Tag Archive for: CMS

CMS Provides Notice Regarding LMSA Regulations/Guidance

CMS Provides Notice Regarding LMSA Regulations/Guidance

Click here for a downloadable copy of this blog

Once again, the Centers for Medicare & Medicaid Services has provided an indication that while regulations and/or guidance is on its way regarding the protection of Medicare’s future interests for liability and No Fault settlements, the proposed rule regarding these have been moved to August 1, 2020 or perhaps further into the future (again). Technically, the information indicates that the Notice of Proposed Rule Making would “clarify existing Medicare Secondary Payer (MSP) obligations associated with future medical items services related to liability insurance (including self-insurance), no fault insurance, and worker’s compensation settlements, judgments, awards, or other payments. Specifically, this rule would clarify that an individual or Medicare beneficiary must satisfy Medicare’s interest with respect to future medical items and services related to such settlements, judgments, awards, or other payments. This proposed rule would also remove obsolete regulations.” The information is also indicating that regulations CMS determines to be obsolete will be removed. See the disclosure published in the Spring 2020 Federal Register Unified Agenda here.

Many in the MSP compliance industry believe that while the regulations and guidance could be focused on clarifying both the need to protect Medicare’s future interests and the way to protect those interests for each of the Non Group Health Plan (NGHP) primary plan types (Liability, Self-Insurance, No Fault, and Workers’ Compensation), it seems more likely that this particular group of regulations and/or guidance will focus primarily on liability and No Fault settlements. This is because both regulations and guidance have already been published specific to protecting Medicare’s future interests in Workers’ Compensation settlements in both the Code of Federal Regulations and via the Workers’ Compensation Medicare Set-Aside Arrangement – WCMSA Reference Guide Version 3.1.

Regulations regarding this issue would be promulgated by CMS to appear in 42 CFR 405 and/or  42 CFR 411 and would apply to the Medicare Secondary Payer Act (MSP) found at 42 U.S.C. 1395y(b).  The removal of obsolete regulations could apply to any of the NGHP types.  The MSP, as governing federal law, applies to all of the NGHP types listed above, prohibits Medicare from paying when a primary plan’s funds are used to compensate an injured individual as a result of an injury, and provides extraordinary remedies to allow Medicare to recover payments it has made (called conditional payments) when it pays for an injured party’s medicals without regard to the dates of service for those payments.

Take Aways
  • Considering and protecting Medicare’s past interests has become the industry standard and quite honestly a “no brainer” for all NGHP settlement types – liability, self-insurance, No Fault, and Workers’ Compensation.
  • Whether the announced guidance comes this August or not, doesn’t it make sense to help ensure that Medicare’s future interests are protected in accordance with existing federal law, i.e. the MSP?
  • Helping to ensure that Medicare is not prematurely billed for injury related futures for any settlement type is the right thing to do and helps protect the Medicare Trust Funds.

Count on Medivest to help guide you through some of the complexities associated with MSP compliance.



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Updates on CMS’ Self-Administration Toolkit for Workers’ Compensation Medicare Set-Aside Arrangements

Updates on CMS’ Self-Administration Toolkit for Workers’ Compensation Medicare Set-Aside Arrangements

The Centers for Medicare & Medicaid Services released Version 1.3 of the Self-Administration Toolkit for Workers’ Compensation Medicare Set-Aside Arrangements (WCMSAs) on October 10, 2019. The latest Self-Administration Toolkit Version 1.3 is now available to download here. Furthermore, the newest version 5.9 of the WCMSAP User Guide was updated on October 7, 2019. That can be accessed here. It contains updates similar to those found in the updates to the Self-Administration Toolkit discussed in this article.

The three most notable changes included in Version 1.3 are as follows:

1.  A new method for submitting annual attestations electronically via the WCMSA portal (WCMSAP).

Section 8: Annual Attestation – of the Self-Administration Toolkit conformed its language to that of the WCMSA Reference Guide, Section 19.2 titled Death of The Claimant, and can be viewed here. Now, self-administering claimants can access and submit attestations via the same WCMSAP web portal that professional administrators use.

If you are a beneficiary administering your own account, you can submit your year attestation online by accessing the WCMSA Portal through the website.

