cms - Solutions for Workers' Compensation and Liability Settlements

22/May/2023

On Tuesday, June 6th, Centers for Medicare & Medicaid Services (CMS) will be hosting a webinar regarding the upcoming implementation of the Section 111 NGHP Unsolicited Response File option. The full notice can be read below:

Section 111 Non-Group Health Plan (NGHP) Unsolicited Response File Webinar Tuesday June 6, 2023

Mandatory Reporting for Liability Insurance (including Self-Insurance), No-Fault Insurance and Workers’ Compensation

CMS will be hosting a webinar regarding the upcoming implementation of the Section 111 NGHP Unsolicited Response File option. The format will be opening remarks by CMS, a presentation that will include background as well as how to opt in and what to expect, followed by a question and answer session. For questions regarding this topic, prior to the webinar, please utilize the Section 111 Resource Mailbox PL110- 173SEC111-comments@cms.hhs.gov.

Date: June 6, 2023
Time: 1:00 PM ET

Webinar Link: https://cms.zoomgov.com/j/1601170809?pwd=YU1YN3BGYjhKWTNBR3AyT3o4emFWQT09

Passcode: 558113

Or to connect via phone

Conference Dial In: 1-833-568-8864
Conference Passcode: 160 117 0809

Due to the number of expected participants please log in at least 10 minutes prior to the start of the presentation.

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

Medivest

29/Mar/2023

On March 8th, 2023, Centers for Medicare & Medicaid Services (CMS), via Deputy Administrator and Director Daniel Tsai, offered its first official notification regarding the Gallardo v. Marstiller U.S. Supreme Court ruling to all state Medicaid agencies. The notification reiterates the requirement of state Medicaid agencies to recover their injury-related payments (liens) from settlement funds. It informs them that now those lien payment recoveries can be recovered from any portion of settlement funds designated as compensation for medicals. This includes funds considered to be compensation for future medicals of a Medicaid member.

A Brief Review of Gallardo v. Marstiller

In 2022, the Supreme Court of the United States (SCOTUS) took on the case of Gallardo v. Marstiller. At question was whether Florida’s Medicaid program was only entitled to be reimbursed for the money it spent for a Medicaid beneficiary’s past medicals from both the portion of the settlement that represents future medical expenses and past medical expenses or only from the portion of the settlement allocated as past medicals. The SCOTUS affirmed 7-2 that the Medicaid Act permits a State to seek reimbursement from settlement payments allocated for future medical care in addition to payments allocated to past medicals.

Medivest followed the case and decision closely in 2022, and documented the details and some new questions that the decision opened up. One of those questions was, would state Medicaid agencies and their recovery agents become more aggressive in pursuing their reimbursement/lien recoveries from any and all medical damages paid in settlements? The letter from the Deputy Administrator and Director, RE: Third-Party Liability in Medicaid: State Compliance with Changes Required in Law and Court Rulings, seems to indicate that the answer is yes.

CMS Letter – SMD # 23-002

In the letter from the Deputy Administrator and Director, the Gallardo ruling is referenced as reason for pursuing past medical payments (i.e. liens) from the future medical portions of a settlement or past medical portions of a settlement. Additionally, the Consolidated Appropriations Act, 2022 (CAA, 2022; P.L. 117-103) is referenced. This requires states to have laws in effect that bar liable third-party payers from refusing payment for an item or service solely on the basis that such item or service did not receive prior authorization under the third-party payer’s rules.

It is worth mentioning, the letter does not expand the law. It is CMS’s attempt to help remind the various state Medicaid agencies of their ongoing obligation to recover their liens and that now, post Gallardo, they may reach into any medicals to recover those liens. The full letter can be read here.

Questions Regarding Lien Resolution?

Medivest will continue to assist injured parties by auditing Medicaid lien payment ledgers to confirm only injury-related payments are reimbursed, and in negotiating the resolution of any Medicaid liens from traditional Medicaid lien holders and privately administered Medicaid Managed Care Organization (MCO) health plans. We are always working to find ways to reasonably reduce the overall reimbursement for the injured parties.

For additional questions regarding lien resolution, please contact us here.

Sandy Simpson

27/Feb/2023

In what has become a familiar sight for Medicare Secondary Payer (MSP) rule watchers, CMS has released a notice to delay a proposed rule. This time it is in regard to Section 111 civil money penalty regulations that were announced three years ago. The final rule has now been pushed back for an additional year.

The Proposed Rule

On February 18, 2020, the Proposed Rule regarding MSP and Certain Civil Monetary Penalties (CMPs) 85 Fed. Reg. 8793 was released, and the agency opened a public comment period to allow for feedback until April 20, 2020. CMS was expected to complete and release its final rule within the standard three-year period for release, which in this instance would be sometime on or before February 2023. The proposed rule can be found here.

Section 111 Background

The Section 111 penalty provision, which allows the Centers for Medicare and Medicaid Services (CMS) to impose Civil Monetary Penalties against NGHP RREs as follows:

- Up to $1,000 for each day of noncompliance with respect to each claimant.
- Up to $1,000 penalty amount will be adjusted annually for inflation under 45 CFR part 102.
- Current maximum penalty amount as adjusted for inflation is $1,247.
- As part of its NPRM, CMS outlines proposed situations when it could impose a CMP, along with specific instances when it would not impose a CMP.
Summary

This final proposed rule specifies how and when CMS must calculate and impose civil money penalties (CMPs) when group health plan (GHP) and non-group health plan (NGHP) responsible reporting entities (RREs) fail to meet their MSP reporting obligations in any one or more of the following ways: When RREs fail to register and report as required by MSP reporting requirements; when RREs report as required, but report in a manner that exceeds error tolerances established by the Secretary of the Department of Health and Human Services (the Secretary); when RREs contradict the information the RREs have reported when CMS attempts to recover its payments from these RREs. This proposed rule would also establish CMP amounts and circumstances under which CMPs would and would not be imposed.

