2025

Starting April 4, 2025, significant changes are coming to Section 111 reporting requirements for workers’ compensation claims involving Medicare beneficiaries. If you’re a Responsible Reporting Entity (RRE), it’s time to prepare for a broader scope of data reporting, especially when it comes to Workers’ Compensation Medicare Set-Asides (WCMSAs).

Under the new requirements, all workers’ compensation claims involving a Total Payment Obligation to the Claimant (TPOC) must now include WCMSA-related data when the injured party is a Medicare beneficiary. This applies regardless of whether the WCMSA was reviewed or approved by Medicare. CMS has updated reporting requirements published in the NGHP User Guide of the MMSEA Sections 111, which you can view the following chapters below.

Here is a breakdown of what needs to be reported:

1. Medicare-Approved WCMSAs:
  - If your settlement includes a WCMSA that was reviewed and approved by CMS, you must report the relevant WCMSA data.
2. WCMSAs Below the Review Threshold:
  - Even if the WCMSA wasn’t submitted for CMS review because the total settlement amount falls below the Medicare workload review threshold, the WCMSA information still needs to be reported.
3. Zero-Dollar WCMSAs:
  - When a settlement explicitly states that no funds are allocated for future medical care, this is considered a Zero-Dollar WCMSA. These must also be reported.
4. Unsubmitted WCMSAs:
  - If the parties developed an MSA or allocated funds for future medical treatment but chose not to submit it to Medicare, that information must now be disclosed.

What Should You Do Now?

If you’re a claims professional, insurer, or third-party administrator, be prepared to:

- Review your Section 111 reporting processes and confirm they can handle the new data requirements that can be found.
- Coordinate with your WCMSA vendors to ensure you receive the necessary data for inclusion in your reporting.
- Educate your claims team and legal partners about the upcoming changes so all parties are aligned before April 4.

Takeaways

The expanded Section 111 reporting requirements reflect CMS’s ongoing efforts to protect the Medicare Trust Funds. While they may add complexity to the reporting process, these changes also provide an opportunity for claims handlers to strengthen compliance and improve documentation practices.

For Additional Information

As always, Medivest remains committed to assisting our clients with the creation and administration of WCMSAs. Medivest will continue to monitor changes occurring at CMS and will keep our readers up to date when any new changes are announced. For questions, feel free to reach out to the Medivest representative in your area by clicking here or call us at 877.725.2467.

Medivest

06/Mar/2025

CMS will be hosting an Introduction to MSP for Beneficiary Representatives webinar. The intent of this webinar is to support the attorney and beneficiary representative communities and review the basics of MSP, Group Health vs. Non-Group Health Coordination of Benefits, and MSP recovery. The presentation will be followed by a question-and-answer session.

Date: March 27, 2025
Time: 1:00 PM ET

Webinar Link: https://cms.zoomgov.com/j/1602933030?pwd=CS3jdG0Whh8BcACklF4Dwi3OU9zuCc.1
Passcode: 082211

Or to connect via phone:

Conference Dial In: 1-833-568-8864
Conference Passcode: 160 293 3030

Important Note: This is a public webinar and there is no pre-registration. The link above will not be active until the day of the webinar.

Additional information about the most recent updates from CMS can be found here. If you have questions on how topics discussed in this webinar may affect your clients or your company, please contact Medivest or call us at 877.725.2467.

Sandy Simpson

29/Jan/2025

When Medicare’s interests (past and/or future) are not considered, are you aware of the unintended consequences which may affect the parties to the settlement? The Centers for Medicare and Medicaid Services (CMS) WCMSA Reference Guide v 4.2, found here, provides language regarding their views and remedies. Understanding CMS’ views and consequences is a good step in helping a party navigate the often-confusing settlement process as it relates to staying compliant with the Medicare Secondary Payer (MSP) statute.

Conditional Payment Recovery

Medicare has a right to seek reimbursement for the conditional payments it makes to providers where another payer may be responsible. The payment by Medicare is conditioned on Medicare taking on recovery at the appropriate time and therefore, is termed to be a “conditional payment” because it must be repaid to Medicare once the settlement occurs. However, when the conditional payments have not been repaid, Medicare may take the following actions:

Priority Right of Recovery or “Super Lien” – Medicare has a Priority Right of Recovery or “Super Lien” without the need to file any notice in a court. CMS states, “If Medicare’s interest is not considered, CMS has a priority right of recovery against any entity that received any portion of a third-party payment directly or indirectly – a right to recover or take back, that payment.”