If you are a representative or other identified administrator for the account, you can log in directly to the WCMSA Portal to submit the yearly attestation. To access, go to

The WCMSAP User Guide, available under the Reference Materials header once you log in to the site, has details regarding the submission of attestations online.

CMS will be hosting two (2) webinars regarding the recent WCMSAP enhancements which will allow Medicare beneficiaries or their representatives to submit annual attestations electronically for approved WCMSAs.

  1. Workers’ Compensation Medicare Set-Aside (WCMSA) Electronic Attestation Enhancement Webinar. Click here for more information regarding this seminar taking place on Wednesday, October 30, 2017 at 1:00pm EST.
  2. Workers’ Compensation Medicare Set-Aside (WCMSA) Electronic Attestation Enhancement for Professional Administrators. Click here for more information regarding this seminar
    taking place on Wednesday, November 6, 2019 at 1:00pm EST.


2.  A more detailed description of why WCMSA accounts are kept open for a period of time after the death of the Medicare beneficiary when WCMSA funds have not permanently exhausted.

Section 10: Inheritance – Added language regarding notifying the BCRC when death of the Medicare beneficiary occurs before the WCMSA is permanently exhausted. A summary follows: In such cases, the respective Medicare Regional Office (RO) and the BCRC will coordinate to help ensure all timely filed bills related to the WC claim have been paid. This may involve keeping the WCMSA account open for some time after the date of death, as health care providers can submit their bills to Medicare up to 12 months after the date of service. Any remaining WCMSA funds may be paid in accordance with the respective state law and administration agreement if applicable, once Medicare’s interests have been protected. Often the settlement itself will state how to spend funds after the death of the claimant and payment of care-related expenses.


3.  Updated mailing addresses for the Benefits Coordination and Recovery Center (BCRC)

Section 12: Where to Get Help – The mailing address to where WCMSA Proposals, Final Settlements, and Re-Review Requests are to be sent was updated to be consistent with the current WCMSA Reference Guide. That address is:

WCMSA Proposal/Final Settlement
P.O. Box 13889
Oklahoma City, OK 73113-8899

On Page 18 of the Self-Administration Toolkit

The mailing address for situations when the WCMSAP or portals are not being used, self-administering claimants may submit attestations yearly account attestations and expenditure letters to the following address:

P.O. Box 138832
Oklahoma City, OK 73113


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.

Liability Medicare Set-Asides (LMSAs) – A Glimpse into the Future

Liability Medicare Set-Asides (LMSAs) – A Glimpse into the Future

Last week, the National Alliance of Medicare Set-Aside Professionals (NAMSAP) released a bulletin by Tom Stanley, co-chair of NAMSAP’s Liability MSP Advisory Committee, describing what he learned in a private meeting with the Centers for Medicare & Medicaid Services (CMS) in April 2018. In the meeting, which focused solely on liability Medicare Set-Asides (LMSAs), CMS representatives indicated that there will be an 18-month timeframe before rolling out a LMSA review program. Also, similar to the choice of whether to submit a Workers’ Compensation Medicare Set-Aside allocation report (WCMSA) for review by CMS for Workers’ Compensation claim resolutions that meet CMS established monetary and Medicare eligibility thresholds[1], the choice of whether to submit a LMSA to CMS for review under the new program would also be voluntary.

Other points brought up by CMS for LMSAs are paraphrased below:

• Denial of services for the affected body parts/injury is considered a “primary enforcement mechanism.”
• The injured party must receive something free and clear through judgment, settlement, award, or other payment (“Settlement”).
• Review of a LMSA would not occur until a Settlement has been reached.
• That a LMSA (and presumably the administration of the money set aside) is exclusively the responsibility of the plaintiff and that defendants, and their insurers, are not a “target” of CMS with respect to LMSAs.
• CMS would publish a LMSA Reference Guide.
• Individuals meeting the “eligibility” threshold for LMSAs would remain the same as the current WCMSA system – those Medicare beneficiaries or injured parties who have a reasonable expectation of Medicare enrollment within 30 months.
• There is no projected change in the law and pursuant to the Medicare Secondary Payer statute (MSP)[2], Medicare’s interest must be considered in every claim.
• A workload threshold of above $250,000 is anticipated – “NO SAFE HARBOR”. This level is analogous to the above $25,000 workload threshold for WCMSAs.
• For Settlements above $250,000 and up to $750,000, CMS review/approval would be available and encouraged by CMS. CMS would apply “a formula” to determine the LMSA amount. Starting with the total Settlement amount, CMS would subtract certain expenses and apply a discount factor to the total Settlement.
• Settlements above $750,000 would be presumed to fund all future medicals (considered full commutations) and for those cases, CMS would recommend the preparation of traditional LMSAs.

