Understanding Medicare Set-Aside
Providing Medicare Compliance Solutions since 2010
The passage of the 2007 Medicare Medicaid SCHIP Extension Act (MMSEA) changed the way the insurance and legal communities settle claims that may include the need for future medical treatment. Section 111 of the MMSEA set forth a method that allows Medicare to track and enforce its basic rights of recovery as a secondary payer.
Since the MMSEA was passed, workers’ compensation, general liability, auto liability, and other injury claim settlements have been burdened by confusion and misinformation about the responsibilities of parties entering into a settlement.
MSA Administrators has the expertise to lead your case towards settlement while complying with CMS and their regulations.
Resources
Check out these links from CMS.gov to better understand some of the basic principles of Medicare compliance.
- Section 111: The passage of the 2007 Medicare Medicaid SCHIP Extension Act (MMSEA)
changed the way the insurance and legal communities settle claims for Medicare eligible individuals. Section 111 of the MMSEA set forth a method that allows Medicare to track and enforce its basic rights of recovery as a secondary payer. Click here for CMS’s summary of Section 111. - WCMSA Guide Narrative: CMS Routinely updates the official WCMSA Guidelines. Click here for a link to the most updated document, directly from CMS.
Memos
While CMS has been very slow to provide actual rules and regulations regarding the settlement process, they have issued a number of memos which provide insight into complying with the law in the settlement process. Click below to see the memos with our brief explanation.
- May 11, 2011 – WCMSA Workload Review Thresholds
- June 8, 2010 – Memorandum Clarifying the May 14, 2010 Rated Age Language
- April 3, 2009 – Procedures Regarding Methodology for Pricing Future Prescription Drug Treatment
- August 25, 2008 – Pricing of Implantable Devices
- May 20, 2008 – Use of CDC Table 1 in the WCMSA Review Process
- July 24, 2006 – WCMSA Part D FAQs
- April 25, 2006 – WCMSA Low Dollar Threshold
- December 30, 2005 – WCMSA and Part D
- July 11, 2005 – WCMSA FAQs
- July 5, 2005 – Summary High Level Memorandum Info
- October 15, 2004 – WCMSA FAQs
- May 7, 2004 – WCMSA Policy
- May 23, 2003 – WCMSA FAQs
- April 21, 2003 – Workers’ Compensation FAQs
- July 23, 2001 – Commutation of Future Benefits
- June 1, 2009 – CMS Prescription Drug Set-Aside Guidance
FAQ
An MSA, or Medicare Set-Aside Arrangement, is a document that is used to allocate funds from a settlement, to be “set aside” for future medical treatment related to the injury.
No. While many in the industry share this belief, it is absolutely false. The duty to protect Medicare from future payment for treatment related to a settlement extends to every form of non-group healthcare plans. This includes workers’ compensation, general liability, auto liability, medical malpractice, no-fault, PIP, etc. See the Sally Stalcup Memo, wherein she explains that Medicare does not distinguish between any form of insurance.
Never! While CMS recommends using MSAs as part of a settlement, and has stated that MSAs are the best tool for protecting Medicare’s interests, there is no law requiring an MSA on any case, of any dollar amount. This doesn’t mean, however, that they aren’t a very useful tool. We recommend using an MSA, or a similar device, to protect Medicare’s interests any time a claimant may need future medical care related to the claimed injury. MSAs offer the best protection for both parties in the settlement, as they show a reasonable attempt to protect CMS from making future payment.
The best way to determine this is to review the facts of of the case with one of our experts. Click here to be connected to MSA administrators now.
There is a lot of confusion about dollar amounts and protecting Medicare. CMS established a review process for workers’ compensation claims only. There are thresholds for this review process ($25,000 if Medicare eligible and $250,000 if
Wrong. Simply authoring an MSA does not protect CMS from making future payments. The administration of that set-aside is ultimately the most important factor in protecting you and your client from Medicare. Click here for more info on Professional Administration.