Extension Timeline for Publication of Final Rule

On February 18, 2023 the Federal Register published the Medicare Secondary Payer of Certain Civil Money Penalties, Extension of Timeline of Final Rule. Along with the filing, CMS admitted it was “not able to meet the initial targeted 3-year timeline for publication due to delays related to the need for additional, time-consuming data analysis resulting from public inquiry.” The agency has extended the timeline for another year and has until February 18, 2024 to release the announcement. Click here to read the memo.

Stay Informed

If you would like to stay current on CMS updates, industry changes, and the latest happenings at Medivest, please sign up today for the Medivest blog. All updates will be sent directly to your email the day they are posted. For additional questions regarding any new regarding CMS or MSP Compliance please contact us here.

Medivest

17/Nov/2022

On Tuesday, December 6, 2022, Centers for Medicare & Medicaid Services (CMS) will be hosting a webinar entitled, “Mandatory Reporting for Liability Insurance (including Self-Insurance), No-Fault Insurance and Workers’ Compensation”. The full notice can be read below:

CMS will be hosting a Section 111 NGHP webinar. The format will be opening remarks by CMS, a presentation that will include NGHP reporting best practices and reminders followed by a question and answer session. For questions regarding Section 111 reporting, prior to the webinar, please utilize the Section 111 Resource Mailbox PL110- 173SEC111-comments@cms.hhs.gov.

Date: December 6, 2022
Time: 2:00 PM ET

Webinar Link: https://cms.zoomgov.com/j/1604816351?pwd=QmlUVUl1MkU4Y3htY1J0M0tUN3hoUT09

Passcode: 001534

Or to connect via phone:

Conference Dial In: 1-833-568-8864
Conference Passcode: 160 481 6351

Due to the number of expected participants please log in at least 10 minutes prior to the start of the presentation.

Sandy Simpson

15/Nov/2022

The Centers for Medicare & Medicaid Services (CMS) released a revised Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide (“Reference Guide”) Version 3.8 on November 14, 2022. This Reference Guide replaces Version 3.7 which was released on June 6, 2022. There are a few notable changes when comparing the two Reference Guides.

CMS’s Version 3.8 Reference Guide, Section 1.1 includes the following changes:

Changes in This Version of the Guide Version 3.8 of this guide includes the following changes: Clarification has been provided regarding re-review requests when errors exist in the submission documentation, as well as re-review limitations (Sections 16.1 and 16.2). Note: These re-review changes are only available for approvals from September 1, 2022 forward.

To download the new WCMSA Reference Guide v3.8 Click Here.

For your convenience, we have included the entirety of Section 16.1 and 16.2, so you will have the most up to date information regarding the process of re-review:

16.1 Re-Review

When CMS does not believe that a proposed set-aside adequately protects Medicare’s interests, and thus makes a determination of a different amount than originally proposed, there is no formal appeals process. However, there are several other options available. First, the claimant may provide the WCRC with additional documentation in order to justify the original proposal amount. If the additional information does not convince the WCRC to change the originally submitted WCMSA amount and the parties proceed to settle the case despite the lack of change, then Medicare will not recognize the settlement. Medicare will exclude its payments for the medical expenses related to the injury or illness until WC settlement funds expended for services otherwise reimbursable by Medicare use up the entire settlement. Thereafter, when Medicare denies a particular beneficiary’s claim, the beneficiary may appeal that particular claim denial through Medicare’s regular administrative appeals process. Information on applicable appeal rights is provided at the time of each claim denial as part of the explanation of benefits.

A request for re-review may be submitted based one of the following:

Mathematical Error: Where the appropriately authorized submitter or claimant disagrees with CMS’ decision because CMS’ determination contains obvious mistakes (e.g., a mathematical error or failure to recognize medical records already submitted showing a surgery, priced by CMS, that has already occurred), or

Missing Documentation: Where the submitter or claimant disagrees with CMS’ decision because the submitter has additional evidence, not previously considered by CMS, which was dated prior to the submission date of the original proposal and which warrants a change in CMS’ determination.

- Disagreement surrounding the inclusion or exclusion of specific treatments or medications does not meet the definition of a mathematical error.

- Re-Review requests based upon failure to properly review already submitted records must include only the specific documentation referenced as a basis for the request.
- Should no change be made upon response to a re-review request (i.e., no error was identified), additional requests to re-review the same error will not be entertained.

Submission Error: Where an error exists in the documentation provided for a submission that leads to a change in pricing of no less than $2500.00, a re-review request may be made by submitting updated documents free of errors that caused the original review outcome. Amended documents must come from the originators with appropriate notation to identify that the error was corrected, along with the date of correction and no less than hand-written “wet” signature of the correcting individual. Note: This submission option is only available for approvals from September 1, 2022 forward.

- Examples include, but may not be limited to; medical records with incorrect patient identifying information or rated ages where the rated-age assessor provided incorrect information in the rated-age document.

16.2 Re-Review Limitations

Note: The following re-review limitations are only available for approvals from September 1, 2022 forward.

Re-review shall be limited to no more than one request by type.

Disagreement surrounding the inclusion or exclusion of specific treatments or medications does not meet the definition of a mathematical error.

Re-Review requests based upon failure to properly review already submitted records must include only the specific documentation referenced as a basis for the request.

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.