We have explained in the past that the creation of a Medicare Set-Aside (MSA) is not required by law for any type of case. However, in the Stalcup Memo[3], CMS provided its interpretation of the MSP by saying “[t]he law requires that the Medicare Trust Funds be protected from payment for future services whether it is a Workers’ Compensation or liability case. There is no distinction in the law.” Furthermore, while clarifying that a MSA allocation report is not mandated by CMS, the Stalcup memo announced that “[s]et aside is our method of choice and the agency feels it provides the best protection for the program and the Medicare beneficiary. The long-awaited LMSA review process may have been delayed (prior hints from CMS were that LMSA reviews might start as early as July 2018) due to a realization by CMS that reviewing LMSAs will be a huge undertaking with many factors to consider.

Take Aways from Meeting on LMSAs:

• When the injured party receives something (free and clear) through Settlement etc., that payment triggers the need to evaluate and protect Medicare’s interests.

• If you don’t consider and protect Medicare’s future interests at the time of Settlement and take steps to not prematurely bill Medicare, Medicare can deny payment for those body parts claimed and/or released by Settlement.

• Plaintiff counsel should take steps to educate themselves and their clients on all aspects of MSP compliance and formulate strategies to reasonably consider Medicare’s interests when Settlements fund future medicals and injured clients fall within the Medicare eligibility “window”.

• CMS should seek help from stakeholders in the MSP compliance community, the judiciary, and financial analysts to examine historical data to consider developing more than one formula to be able to reasonably address varying liability case types and differing legal and factual scenarios.

• The percentage of the net Settlement proceeds a beneficiary will receive as a ratio to the full value of the case after deducting procurement costs, attorney’s fees, and Medicare liens etc. can vary greatly and should be taken into consideration.

• There are many reasons liability cases may settle for less than full value including questions of causation, policy limits in place, and percentages of fault that can vary by state, under theories of applicable comparative negligence, contributory negligence or some hybrid thereof.

• The idea that CMS may now consider evaluating apportioned LMSA allocations and taking some of the factors leading to reduced Settlement values into consideration when reviewing LMSAs seems to be a step in the right direction.

[1] The current WCMSA threshold is for Workers’ Compensation claims with a judgment, settlement, award, or other payment (“Settlement”) above $25,000 for current Medicare beneficiaries and above $250,000 and for those with a reasonable expectation of becoming enrolled in Medicare within 30 months of the Settlement.

[2] 42 U.S.C. §1395y(b)(2) et seq.

[3] Sally Stalcup, MSP Regional Coordinator, Region VI (May 25, 2011 Handout).

Opioid Addiction Reduction is Goal of New CMS Rule

Opioid Addiction Reduction is Goal of New CMS Rule

On Monday, April 16, 2018, The Centers for Medicare & Medicaid Services (CMS) promulgated a rule[1], making both policy and technical changes to several programs including Medicare Advantage, Medicare Prescription Drug Benefit, Medicare-Fee-for-Service, Medicare Cost Plan and the PACE Programs. For the Medicare Secondary Payer (MSP) industry, the most pertinent part of this rule is that it will revise regulations for Medicare Advantage (Part C) and Prescription Drug Benefit (Part D) programs to allow implementation of provisions of the Comprehensive Addiction and Recovery Act (CARA), with a goal to reduce opioid misuse, addiction and/or overdose by Medicare beneficiaries, while still providing access to important pain management and treatment options. We recently wrote how CMS’ Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide review policies failed to provide a clear roadmap for reducing quantities (tapering) of prescription opioids over time to reduce the likelihood of opioid addiction.  While it is the medical providers that are on the frontline battling the addiction issue, regulatory amendments from CMS that encourage tapering and support evidence-based alternatives such as FDA approved medication assisted therapy (MAT), sound like steps in the right direction.

