FAQ

The rules for how Medicare Set Asides are administered are complex and can often be confusing. The following 'Frequently Asked Questions' are available to help you determine how these rules may apply to your case.

Workers’ Compensation

Q: When does a Medicare Set Aside need to be completed?

A: When the claimant is a Medicare beneficiary or is in the “waiting period” for Medicare benefits, defined by CMS/Medicare’s “Rules”

Q: What defines a person in the “Waiting period” defined by CMS/Medicare’s “Rules”?

A: When a claimant has a reasonable expectation of Medicare enrollment within 30 months if any of the following apply:

The claimant has applied for Social Security Disability Benefits

The claimant has been denied Social Security Disability Benefits but anticipates appealing that decision

The claimant is in the process of appealing and/or re-filling for Social Security Disability benefits

The claimant is 62 years and 6 months

The claimant has End-Stage Renal Disease (ERSD) condition but does not yet qualify for Medicare based upon ERSD

Q: Does the Medicare Set Aside need to be submitted to CMS/Medicare for written approval?

A: Based on CMS/Medicare’s user guide and “Rules” there are “safe harbor thresholds” and “working thresholds”. If the case meets the “working threshold” (the claimant is a Medicare beneficiary and the settlement agreement is greater than $25,000.00. Or the claimant is in the “Waiting period” for Medicare benefits and the settlement agreement is greater than $250,000.00). Then MSA Advocates strongly suggests getting written approval for the Medicare Set Aside when the case meets these criteria.

Q: Is there a process whereby the spend down of the Medicare Set Aside can be tracked and monitored by CMS/Medicare and the claimant?

A: Yes, CMS/Medicare now allows claimants to administer the spend down of their Medicare Set Aside online, making the process very easy. Call MSA Advocates, Inc. for information at 315-472-7965.

Medicare Set Asides for General Liability and Malpractice Claims

Q: Does a liability Medicare Set Aside need to be completed?

A: Yes, if the attorney/carrier plans to collect a settlement for injuries under a policy of liability, workers’ compensation, and/or no fault insurance and the claimant/plaintiff is a Medicare beneficiary OR is in the “waiting period” for Medicare benefits, as defined by CMS/Medicare’s “Rules” (See Question 2 above for “waiting period” definition), AND the claimant requires future medical treatment for monitoring for the claim injuries. If the claimant/plaintiff’s treatment physician will document in writing that no future medical treatment is required, a Medicare Set Aside MAY not be required, per CMS/Medicare’ Rules. Please call MSA Advocates, Inc. for more information BEFORE making this decision to protect all parties.

Q: Can you get a liability “approval” of the Medicare Set Aside from CMS/Medicare?

A: Although CMS/Medicare does not have strict rules/guidelines set for the liability process; they will still issue an acknowledgment/approval letter confirming their interest has been protected. MSA Advocates strongly suggests an acknowledgment letter is obtained from CMS/Medicare when the Medicare Set Aside is completed.

Q: What happens if I do not complete the Medicare Set Aside for Liability or the Workers’ Compensation claim?

A: If a Medicare Set Aside and written approval/acknowledgment is not completed to protect CMS/Medicare’s interest when it meets CMS/Medicare’s criteria outlined above and in the user guide; then CMS/Medicare has the right (under the Medicare Secondary Payers Act) to recover up to the claimant/plaintiff’s full settlement amount for reimbursement for any conditional payments that CMS/Medicare may make for the future medical treatment of the claim injuries. In addition, keep in mind that CMS/Medicare will deny payment for any future medical treatment for the claim injuries until such time as the claimant can prove that an “approved/acknowledged” Medicare Set Aside has been exhausted or the claim settlement proceeds have been exhausted by payment of medical treatment for the claim injuries.

Q: If there are an employer’s liability claim and a workers’ compensation claim for the same date of loss AND the injury sites are the same for both claims, do the settling parties need to do two Medicare Set Asides if the Medicare Secondary Payer (MSP) Compliance is used to protect Medicare’s interests?

A: No, two Medicare Set Asides are not required. Please call MSA Advocates, Inc. for assistance to be sure that this process is done correctly to protect all parties.

If you should have any questions with regard to the above questions/answers, please call our office and discuss with our knowledgeable staff at 315-472-7965.

Lien/Conditional Payment

Q: If my client is Medicare eligible and receives a settlement, are they required to reimburse Medicare for any conditional payments made by Medicare for treatment of the injuries related to the date of loss?  

A: Yes.  Under the Medicare Secondary Payer (MSP) Statute, which can be found at 42 U.S.C. §1395y (b), Medicare does not pay for any services for which payment has been made or can reasonably be expected to be made promptly "under a workmen’s compensation law or plan of the United States or a State or under an automobile or liability insurance policy or plan (including a self-insured plan) or under no-fault insurance." 42 U.S.C. §1395y (b)(2)(A)(i)(ii). Therefore, these insurance policies or plans are the "primary plan" and Medicare is considered the "secondary plan" for the payment of related medical expenses and entitled to reimbursement. Therefore, if the claimant/beneficiary will collect a “settlement” under one or more of these insurance plans, CMS/Medicare may assert their rights to collect conditional payments made.  In addition, an insurance claim may have more than one conditional payment/lien demanded by CMS/Medicare for the same date of loss that can expose all parties to the claim for reimbursement.  Please call MSA Advocates, Inc. for more information. 

Q: Can CMS/Medicare open multiple liens for a specific date of the incident?

A: Yes. Medicare establishes liens based on the various policies of insurance related to a specific incident and the carriers’ Section 111 reporting that is mandatory under the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA).  Therefore, parties may have more exposure to CMS/Medicare than one lien/conditional payment demand.  This could leave parties exposed for unpaid liens to CMS/Medicare during or after settlement.  Please call MSA Advocates, Inc. for more information.

Q: If there are multiple policies of insurance responding to the same date of loss can Medicare roll conditional payments between the policies of insurance?

A: Yes, and parties should be aware that this is commonplace when there are multiple liens set up by CMS/Medicare by virtue of the carrier’s Section 111 reporting requirements.  Please call MSA Advocates, Inc. for more information.

Q: If there are multiple defendants in a case and the case settles with one but not all of the defendants, must settlement be reported (either by the claimant, the claimant’s attorney, or the carrier) at that time, or should I wait until the case is settled with all defendants?

A: Yes. The settlement should be reported as soon as possible to Medicare so that any reimbursement that is owed can be made.  Call MSA Advocates Inc. for assistance.

Q: Are there any options available for reimbursement to Medicare if the settlement that the claimant/beneficiary will receive is minimal?

A: Yes. Medicare offers several options to mitigate the lien in these circumstances.  Please call MSA Advocates, Inc. to discuss these options further at 315-472-7965.