Natt Reifler, Esq., CMSP, VP of MSP Compliance

26/Oct/2022

On October 13, 2022, in a surprise move, CMS withdrew its Notice of Proposed Rulemaking (“NPRM”) pertaining to the protection of Medicare’s future interests in liability and other Non Group Health Plan (“NGHP”) settlements, judgments, awards, payments, or other arrangements (“Settlements”) without any official or unofficial comment. Many people in the Medicare Secondary Payer Compliance industry felt that this NPRM, most recently announced in 2018 and continued for several years, was finally going to add CMS’s clarifying “take” on how it would suggest settling parties reasonably consider and protect Medicare’s future interests in liability Settlements and that CMS would issue regulations or guidance specific to Liability Medicare Set-Asides (“LMSAs”).

The most recent 2018 iteration of the NPRM was designed to address protection of Medicare’s future interests in any NGHP Settlement, including removing what it considered obsolete regulations. For the past several years, stakeholders in the MSP compliance community have been waiting and speculating how such regulations could be devised to account for all the convoluted factors that exist in liability claims while adding clarity to steps CMS might suggest to be taken to protect Medicare’s interests in liability settlements.

Earlier in 2022, there had been a stakeholder meeting as well as a letter from the MARC coalition urging CMS to not move forward with the NPRM. It seems that the MSP compliance stakeholder community once again rallied and provided enough reason to give CMS pause. Some have called into question whether the MSP as enacted, gives CMS authority to issue regulations regarding liability futures, and some court decisions discussing liability MSAs and the need for an exhaustion of administrative remedies prior to a court of competent jurisdiction being able to review a LMSA proposal, may have also contributed to CMS’s decision to not move forward with this NPRM at this time.

The argument follows if federal courts have determined it is premature to review proposed LMSAs due to the failure of a party to exhaust their administrative remedies with CMS, then how could CMS insert its own administrative review process via guidance or regulation, unless the MSP were amended to provide for that authority. Examples of court cases discussing these issues, include Silva v. Burwell, 2017 WL 5891753 (D. N.M. 2017); Sipler v. Trans Am Trucking, Inc., 881 F.Supp. 2d 635 (D. N.J. 2012); Bruton v. Carnival Corporation, 2012 WL 1627729 (S.D. Fla. 2012); Abate v. Wal-Mart Stores East, L.P., 2020 WL 7027481 (W.D. Pa. November 30, 2020); and Stillwell v. State Farm, et. al., 2021 WL 4427081 (M.D. Fla., September 27, 2021).

TAKE AWAYS:

The MSP still forbids Medicare from making payment when a primary plan is in place meaning if there is a Settlement from a NGHP plan including from a liability carrier or self-insured defendant, Medicare has a statutory lien right under the MSP to recover its conditional payments minus procurement costs and can charge high interest and potentially even double damages for non-compliance.
If a current Medicare beneficiary settles a liability case, they should be informed about the MSP and a plan for future care should be set in place. The federal law is clear that conditional payments could arise prior to or after a settlement, so a risk tolerance cost benefit analysis should be performed between attorney and plaintiff as to the best steps to ensure Medicare is not prematurely billed.
Medicare has the right under the MSP to deny payment for injury related future Medicare covered medicals (items, services, and expenses, including Prescription Drug Expenses). Will it? We have seen times when it has flagged liability cases even while a liability claim or portion of a liability claim is pending (often because it believes the matter was settled but it was only settled with one of several defendants/carriers). While CMS does not seem to regularly do this, the goal for an attorney representing an injured plaintiff is to provide a settling plaintiff with enough information to make an informed decision regarding what is the best course of action for them and to document what decision was made after such informed consent was provided.
Only two federal circuits (3^rd and 11^th) have held Medicare Part C – Medicare Advantage Plans (MAPs) to have identical recovery rights as traditional Medicare under the MSP. However, those MAPs still have contractual subrogation rights, and attorneys representing Defendants, as well as attorneys representing their plaintiff clients, should evaluate whether any MAP plan or Medicare Part D – Prescription Drug Plan (PDP) have a subrogation/lien interest to be reimbursed for pre-settlement payments that were compensated by the Settlement.
Each attorney should provide their clients with enough information to help them assess their risks and to determine if denial of injury related future medicals or the potential for recovery of future conditional payments by Medicare is a risk they are willing to take. There are a wide range of products being offered to address MSP exposure and to protect Medicare’s interests in liability settlements based on the varying risk tolerance levels of your client. Count on Medivest to help you spot these intricacies so you can deliver prudent advice to your clients.

As background, the Medicare Secondary Payer Statute, found at 42 U.S.C. Section 1395y(b)(2), or most commonly known as the MSP, is the federal law enacted in 1980 that amended the Social Security Act and its Medicare specific amendments to make health plans other than Workers’ Compensation to be primary to Medicare. Workers’ Compensation plans were primary to Medicare from Medicare’s enactment into law in 1965. The MSP was Congress’ mandate to Medicare and The Centers for Medicare & Medicaid Services (“CMS”), the subagency that administers Medicare, forbidding Medicare from making payments when a primary plan was in place to promptly make payment. The primary plans are liability including self-insureds (and automobility BI), No Fault, and Worker’s Compensation and are known as the Non Group Health Plans (NGHP) to be distinguished from Group Health plans that offer health care insurance. While No Fault claims and Workers’ Compensation claims are typically paid immediately upon a claim being filed and accepted for Ongoing Responsibility for Medicals (“ORM”), liability carriers rarely accept responsibility to make payments early on in the life of a liability case. Liability carriers may choose to offer a settlement but almost never accepts liability.

Because the regulations under the MSP define prompt payment as within 120 days, the MSP also allows Medicare to make payments for medical services when a Medicare beneficiary will be compensated by a defendant in a liability case or their/its primary plan carrier under the condition that Medicare be able to recover those conditional payments it made that were claim related and compensated by a settlement, judgment, award, or other arrangement (collectively, “Settlement”). The MSP makes the primary plan Defendant, and any person or entity who receives a part of the Settlement proceeds, jointly and severally liable for repayment of conditional payments. The law also allows for interest and potentially double damages against liable people and entities that fail to make payment promptly.