We agree with the National Alliance of Medicare Set-Aside Professionals’ (NAMSAP) position that CMS’s past policies haven’t done enough to address the opioid crisis. We applaud NAMSAP’s continuing efforts to bring this important issue to the attention of CMS and Congress. These efforts may have helped spur CMS to introduce the new rule[2] and the rule’s introduction seems to signal that CMS takes the opioid crisis seriously and desires to help curb opioid addiction.  We thank CMS for taking this step.  The rule will take effect on June 15, 2018, and Medivest will continue to monitor its implementation along with any legislative, regulatory or policy changes affecting the MSP industry.

[1] Medicare Program; Contract Year 2019 Policy and Technical Changes to the Medicare Advantage, Medicare Cost Plan, Medicare Fee-for-Service, the Medicare Prescription Drug Benefit Programs, and the PACE Program, 83 FR 16440-01, 2018 WL 1783794 (F.R.).

[2] Other goals of the rule listed in its summary are to allow implementation of

. . . provisions of the 21st Century Cures Act, support innovative approaches to improve program quality, accessibility, and affordability; offer beneficiaries more choices and better care; improve the CMS customer experience and maintain high beneficiary satisfaction; address program integrity policies related to payments based on prescriber, provider and supplier status in MA, Medicare cost plan, Medicare Part D and the PACE programs; provide an update to the official Medicare Part D electronic prescribing standards; and clarify program requirements and certain technical changes regarding treatment of Medicare Part A and Part B appeal rights related to premiums adjustments.

Medicare Conditional Payment Recovery Report FY 2017 by CMS for MSP CRC Contract

Medicare Conditional Payment Recovery Report FY 2017 by CMS for MSP CRC Contract

In its recent annual report to Congress, the Centers for Medicare & Medicaid Services (CMS) stated that during fiscal year (FY) 2017 ending September 30, 2017, its Medicare Secondary Payer Commercial Repayment Center contractor (CRC), obtained $131.78 million in net recoveries for conditional and mistaken payments made by Medicare that should have been paid by primary payers such as Group Health Plans (GHPs), or liability insurers (including self-insureds), no-fault insurers or workers’ compensation entities/plans (the latter group collectively called Non-Group Health Plans or NGHPs, and all recoveries described above will be referred to as Medicare conditional payment recoveries).

Like last year, the NGHP – Medicare conditional payment recoveries represented a larger percentage of the CRC’s overall conditional payment recoveries, and the report indicated that continued reduction of GHP recoveries was again due to the “maturity of the mandatory reporting instituted under Section 111 [of the Medicare Secondary Payer statute’s[1]] Medicare, Medicaid, and SCHIP Extension Act of 2007″ [2] (Section 111 Reporting), as well as the CRC’s “resolution of pending available recoveries.”

The $131.78 million net was larger than both FY 2016’s net of $88.35 million and FY 2015’s net of $125.05 million.  Because the newest CRC contractor, Performant Recovery, Inc. (Performant), just took over the CRC recovery contract on February 12, 2018, these reported recoveries reflect efforts of the former CRC contractor.  Performant has promised more efficiency in its collection process and better coordination with the Benefits Coordination & Recovery Contractor (BCRC), the entity that receives both notifications of NGHP settlements, judgments, awards or other payments (settlements) from beneficiaries and their representatives, as well as Section 111 Mandatory Insurance Reporting information about injuries, settlements and responsibility for payments from Responsible Reporting Entity (RRE) insurance carriers.  One indication that CMS and/or Performant may be keeping a closer eye on conditional payment recoveries and working more efficiently is that the FY2017 payment recovery report was available on the CMS website in the first quarter this year as opposed to the third quarter a year ago.

CMS’s continued expansion of Medicare conditional payment recoveries into NGHP categories with Performant in the CRC driver’s seat should mean even higher Medicare conditional payment recoveries moving forward.

[1] 42 U.S.C. §1395y(b).

[2] 42 U.S.C. §1395y(b)(8) et seq. (P.L. 110-173).

