Is CMS approval of the MSA Allocation Necessary?

In specific situations, The Centers for Medicare and Medicaid Services (CMS) must approve a Medicare Set-Aside Allocation. This approval mainly consists of ratifying the amount specified to cover future Medicare-allowable expenses. Requirement for CMS approval is based upon two facts:  The Medicare status of the injured person at the time of settlement and the amount of the total settlement.

The first issue to consider is the Medicare status of the injured person at the time of settlement.  If a Medicare Set-Aside Allocation has been written, it means that the injured person is either currently entitled to Medicare benefits or entitled to such within 30 months (this is because at 62.5 years of age, an injured person is within 30 months of being eligible for Medicare). 

Next, consider the Total Settlement Amount. If the injured person is currently entitled to Medicare benefits and the total settlement amount (not just the medical portion) is greater than $25,000, CMS approval is required.  If the injured person will be entitled to Medicare benefits within 30 months and the total settlement amount (again, not just the medical portion) is greater than $250,000, CMS approval is required. 

For a clarification of the above, consult the following flow chart:

If you aren't sure whether or not an Medicare Set-Aside Allocation is necessary, review this article.