The payment by any NGHP plan is what triggers the MSP’s recovery rights under the law regardless of whether liability is accepted or not. The protection of exposure to the MSP’s recovery rights is also commonly referred to as protecting Medicare’s past and future interests in a Settlement. Protecting Medicare’s past interests in a settlement includes providing notification of a claim and checking with CMS to determine whether it is claiming any payments it has made from the date of an injury up to the date of settlement are conditional payments to be reimbursed. Plaintiff attorneys typically provide this type of notification or hire third parties to confirm whether there are any conditional payments and then report settlement details to obtain a discount from the conditional payment amount and obtain a demand from CMS reflecting a deduction for pro-rated fees and expenses allowed under the regulations to the MSP.

The regulations to the MSP include some regulations that are generally applicable to any of the NGHP plans and some that are specific to Workers’ Compensation claims and Settlements. CMS has never promulgated regulations that are specific to liability claims or No Fault claims and Settlements. CMS has also issued guidance regarding the protection of Medicare’s future interests in Workers’ Compensation claims and Settlements via its Workers’ Compensation Medicare Set-Aside Arrangement (“WCMSA”) Reference Guide, now in version 3.7 issued June 6, 2022.

In 2012, CMS issued a Notice of Proposed Rulemaking regarding the protection of Medicare’s future interests in settlements intended to extend from the already regulated area of Workers’ Compensation (“WC”) Settlements to the other NGHP areas and even solicited comments from the MSP stakeholder community. After many entities pointed out the extreme differences between liability claims and WC claims such as issues of comparative or contributory negligence, the fact that liability claims often contain awards for Pain and Suffering, Loss of Enjoyment of Life, Loss of Consortium for married plaintiffs, etc., CMS ultimately withdrew that NPRM in 2014.

Sandy Simpson

15/Aug/2022

Consider this scenario: you are a personal injury attorney, and you get a call from a new client who is 63 years old and is interested in settling her automobile accident case. Per the Medicare Secondary Payer statute and as part of the case workup, you need to make sure you are not shifting the burden to Medicare.

What is the Medicare Secondary Payer Statute?

The MSP statute was passed by Congress in 1980 in order to protect the financial integrity of the Medicare Trust Fund. Per this statute/law, Medicare is a secondary payer for workers’ compensation, no-fault insurance, liability insurance, self-insured plans, and employer group health plan insurance. According to the MSP regulations, these other sources of health care coverage are to be the primary payer, with Medicare being the secondary form of payment.

What is a Medicare Set-Aside (MSA) Proposal?

A MSA proposal is a detailed report indicating the anticipated Medicare allowable, Injury-related expenses for the remainder of the injured individual’s life expectancy. It is a calculation that determines a dollar amount that should be “set aside” as part of the settlement process to satisfy the Medicare Secondary Payer Statute (MSP) and to avoid shifting the burden to Medicare.

Guidance from Medicare for Liability Cases

The Centers for Medicare and Medicaid Services (CMS) published the WCMSA Reference Guide to help attorneys understand the process CMS uses for approving proposed Workers’ Compensation MSA (WCMSA) arrangements. The purpose of the WCMSA Reference Guide was to consolidate and supplant all the historical CMS memos into a single point of reference.

However, Workers’ Compensation and Liability settlements have several different nuances. CMS has yet to release the long-awaited LMSA Reference Guide for liability settlements, despite announcing its intention to do so in 2018. Given the current lack of guidance concerning Liability MSAs from CMS, attorneys should look to the WCMSA Reference Guide for guidance when settling their liability cases.

Litmus Test – Is a MSA Proposal Recommended?

In order to determine if a MSA allocation is recommended to cover Medicare’s interest in your settlement, there are several key items to review. Attorneys can do a quick MSA litmus test to determine whether or not a MSA is recommended.

Your client is currently Medicare-eligible
Your client is 62.5 years old and within 30 months of becoming eligible for Medicare benefits
Your client has either applied for Social Security Disability Insurance (SSDI) or has an open or pending application Will there be any money after medical liens have been resolved to fund a Medicare Set-Aside (MSA) account?

Medicare Eligibility

What is Medicare’s criteria for an individual to become Medicare eligible? Medicare is available for people aged 65 or older, younger people with disabilities, and people with End Stage Renal Disease (permanent kidney failure requiring dialysis or transplant).

Social Security Disability Insurance (SSDI)

An individual who has either applied or has reapplied for Social Security Disability Insurance can become Medicare eligible. Social Security Disability Insurance (SSDI) is a federal program that helps those who have become disabled from work. An individual can apply for SSDI when:

A person is unable to engage in any “substantial gainful activity” due to an illness or disability and;
When a person is not able to return to work for 12 months or more and;
When a person has accumulated enough work credits in the last 10 years to qualify.

30 Months to Become Medicare Eligible

The reason why it takes 30 months to become Medicare eligible after the individual has either applied or reapplied for SSDI is that:

The individual needs to wait one month after the date of injury to apply for SSDI.
After the SSDI applicate date, there is a waiting period of 5 months to receive SSDI entitlement.
From the date of SSDI entitlement, Medicare has 24 months waiting period to become Medicare eligible.

Medicare Set-Aside (MSA) – Not Required by Law

Did you know that a Medicare Set-Aside is not required by law? You should know the risks if you choose not to have a MSA prepared, by understanding CMS’ interpretation regarding MSP compliance. In the event there was a failure to address Medicare’s interest in the settlement, Medicare may refuse to pay future medical expenses that are injury-related until the entire settlement is exhausted.

Best Practices

Our highly trained Medicare Expert Case Advisors can help you figure out if Medicare may have an interest in your settlement. We assist all settling parties to navigate the MSP complexities and provide you with cost-saving strategies for your settlement.