CMS Updates Language Affecting WCMSA Beneficiaries with Medicare Entitlement/Enrollment Changes

CMS Updates Language Affecting WCMSA Beneficiaries with Medicare Entitlement/Enrollment Changes

New language has been added to the Workers’ Compensation Medicare Set-Aside (WCMSA) Reference Guide that updates CMS’ explanation of how changes in Medicare entitlement and/or enrollment impacts (or rather, doesn’t impact) WCMSA administration. The July 10, 2017 update to Section 17.4 of the WCMSA Reference Guide (version 2.6) seems to require WCMSA beneficiaries to provide additional proof of proper WCMSA administration any time their Medicare entitlement or enrollment status changes. This may simply be a clarification of an existing standard rather than the addition of a new one. We’ll explore both possibilities, but first, let’s provide some context to explain.

Not all WCMSA beneficiaries are enrolled in the Medicare program. Sometimes, a Medicare Set-Aside account is established before the beneficiary has reached entitlement status. Or, if the WCMSA beneficiary doesn’t think the cost of the premiums are worth the coverage or has other coverage already, they may opt out of Medicare for a time. In such situations, a WCMSA beneficiary may attempt to apply the following logic: “I am not on Medicare, therefore there is no risk of a burden shift to Medicare for my workers’ compensation injury. Therefore, I do not need to administer my WCMSA according to CMS’ guidelines.” CMS counters that logic with some logic of their own: WCMSA beneficiaries who decide to not administer their accounts according to CMS guidelines because they’re not Medicare enrollees may eventually become Medicare enrollees with no WCMSA funds left to prevent a burden shift to Medicare. So, CMS requires that Medicare beneficiary or not, a WCMSA beneficiary must administer the WCMSA properly. In the event that the WCMSA exhausts of funds, Medicare will only cover injury related expenses if the WCMSA funds have been spent down appropriately.

This is where the update to the WCMSA Reference Guide comes into play. CMS added a clause to a key sentence in Section 17.4 – Medicare Entitlement and WCMSAs. The new language is underlined below:

The CMS will not pay for any expenses related to the WC claim or settlement until a self-attestation document with full accounting of all monies expended from the WCMSA is sent to the BCRC upon Medicare entitlement or re-establishment of Medicare entitlement.

There are at least two possible reasons this clause was added by CMS to this section. The first possibility is that because CMS does not monitor WCMSAs until the beneficiary is entitled to Medicare (See WCMSA Reference Guide v2.6, Section 18), CMS needs verification of proper administration when a WCMSA beneficiary becomes entitled to Medicare. Therefore, a simple self-attestation letter won’t do. CMS wants a “full accounting” of expenditures as soon as entitlement is gained or re-established.

The second possibility is that this is a clarification of an already existing CMS requirement that is applicable during periods of temporary or permanent exhaustion. Annual attestation is a requirement for anyone administering a WCMSA. CMS even provides a copy of the self-attestation letter with its WCMSA approval letter. As long as the WCMSA is being used to pay for injury-related expenses that would otherwise be covered by Medicare, and is solvent, a self-attestation letter is sufficient. However, when a WCMSA exhausts, CMS will pay for injury-related expenses, provided they can verify that the WCMSA has been appropriately spent down. This is where the “full accounting” comes into play. So, this is not exclusive to situations where Medicare entitlement changes. It is CMS’ standard process when assuming responsibility for injury related expenses during times of WCMSA exhaustion. Therefore, it is possible that CMS is not adding a “full accounting” requirement for WCMSA beneficiaries that wasn’t there before, but is rather correcting the former language that seemed to infer that a self-attestation letter was sufficient for CMS to assume responsibility for the injury after or during exhaustion.

So, what does this mean for anyone administering a WCMSA?  In either case, it is critical that an administrator keep very good records of how they’ve spent down a WCMSA, because a) CMS reserves the right to audit the account at any time, and b) should the WCMSA ever exhaust, CMS will require the administrator to demonstrate they’ve spent the WCMSA funds down properly before Medicare will pick up the tab.

As the nation’s first professional administrator, Medivest has dealt with this situation numerous times. Whenever we notify CMS of the exhaustion of a WCMSA (usually only temporarily when the WCMSA is structured with an annuity), we provide a full ledger that details every expenditure.  In the many years Medivest has been submitting an accounting of WCMSAs we administer, CMS has never refused to assume responsibility for injury-related expenses it would otherwise normally pay. This is likely why CMS has recently described professional administration of WCMSAs as “highly recommended.”


