With Medicare still in financial short and long term trouble, the US Department of Health and Human Services (HHS), and its Center for Medicare and Medicaid Services (CMS), have become increasingly more aggressive about making sure Medicare is the secondary payer pre and post settlement in auto, liability, no-fault, and workers compensation claims. As a result, insurers, self insureds, and third party administrators responsible for payment of auto, liability, no-fault, and work comp claims must be aware of and understand their responsibilities under the Medicare Secondary Payer Act (MSP), and be prepared for the multiple risks associated with MSP compliance. What follows is part one of a four-part analysis of risks associated with each of the MSP compliance components: Mandatory Insurer Reporting (MIR), Conditional Payment Resolution (CPR), and Medicare Set Asides (MSA). This first of a four part series focuses on MIR compliance risks for auto, liability, no-fault, and work comp primary payers.
On September 20, 2017, the United States District Court for the Southern District of Florida published its opinion on MSPA Claim I, LLC., v. National Fire Insurance Company of Hartford, finding that since it is undisputed that on June 4, 2014, at the time of the settlement in this case, the threshold amount referenced in paragraph (9) of the Medicare Secondary Payer Act (MSP) was set at $2,000, and that National Fire's settlement was for $1,500, the threshold to bring an MSP private cause of action is not met. The Court therefore concludes that Plaintiff does not state a cognizable claim under the MSP. Having found the threshold amount is not met, the Court did not reach the standing issue as to whether the Plaintiff had a valid assignment at the time it filed suit.
Medicare Secondary Payer (MSP) compliance has become an integral part of claims handling for both the injured plaintiff and his/her counsel, as well as the corporate defendant, its insurer, and its counsel. Litigants today must pay close attention and stay informed about plaintiff’s entitlement to Medicare, and whether Medicare makes any conditional payments related to the pending or settled claim. In addition, litigants today must know whether the plaintiff is enrolled in a Medicare Advantage Plan (MAP) or Prescription Drug Plan (PDP), and whether such plans make any conditional payments related to the pending or settled claim. Not knowing this will create havoc on your claim, your settlement, your practice, and your business.
The Centers for Medicare & Medicaid Services (CMS) announced this week that the Social Security Number Removal Initiative (SSNRI) will now be known as “New Medicare cards.” Regardless of what the program is called, the bottom line is that the old Social Security Number based Health Insurance Claim Number (HICN) will be replaced by a new Medicare Beneficiary Identifier (MBI). This is not exactly new news as the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015 required CMS to remove Social Security Numbers from all Medicare cards by April 2019 and CMS announced the upcoming transition earlier year.
On March 23, 2017, the United States District Court for the Southern District of Florida published its opinion on Shapiro v. Secretary of Department of Health and Human Services, concluding that, even though Plaintiff and her attorney may have relied on Medicare’s verbal representation of $17,306.03 in conditional payments to settle the case, absent a waiver from CMS or its contractors in writing, the MSP Act requires Plaintiff to reimburse Medicare, and permits the Secretary of HHS to recover, the full $23,552.96 it paid in conditional payments from date of accident thru date of settlement. Since Plaintiff did not request a waiver for reimbursing all or part of the debt based on financial hardship, and failed to prove recovery is against equity and good conscience, court concludes plaintiff did not suffer a material detriment as she would still received 96% of settlement proceeds she agreed to.
On March 15, 2017, the United States District Court for the Southern District of Florida published its opinion on MSPA Claims I v. Century Surety Company, concluding that based on the USCA 11th Circuit opinions MSP Recovery, LLC v. Allstate Insurance Co., and Humana Medical Plan, Inc. v. Western Heritage Insurance Co., MSPA Claims I, an assignee of a Medicare Advantage Plan (MAP), has the right to recover medical expenses the MAP paid on behalf of one of its enrollees from Century Surety Company, the liability insurer that issued a commercial liability insurance policy with a Med-Pay clause. The court finds that MSPA Claims I has a private cause of action under the Medicare Secondary Payer Act (MSPA), as Century Surety is responsible for the payment of the medical expenses based on the existence of the Med-Pay policy and its denial in reimbursing same.
In 2017, new thresholds will be applied to the Section 111 reporting requirements for liability, no fault, and worker’s compensation claims. In a nutshell, here are the changes you need to be aware of:
Recently, we celebrated a year since the Centers for Medicare & Medicaid Services (CMS) transitioned a portion of the Non-Group Health Plan (NGHP) Medicare Secondary Payer (MSP) recovery workload from the Benefits Coordination & Recovery Center (BCRC) to its Commercial Repayment Center (CRC). On October 5, 2015, the CRC assumed responsibility for the recovery of conditional payments where CMS is pursuing recovery directly from a liability insurer (including a self-insured entity), no-fault insurer or workers’ compensation entity, referred to as Applicable Plans (AP), as the identified debtor. Since then, CMS has been pursuing recovery directly from APs as the identified debtor when an applicable plan reports that it has ongoing responsibility for medicals (ORM) or otherwise notifies CMS of its primary payment responsibility, as the assumption is that the AP’s responsibility is not in dispute.
Many companies write, evaluate, and offer services for Workers’ Compensation Medicare Set-Aside Arrangements (WCMSAs). Do these companies take into consideration your unique claim circumstances, your company’s risk tolerance and your overall claims management strategy?
Let’s start with a brief overview of the typical WCMSA process and the key details to consider as you choose a Medicare compliance partner.
In practice, Medicare compliance can be very complex. However, Flagship can mitigate your risk, ensure compliance and simply the process.
The first step to 100% compliance is accurate Section 111 Reporting. Every single time a new claim is initiated, the claims adjuster should ask:
- Is the claimant a Medicare beneficiary?
- Has claimant sustained an injury?
- Has or will money change hands?
If the answer to all these questions is “yes,” then you are legally required to report the claim to Medicare via Section 111.