To receive our complimentary MSA Decision Tree, “When Is a MSA Allocation Recommended?” click here.

Craig Pawley, Vice President of Business Development

06/Jun/2022

On Jan 11^th, 2022 Centers for Medicare & Medicaid Services (CMS) updated its WCMSA Reference Guide to include information related to non-submit MSA products and how it views them in terms of exposure for Medicare. Then on March 15, 2022, CMS updated its Reference Guide again. We blogged about each updated guide here: WCMSA Reference Guide Version 3.6 Updates of Significance.

In the Workers’ Compensation arena, there are a number of MSA products that do not adhere to standard CMS methodology for preparing a Medicare Set-Aside allocation as outlined in the WCMSA Reference Guide. Since these products do not follow CMS methodology, submitting these types of products for approval will typically result in CMS countering higher to an amount aligned with CMS methodology standards. If a non-submit MSA product is used in WC settlements, CMS has indicated it will not step in and become the primary payer once the MSA funds have been exhausted unless the beneficiary can prove the MSA was properly funded and that all of the MSA funds were used in accordance with CMS guidelines. If CMS determines that the MSA was underfunded, it has indicated it will or at least may deny payment for case related, Medicare covered items, services, and expenses, up to the Medicare beneficiary’s net settlement amount.

The recent WCMSA reference guide updates demonstrate that Medicare believes some non-submit WCMSA allocation reports are potentially shifting the burden of payment for future medical items, treatment, and prescriptions to Medicare. While non-submit WCMSAs that meet workload review thresholds are not automatically deemed to not protect Medicare’s interest, it seems that CMS has created a presumption of this unless the injured worker can show otherwise. In comes solid allocation methodology and perhaps more importantly, the professional administrator, offering tools and assistance to show that both the amount was reasonable and that the money set aside was properly exhausted.

Why is this important for liability settlements? In the liability arena, CMS has yet to issue any new guidelines with respect on to how to handle liability settlements for a Medicare beneficiary. The May 25, 2011, Stalcup Memo from a CMS Regional Office in Texas indicated that there should be no difference between how Medicare’s interests would be protected between liability and Workers’ Compensation. It indicated that “The law requires that the Medicare Trust Funds be protected from payment of future services whether it is a Workers’ Compensation or liability case. There is no distinction in the law.” The Stalcup Memo announced that “CMS does expect the funds to be exhausted on otherwise Medicare covered and otherwise reimbursable services related to what was claimed and/or released before Medicare is ever billed.” It further cautions that “each attorney is going to have to decide, based on the specific facts of each of their cases, whether or not there is funding for future medicals and if so, a need to protect the Trust Funds.”

The new WCMSA Reference Guide has indicated that unless a prior memo is specifically referenced in the Reference Guide, it should not be relied upon. However, the Federal Statute, The Medicare Secondary Payer Statute, 42 U.S.C. Section 1395y(b) has itself not ever made a distinction between liability and Workers’ Compensation settlements and prohibits Medicare from making payment for any injuries compensated by a primary plan a/k/a Non Group Health Plan payment (including payments, settlements, judgments, awards, or other arrangements). Even though CMS has not promulgated specific regulations in the Code of Federal Regulations (CFR) for liability settlements and has not yet issued specific guidelines for liability settlements, liability is one of the primary plans outlined in the MSP statute that are considered primary to Medicare (Liability Insurance Including Self-Insureds (with the sub-set Automobile specifically mentioned in the CFR, No Fault, and Workers’ Compensation). In the Hinsinger v. Showboat Atlantic City, 420 N.J. Super. 15, 18 A.3d 229 (2011) case, the Superior Court of New Jersey found. . .

“. . . no reason to apply a different standard to set asides created with money obtained from third-party liability claims than it applies to set asides created with money obtained from workers’ compensation claims. The statutory and policy reasons for creating both of them are the same: to protect the government, and the Medicare system in particular, from paying medical bills for which the beneficiary has already received money from another source.”

The court reasoned that in the absence of specific liability regulations concerning the MSP, it was appropriate to analyze the regulations geared toward WC. This would seem like a reasonable starting point for CMS as it relates to futures. Of course, liability cases have different types of damages that can be awarded, most notably non-economic damages that are not awardable in WC cases. Causation issues and percentages of liability can limit the recovery for plaintiffs in liability cases with specific percentages being parsed out/negotiated in states with pure comparative negligence. Lastly, plaintiffs in liability can often argue that they were not Made Whole when the injuries and damages are present but the at fault party’s funding is limited by low policy limits.

These factors have not yet been addressed in any regulations or current guidance by CMS. However, when a WC settlement may not be reviewed by CMS because it is outside CMS workload review thresholds, CMS takes the position that parties must still consider Medicare’s interests in the settlement. Currently, liability settlements are still not being reviewed by CMS even though CMS had included reviews of liability MSA’s in a prior Request for Proposal when searching for its last WCRC MSA review contractor. Therefore, it makes sense that for liability settlements, parties should still be considering Medicare’s interests and especially so, when the settlement involves a Medicare beneficiary or one with a reasonable expectation of becoming a beneficiary within 30 months of the settlement. The WCMSA Reference Guide could contain part of the puzzle in helping an injured party being compensated for future medicals in planning their future care.

As of May 25, 2022, CMS has neither issued regulations nor new guidelines with respect to protecting Medicare’s interests when liability settlements compensate for future medicals covered by Medicare. CMS needs to provide such a roadmap if it is serious about protecting the Medicare Trust Funds for future generations. Because the MSP law itself sets the standard for the protection of Medicare, and the law and its regulations enable Medicare’s ability to deny payments and/or make conditional payment recovery, does it really make sense to ignore planning the injury related future care of your client even when the regulatory agency has been slow to act?