CMS’ Latest WCMSA Reference Guide: Professional Administration “Highly Recommended.”

The Centers for Medicare & Medicaid Services (CMS) just signaled their support for the professional administration of Medicare Set-Aside (MSA) funds. The July 10, 2017 release of the Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide Version 2.6 appends Section 17.1, the section covering MSA administrators, with a single sentence:

Although beneficiaries may act as their own administrators, it is highly recommended that settlement recipients consider the use of a professional administrator for their funds.

This addition is strong advice for anyone who is the beneficiary of settlement funds intended to pay for future Medicare-allowable expenses related to their injury or illness.

So, why is CMS calling professional administration “highly recommended”? One reason at least (and perhaps the most important) is that it’s in the beneficiary’s best interest. A self-administering beneficiary whose MSA has exhausted must be able to demonstrate to CMS that those funds were spent down in an appropriate way before Medicare will assume any responsibility for medical expenses. CMS seems to understand that for almost all MSA beneficiaries, the responsibility to properly administer an MSA is not a do-it-yourself task.

Consider what’s involved to make sure MSA funds are appropriately spent down.  The beneficiary must first negotiate an arrangement with their medical provider to not only accept cash payment for services, but also accept a repricing of those services by the patient themselves, an almost impossible task.

If this hurdle can be jumped, the beneficiary must then identify what services they received were Medicare-allowable and which were not. This requires an itemized bill with detail sufficient to evaluate the charges against allowable rates of compensation. Having parsed the services into Medicare-allowable and non-allowable, they must apply applicable fee schedules (fee schedules they must pay for or otherwise find access to) in order to reprice each service to an allowable rate. If this results in a reduction of the claim, they must then provide a justification for this reduction. The medical provider must then accept this as payment in full.

The beneficiary must then pay for these services from two separate accounts: Medicare-allowable expenses from the MSA account, and non-allowable expenses from other funds.  A proper accounting must be kept to sufficiently demonstrate the job has been done right.

Unfortunately, it’s no insignificant thing that hinges on this process being successfully followed. A beneficiary with an exhausted MSA can find themselves without a healthcare benefit to cover their ongoing injury-related care.

CMS understands that the situation is drastically different for a beneficiary who’s hired a professional administrator to handle their MSA funds. Communication with the medical provider about covered services, billing, re-pricing, and coordination of benefits are handled by the professional administrator.  The beneficiary simply seeks treatment. Furthermore, the professional administrator keeps an accurate and comprehensive accounting of all expenditures, and is able to effectively communicate with CMS during period of exhaustion, ensuring that CMS accepts responsibility for injury-related expenses.

CMS likely recognizes the exposure a poorly administered MSA can create for a beneficiary, and is thus advising them that when it comes to MSA administration, its recommended to leave it to the professionals.


CMS Extends WCRC Bid Solicitation Timetable to Include Additional MSA Reviews

The Centers for Medicare and Medicaid Services (CMS) has extended its original competitive bidding timetable for the Workers’ Compensation Review Contractor (WCRC) contract by a few months. This is a very important contract because the WCRC is the contractor responsible for reviewing all of Workers’ Compensation Medicare Set-Asides (WCMSAs).

The new WCRC contract bid dates are now extended, as follows:

  • Release of the bid solicitation – formerly 3.8.16, extended to 6.27.16
  • Proposal due date – formerly 4.8.16, extended to 7.27.16
  • Contract award date – formerly 6.20.16, extended to 11.7.16

Curiously, CMS stated that the reason for the extension is due to updates that are currently being made to the Statement of Work (SOW) to include the processing of other Non-Group Health Plan (NGHP) Medicare Set-aside Arrangements”. Does this mean that CMS is changing the WCMSA review thresholds, as we have heard? Or could it mean that CMS is formalizing the review of Liability Medicare Set-Asides (LMSAs), as they started to do in July 2012? We don’t know, but we will soon find out.

The other, non-timetable oriented, provisions of the WCRC contract solicitation remain unchanged, such as it being:

  • A Firm Fixed Price contract
  • For a twelve month base period with four, one-year renewal options
  • Set aside for a Section 8(A) minority-owned small business.

We will watch this issue closely and let you know as soon as something develops.

To view our previous blog about the original pre-solicitation notice, click here.