Subrogation Rights – CMS states, “Medicare has a subrogation right to any such payment it has made. Subrogation means the substitution of one person or entity for another. If Medicare exercises its subrogation rights, Medicare becomes a claimant against the responsible party and/or the liability insurer/medical provider to the extent that Medicare has made payments to or on behalf of the beneficiary for services related to claims against the responsible party and the responsible party’s liability insurance. While Medicare can pursue recovery directly from the responsible party through their “pay and chase” method, utilizing subrogation is usually less common.”

Charging Interest – Additionally, Medicare may and does regularly charge interest on this type of MSP conditional payment debt when a demand has remained unpaid for 60 days. The interest rate is currently over 12%. This can be a factor in how the entities and claimants choose to address any appeals or request to waive the MSP debt. After 120 days from the debt of the demand, the MSP debt may be transferred to the Department of Treasure (DOT) for various DOT collections actions. The most common remedies exercised when the debt is referred to the DOT is the Treasury Off-Set Program or Private Collection Action (PCA).

Referral to the Treasury Department – CMS states, “When the outstanding debt has moved through Medicare’s recovery process, and it is still unpaid, the debt is referred to the Treasury Offset Program (TOP) for further collection activities. The TOP may garnish the beneficiary’s Social Security benefits or seize the primary plan’s federal tax refund.”

Referral to the Department of Justice – CMS states, “The Centers for Medicare and Medicaid Services (CMS) may refer the debt to the Department of Justice (DOJ) for legal action if it determines that the required payment or a properly documented defense has not been provided. The law authorizes the Federal government to collect double damages from any party that is responsible for resolving the matter, but which fails to do so.”

CMS’s Views – NSMSA / EBMSA / WCMSA

CMS has stated that there are no statutory or regulatory provisions requirements to submit a WCMSA amount proposal to CMS for review. As a result, there has been an increase in defendants using Non-Submit Products – MSAs (NSMSA) or Evidence-Based MSAs (EBMSA) instead of having the traditional WCMSA Arrangement prepared and submitted to CMS for review. While there are some similarities in these reports in respect that they each attempt to estimate the future Medicare covered medicals which are likely to be encountered by the injured party after settlement, there are substantial differences in the projection methodology that could open settling parties up to risks.

Non-Submit Medicare Set-Aside (NSMSA) Report – The NSMSA report meets workload review thresholds but is a report (by definition) is not submitted to CMS for review and approval. The defendant may decide to use a non-submit MSA allocation report to speed up the settlement process and because it often projects a lower amount of money for the claimant’s future injury-related Medicare covered medicals (FIRMCM) than a traditional WCMSA written by the WCMSA Reference Guide standards.

Evidence-Based Medicare Set-Aside (EBMSA) Report – The EBMSA report is based on the injured party’s medical records and research trends. When an EBMSA report is used, the parties do not intend to submit the EBMSA to CMS for review and approval. The report’s projection would be guided by evidence-based medicine standards with the treating physician’s recommendations. It uses established evidence-based standards of care to create a medically and legally defensible assessment of the injured party’s future medical needs.

WCMSA Arrangement – The WCMSA report follows CMS’ guidelines when preparing reports and submitting to CMS for review. As part of CMS’ guidelines, they required the report to use average wholesale prices (AWP) to price Medicare Part D drugs, confirm jurisdiction to apply correct fee schedules for treatments, and to use ICD-10 mandatory diagnosis and procedure codes. When reviewing the WCMSA, CMS assesses whether the proposed amount of funds set aside for future medical expenses aligns with Medicare’s standard of care protocols, essentially checking if the proposed treatment plan and cost are considered reasonable and appropriate based on Medicare guidelines for similar conditions.

CMS’ Views – Traditional WCMSAs Arrangements

Below are some of CMS’ views found in section 3.0 of the WCMSA Reference Guide:

“Medicare may also refuse to pay for future medical expenses related to the WC injury until the entire settlement is exhausted.”
“The WCMSA amount review process is the only process that offers both Medicare beneficiaries and Workers’ Compensation entities a finality, with respect to obligation for medical care required after a settlement, judgement, award, or other payment occurs.”
“Once the CMS-approved set-aside amount is exhausted and accurately accounted for to CMS, Medicare will pay primary for future Medicare-covered expenses related to the WC injury that exceed the approved set-aside amount.”