Each attorney should provide their clients with enough information to help them assess their risks and to determine if denial of injury related future medicals or the potential for recovery of future conditional payments by Medicare is a risk they are willing to take. There are a wide range of products being offered to address MSP exposure and to protect Medicare’s interests in liability settlements based on the varying risk tolerance levels of your client. Count on Medivest to help you spot these intricacies so you can deliver prudent advice to your clients.

Medivest

06/Apr/2022

On Wednesday, April 13 at 1 pm EST, the Centers for Medicare & Medicaid Services (CMS) will host a webinar regarding the new “Go Paperless” option in the Medicare Secondary Payer Recovery Portal. The Go Paperless Quick Reference Guide can be downloaded here. The full notice can be read below:

The Centers for Medicare & Medicaid Services (CMS) will be hosting an overview of the new “Go Paperless” feature available in the Medicare Secondary Payer Recovery Portal (MSPRP). Insurers and authorized agents may now choose to opt-in to paperless functionality. Once registered, users will be able to quickly and easily access all recovery correspondence including demand letters, using the MSPRP. Opting to “Go Paperless” in combination with the ability to submit correspondence through the MSPRP and the multiple available options for electronic payment will allow your organization to not only reduce the amount of paper that needs to be physically handled, associated workload and environmental impacts, but also eliminate concerns about delays that can arise when information is sent through the mail.

The webinar will feature opening remarks and a presentation, followed by a question and answer session.

Date: Wednesday, April 13, 2022
Time: 1:00 PM ET

Webinar URL: https://www.mymeetings.com/nc/join.php?i=PWXW2662768&p=6930242&t=c

and

Conference Dial In: 800-779-1251
Conference Passcode: 6930242

Please note that for this webinar you will need to access the webinar link and dial in using the information above to access the visual and audio portion of the presentation. Due to the number of participants please dial in at least 15 minutes prior to the start of the presentation.

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

Medivest

24/Mar/2022

The Centers for Medicare & Medicaid Services (CMS) released a revised Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide (“Reference Guide”) Version 3.6 on March 15, 2022. This Reference Guide replaces Version 3.5 on January 10, 2022. There are a few notable changes when comparing the two Reference Guides. The blue highlights below indicate the updated changes provided in Reference Guide Version 3.6.

To download the new WCMSA Reference Guide v3.6 click here.

Version 3.6 of this guide includes the following changes:

Clarification has been provided regarding the use of non-CMS-approved products to address future medical care (Section 4.3), as well as documentation and re-review tips (Sections 9.4.1.1, 10.2, and 16.1).

4.3 The Use of Non-CMS-Approved Products to Address Future Medical Care – Additions and Replacements

A number of industry products exist for the purpose of complying with the Medicare Secondary Payer regulations without participation in the voluntary WCMSA review process set forth in this reference guide. Although not inclusive of all products covered under this section, these products are most commonly termed “evidence-based” or “non-submit.”

42 C.F.R. 411.46 specifically allows CMS to deny payment for treatment of work-related conditions if a settlement does not adequately protect the Medicare program’s interest. Unless a proposed amount is submitted, reviewed, and approved using the process described in this reference guide prior to settlement, CMS cannot be certain that the Medicare program’s interests are adequately protected. As such, CMS treats the use of non-CMS-approved products as a potential attempt to shift financial burden by improperly giving reasonable recognition to both medical expenses and income replacement.

As a matter of policy and practice, CMS may at its sole discretion deny payment for medical services related to the WC injuries or illness, requiring attestation of appropriate exhaustion equal to the total settlement as defined in Section 10.5.3 of this reference guide, less procurement costs and paid conditional payments, before CMS will resume primary payment obligation for settled injuries or illnesses, unless it is shown, at the time of exhaustion of the MSA funds, that both the initial funding of the MSA was sufficient, and utilization of MSA funds was appropriate. This will result in the claimant needing to demonstrate complete exhaustion of the net settlement amount, rather than a CMS-approved WCMSA amount.

Notes: This official policy shall apply to all notifications of settlement that include the use of a non-CMS-approved product received on, or after, January 11, 2022; however, flags in the Common Working File for notifications received prior to that date will be set to ensure Medicare does not make payment during the spend-down period.

CMS does not intend for this policy to affect any settlement that would not otherwise meet review thresholds. This comment does not relieve the settling parties of an obligation to consider Medicare’s interests as part of the settlement; however, CMS does not expect notification or submission where thresholds are not met.

9.4.1.1 Most Frequent Reasons for Development Requests – Expanded Explanations

The five most frequent reasons for development requests by the WCRC:

1. Insufficient or out-of-date medical records. Medical records are required documents for all submissions, including situations where the parties are in dispute.
2. Insufficient payment histories, usually because the records do not provide a breakdown for medical, indemnity or expenses categories. Payment histories are required documents for all submissions, including situations where the parties are in dispute, and must include breakdowns for payment categories along with identification of any category codes.
3. Failure to address draft or final settlement agreements and court rulings in the cover letter or elsewhere in the submission. Draft or final settlement agreements and court rulings are required documents for all submissions, if they exist. For settlements where conditional payments are made as an element of the agreement, the WCRC will not accept a letter indicating that draft or final settlements do not exist.
4. Documents that are referenced in the file are not provided—this usually occurs with court rulings or settlement documents.
5. References to state statutes or regulations without providing sufficient documentation (i.e., to which payments the statutes/regulations apply or a copy of the statute or regulation, or notice of which statutes or regulations apply to which payments).

10.2 Section 10 – Consent to Release Note – Additions

The Consent to Release note is the claimant’s signed authorization for CMS, its agents and/or contractors to discuss his or her case/medical condition with the parties identified on the authorization in regard to the WC settlement that includes a WCMSA. When you submit your WCMSA, you are required to include the signed consent, plus any applicable court papers if the consent is signed by someone other than the claimant (for example, a guardian, power of attorney, etc.). Do not include unsigned consents or consents to obtain medical records from a provider.

All consent-to-release notes must include language indicating that the beneficiary reviewed the submission package and understands the WCMSA intent, submission process, and associated administration. This section of the consent form must include at least the beneficiary’s initials to indicate their validation.

Consent to Release documents must be signed (by hand or electronically) with the full name of either the claimant, matching the claimant’s legal name, or by the claimant’s authorized representative, if documentation establishing the relationship is also provided. It must be a full signature, not just initials. For electronic standards, only the use of an E-SIGN Act-compliant e-signature or initials are considered valid.

If there is a change in submitter, please see Section 19.4 for more information.

16.1 Re-Review – Additions

A request for re-review may be submitted based one of the following:

1. Mathematical Error: Where the appropriately authorized submitter or claimant disagrees with CMS’ decision because CMS’ determination contains obvious mistakes (e.g., a mathematical error or failure to recognize medical records already submitted showing a surgery, priced by CMS, that has already occurred), or
2. Missing Documentation: Where the submitter or claimant disagrees with CMS’ decision because the submitter has additional evidence, not previously considered by CMS, which was dated prior to the submission date of the original proposal and which warrants a change in CMS’ determination.

- - Disagreement surrounding the inclusion or exclusion of specific treatments or medications does not meet the definition of a mathematical error.
  - Re-Review requests based upon failure to properly review already submitted records must include only the specific documentation referenced as a basis for the request.
  - Should no change be made upon response to a re-review request (i.e. no error was identified), additional requests to re-review the same error will not be entertained.”

Analysis

The removal of the reference to indemnification in the first part of Section 4.3 seems to have been CMS’s way of expressing its realization that the intent of settling parties in using non-submit WCMSAs is to protect Medicare’s interests as opposed to being designed merely to protect against MSP exposure via a shift of risk from one company’s errors and omissions coverage to another’s.

[Old Section 4.3 phrase]: “with the intent of indemnifying insurance carriers and CMS beneficiaries against future recovery for conditional payments made by CMS for settled injuries.” [New Section 4.3 phrase]: “for the purpose of complying with the Medicare Secondary Payer regulations without participation in the voluntary WCMSA review process set forth in this reference guide.”

Does the additional language about expectations for WC settlements that do not meet workload review threshold in Section 4.3 now really clarify what the plan for future care should be when the two examples in Section 8.1, titled Review Thresholds still describe recoveries by CMS for payments and care related to the injury up to the total value of the settlement if the settling parties fail to consider Medicare’s future interests/fail to establish “some plan for future care” ? The referenced examples are listed below for ease of access:

Example 1: A recent retiree aged 67 and eligible for Medicare benefits under Parts A, B, and D files a WC claim against their former employer for the back injury sustained shortly before retirement that requires future medical care. The claim is offered settlement for a total of $17,000.00. However, this retiree will require the use of an anti-inflammatory drug for the balance of their life. The settling parties must consider CMS’ future interests even though the case would not be eligible for review. Failure to do so could leave settling parties subject to future recoveries for payments related to the injury up to the total value of the settlement ($17,000.00).

Example 2: A 47 year old steelworker breaks their ankle in such a manner that leaves the individual permanently disabled. As a result, the worker should become eligible for Medicare benefits in the next 30 months based upon eligibility for Social Security Disability benefits. The steelworker is offered a total settlement of $225,000.00, inclusive of future care. Again, there is a likely need for no less than pain management for this future beneficiary. The case would be ineligible for review under the non-CMS-beneficiary standard requiring a case total settlement to be greater than $250,000.00 for review. Not establishing some plan for future care places settling parties at risk for recovery from care related to the WC injury up to the full value of the settlement.

Stay Up To Date

Count on Medivest to help you navigate your risk tolerance in light of the new CMS WCMSA Reference Guide language to see if we can’t find the right balance to reasonably protect Medicare’s interests in your settlement. Medivest will continue to monitor changes in the guidance and regulations published by CMS and will keep its readers up to date when such changes are announced/made. For questions regarding these updates, please reach out to a Medivest representative in your area by clicking here or by calling us direct at 877.725.2467.

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On Tuesday, June 6th, Centers for Medicare & Medicaid Services (CMS) will be hosting a webinar regarding the upcoming implementation of the Section 111 NGHP Unsolicited Response File option. The full notice can be read below:

Section 111 Non-Group Health Plan (NGHP) Unsolicited Response File Webinar Tuesday June 6, 2023

Mandatory Reporting for Liability Insurance (including Self-Insurance), No-Fault Insurance and Workers’ Compensation

A Brief Review of Gallardo v. Marstiller

CMS Letter – SMD # 23-002

Questions Regarding Lien Resolution?

The Proposed Rule

Section 111 Background

Summary

Extension Timeline for Publication of Final Rule

Stay Informed

On Tuesday, December 6, 2022, Centers for Medicare & Medicaid Services (CMS) will be hosting a webinar entitled, “Mandatory Reporting for Liability Insurance (including Self-Insurance), No-Fault Insurance and Workers’ Compensation”. The full notice can be read below:

Webinar Link: https://cms.zoomgov.com/j/1604816351?pwd=QmlUVUl1MkU4Y3htY1J0M0tUN3hoUT09

CMS’s Version 3.8 Reference Guide, Section 1.1 includes the following changes:

To download the new WCMSA Reference Guide v3.8 Click Here.

For your convenience, we have included the entirety of Section 16.1 and 16.2, so you will have the most up to date information regarding the process of re-review:

16.1 Re-Review

A request for re-review may be submitted based one of the following:

Missing Documentation: Where the submitter or claimant disagrees with CMS’ decision because the submitter has additional evidence, not previously considered by CMS, which was dated prior to the submission date of the original proposal and which warrants a change in CMS’ determination.