Changes to WCMSA Ref Guide -Section 4.3 – Non-Submit MSA Products

The Medivest blog written on February 3, 2022, titled The Further Review of Section 4.3 of the New WCMSA Reference Guide found here, which outlines the consequences when using the Non-Submit MSA’s products. Below are some of the primary takeaways from that blog:

The party with the most to lose is the beneficiary. The primary consequence referenced in 4.3 is denial of payment for the beneficiary’s injury-related care in the event of MSA exhaustion. CMS says it will continue to deny payment until the entire net settlement has been fully spent down (not the total MSA amount). This could occur in events of permanent exhaustion or during temporary exhaustion periods, when the beneficiary’s MSA is exhausted until the next funding payment is received. Keep in mind that this doesn’t apply to MSAs that do not meet the review threshold. Also, there is an appeal process for denial of payment. But the greatest risk-bearer is the applicant.
Since MSA exhaustion represents the greatest risk to the applicant, a program of proper funds administration is preferable. A burden shift to Medicare can only occur once Medicare becomes the primary payer. An MSA that remains solvent will maintain Medicare’s payment position as secondary indefinitely. While it is impossible to foresee every expense that an MSA may incur over an applicant’s lifetime, a properly funded MSA in the hands of a competent administrator is the best protection of the interests of both Medicare and the applicant.
Thoughtful consideration should be given to the adequacy of an evidence-based or non-submit program. It is entirely possible to produce a fully adequate and reasonable MSA without CMS’s review and approval. However, not all products are created equally. It’s important to be confident that the methodology in use produces MSAs that consider Medicare’s interests sufficiently.

Mismanagement of WCMSA Accounts

An injured party may choose to self-administer their WCMSA funds or have it professionally administered. However, in either case when the funds have not been properly managed and have been misspent, the consequences could be:

If the WCMSA account is not set up, the beneficiary’s Medicare eligibility could be in jeopardy at least to the extent of the injury related FIRMCM claims.
Funds may need to be added to the WCMSA before Medicare pays for FIRMCM.
Medicare can deny payment of future injury-related medicals if the WCMSA funds are not properly used or exhausted.
If the carrier fails to report ORM and/or TPOC/Settlements timely, the carrier may be fined for Civil Monetary Penalties starting in April of 2025 as described in a previous blog. If attestations are not timely delivered to CMS for WCMSA’s, Medicare may deny injury-related treatment until reporting is corrected.

Need for Professional Administration

The mismanagement of funds can negatively affect the beneficiary’s Medicare benefits and delay treatment. That’s why hiring a Professional Administrator can help remove the burden from the injured party/beneficiaries from paying claims, managing funds, and providing attestation report to CMS. Keep in mind CMS states, “Although beneficiaries may act as their own administrators, it is highly recommended that settlement recipients consider the use of a professional administrator for their funds.”

How to Avoid Medicare’s Consequences

Call Medivest 877.725.2467 to speak with one of our case consultants who will help you navigate a plan that evaluates Medicare’s past and future interests in a settlement or hopeful settlement.
Medivest investigates and assists with the resolution of Medicare’s conditional payments in WC claims on behalf of an employer/carrier/TPA and can act as the eyes of the claimant to make sure that the carrier is paying its share of accepted injury related conditional payments.
Medivest investigates and assists with the resolution of Medicare’s conditional payments, or those of Medicare Advantage Plans (Part C), Prescription Drug Plans (Part D), Department of Veterans Affairs (VA), TRICARE, ERISA, and privately administered insurance plans for liability cases when referred to by the plaintiff’s attorney.
Medivest prepares WCMSA, LMSA and Medical Cost Projection (MCP) reports
Medivest submits WCMSA allocation reports to CMS for review when allowed and desired.
Medivest professionally administers MSA Funds for WC and Liability MSAs. Hire Medivest for Professional Administration to manage the MSA funds.

About Medivest

Older Posts

Below is a list of the 5 plans deemed primary to Medicare by the statute:

How Will Medicare Find Out About My Case?

Determining if a Medicare Set-Aside (MSA) arrangement is the right choice for your case depends on several factors

About Medivest

Why Do Settlements Stall?

The Fix: Professional MSA Administration

Bottom Line

About Medivest

Presentation Overview

MMSEA III – April 7, 2025 – NGHP User Guide version 8.0 Downloads

For Additional Information

For Additional Information

Self-Administration with Additional Help

For Additional Information

What Should You Do Now?

Takeaways

For Additional Information

Conditional Payment Recovery

CMS’s Views – NSMSA / EBMSA / WCMSA

CMS’ Views – Traditional WCMSAs Arrangements

Changes to WCMSA Ref Guide -Section 4.3 – Non-Submit MSA Products

Mismanagement of WCMSA Accounts

Need for Professional Administration

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