Disagreement surrounding the inclusion or exclusion of specific treatments or medications does not meet the definition of a mathematical error.

Re-Review requests based upon failure to properly review already submitted records must include only the specific documentation referenced as a basis for the request.

Should no change be made upon response to a re-review request (i.e., no error was identified), additional requests to re-review the same error will not be entertained.

Examples include, but may not be limited to; medical records with incorrect patient identifying information or rated ages where the rated-age assessor provided incorrect information in the rated-age document.

16.2 Re-Review Limitations

Note: The following re-review limitations are only available for approvals from September 1, 2022 forward.

Re-review shall be limited to no more than one request by type.

Disagreement surrounding the inclusion or exclusion of specific treatments or medications does not meet the definition of a mathematical error.

Re-Review requests based upon failure to properly review already submitted records must include only the specific documentation referenced as a basis for the request.

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.

TAKE AWAYS:

What is the Medicare Secondary Payer Statute?

What is a Medicare Set-Aside (MSA) Proposal?

Guidance from Medicare for Liability Cases

Litmus Test – Is a MSA Proposal Recommended?

In order to determine if a MSA allocation is recommended to cover Medicare’s interest in your settlement, there are several key items to review. Attorneys can do a quick MSA litmus test to determine whether or not a MSA is recommended.

Your client is currently Medicare-eligible

Your client is 62.5 years old and within 30 months of becoming eligible for Medicare benefits

Your client has either applied for Social Security Disability Insurance (SSDI) or has an open or pending application Will there be any money after medical liens have been resolved to fund a Medicare Set-Aside (MSA) account?

Medicare Eligibility

What is Medicare’s criteria for an individual to become Medicare eligible? Medicare is available for people aged 65 or older, younger people with disabilities, and people with End Stage Renal Disease (permanent kidney failure requiring dialysis or transplant).

Social Security Disability Insurance (SSDI)

An individual who has either applied or has reapplied for Social Security Disability Insurance can become Medicare eligible. Social Security Disability Insurance (SSDI) is a federal program that helps those who have become disabled from work. An individual can apply for SSDI when:

A person is unable to engage in any “substantial gainful activity” due to an illness or disability and;

When a person is not able to return to work for 12 months or more and;

When a person has accumulated enough work credits in the last 10 years to qualify.

30 Months to Become Medicare Eligible

The reason why it takes 30 months to become Medicare eligible after the individual has either applied or reapplied for SSDI is that:

The individual needs to wait one month after the date of injury to apply for SSDI.

After the SSDI applicate date, there is a waiting period of 5 months to receive SSDI entitlement.

From the date of SSDI entitlement, Medicare has 24 months waiting period to become Medicare eligible.

Medicare Set-Aside (MSA) – Not Required by Law

Best Practices

Our highly trained Medicare Expert Case Advisors can help you figure out if Medicare may have an interest in your settlement. We assist all settling parties to navigate the MSP complexities and provide you with cost-saving strategies for your settlement.

To receive our complimentary MSA Decision Tree, “When Is a MSA Allocation Recommended?” click here.

On Wednesday, April 13 at 1 pm EST, the Centers for Medicare & Medicaid Services (CMS) will host a webinar regarding the new “Go Paperless” option in the Medicare Secondary Payer Recovery Portal. The Go Paperless Quick Reference Guide can be downloaded here. The full notice can be read below:

The webinar will feature opening remarks and a presentation, followed by a question and answer session.

Date: Wednesday, April 13, 2022 Time: 1:00 PM ET

Webinar URL: https://www.mymeetings.com/nc/join.php?i=PWXW2662768&p=6930242&t=c

and

Conference Dial In: 800-779-1251 Conference Passcode: 6930242

Please note that for this webinar you will need to access the webinar link and dial in using the information above to access the visual and audio portion of the presentation. Due to the number of participants please dial in at least 15 minutes prior to the start of the presentation.

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

To download the new WCMSA Reference Guide v3.6 click here.

Version 3.6 of this guide includes the following changes:

Clarification has been provided regarding the use of non-CMS-approved products to address future medical care (Section 4.3), as well as documentation and re-review tips (Sections 9.4.1.1, 10.2, and 16.1).

4.3 The Use of Non-CMS-Approved Products to Address Future Medical Care – Additions and Replacements

9.4.1.1 Most Frequent Reasons for Development Requests – Expanded Explanations

The five most frequent reasons for development requests by the WCRC:

Insufficient or out-of-date medical records. Medical records are required documents for all submissions, including situations where the parties are in dispute.

Documents that are referenced in the file are not provided—this usually occurs with court rulings or settlement documents.

References to state statutes or regulations without providing sufficient documentation (i.e., to which payments the statutes/regulations apply or a copy of the statute or regulation, or notice of which statutes or regulations apply to which payments).

10.2 Section 10 – Consent to Release Note – Additions

If there is a change in submitter, please see Section 19.4 for more information.

16.1 Re-Review – Additions

A request for re-review may be submitted based one of the following:

Missing Documentation: Where the submitter or claimant disagrees with CMS’ decision because the submitter has additional evidence, not previously considered by CMS, which was dated prior to the submission date of the original proposal and which warrants a change in CMS’ determination.

Disagreement surrounding the inclusion or exclusion of specific treatments or medications does not meet the definition of a mathematical error.

Re-Review requests based upon failure to properly review already submitted records must include only the specific documentation referenced as a basis for the request.

Date: Wednesday, April 13, 2022
Time: 1:00 PM ET

Conference Dial In: 800-779-1251
Conference Passcode: 6930242

To download the new WCMSA Reference Guide v3.6 click here.