To review the original and the updated WCRC contract pre-solicitation notices, click here.


CMS to Solicit Competitive Bids for Medicare Set-Aside Review Work

The Centers for Medicare and Medicaid Services has announced that it intends to release a solicitation for competitive bids for the Workers’ Compensation Review Contractor (WCRC) on or about March 8, 2016, with an award date of June 20, 2016. It will be a Firm Fixed Price contract with a 12-month base period plus four one-year renewal options. The contract will only be available to Section 8(A) minority owned, small businesses.

The current WCRC contractor, Provider Resources, Inc (PRI), reviews about 29,000 Medicare Set-Asides (MSAs) per year under what appears to be a $5,124,084 per year contract, for an astonishing modest revenue amount of $180.00 per MSA review. They began on July 1, 2011 when the MSA settlement industry was grinding to a crawl with 7-month turn around times. Kudos to Shawn Keogh-Harz, President and CEO of PRI, for successfully reducing turnaround times to 2-4 weeks, while also increasing customer service and improving first-pass approvals. CMS also deserves praise. They did a great job in selecting PRI and working closely with them to improve performance. While we hope that PRI will continue, we are optimistic that whoever the next contractor is will resume the good outcomes of the past few years.

Although the current WCRC contractor has done a great job, we believe that there is a better way to achieve the goals of MSA compliance (which again is to save Medicare money), than focusing so many resources on reviewing WCMSAs. We will address that in our next blog post.

To view the 2.22.2016 CMS WCRC pre-solicitation notice click here.

To view our 2011 blog post announcing the WCRC contract award to PRI, click here.


CMS Acknowledges Conditional Payment Processing Backlog

On February 9, 2016, the Centers for Medicare and Medicaid Services (CMS) posted a notice on their website acknowledging that they were experiencing a backlog in processing Conditional Payment Letters (CPLs) and Conditional Payment Notices (CPNs). They stated that their Commercial Repayment Center (CRC) has issued 33,000 CPLs and CPNs since the October 5, 2015 transition to CRC and that they are actively engaged with the CRC to improve responsiveness and eliminate the backlog.

CMS has undergone quite a few changes recently regarding its conditional payment processing. On October 5, 2015, they transitioned responsibility for conditional recovery activities in Non-Group Health Plan (NGHP) situations to a newly formed group called the CRC. The Benefits Coordination and Recovery Contractor (BCRC) will continue to do recovery activities directly from the beneficiary.

Also on October 5, 2015, CMS began issuing CPNs, instead of their usual CPLs when the BCRC is notified of a settlement, judgment or award from a beneficiary, his or her attorney or other representative, or by Section 111 reporting.

To view a little cheat sheet I put together regarding past CMS Medicare Secondary Payer contractors Click here.

To view the February 9, 2016 CMS notice click here.


CMS Updates WCMSA Reference Guide

On January 5, 2015, the Centers for Medicare and Medicaid Services (CMS) updated its Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide to version 2.3. The initial version of this guide was published on March 1, 2013, which started a welcomed initiative to publish a resource to help users understand the process used by CMS for approving WCMSAs.

Version 2.3 of this guide listed the following changes in Section 1.1:

  • Updated some language to clarify and to correspond with recent changes to letters.
    • Corrected a reference from 42 CFR 411.46 to Section 1862(b)2) of the Social Security Act.
    • Clarified reference to costs related to the workers’ compensation claim, rather than the compensable injury.
    • Clarified reference to future medical items and services as “Medicare covered and otherwise reimbursable”.
    • Clarified that CMS approves the WCMSA amount, not the WCMSA upon submission of a request.
    • Correspondingly, clarified language referring to submission of a proposed WCMSA amount, rather than a WCMSA proposal.
    • Restated the comparison of fee-schedule vs. full-and-actual-costs pricing as the basis of pricing the proposed amount, rather than the basis of payment from an approved WCMSA account.
    • Clarified attestation vs. accounting wording.
    • Clarified procedural results when Medicare is not provided with information in response to a development request.
    • Removed the word “form” from references to documents that are not forms.
  • Added language to address schedule change for hydrocodone compounds from schedule III to schedule II. See Section
  • Changed deadline for responding to development requests for submission through the WCMSA Portal to 20 from the previous 10 days. See Sections 9.4.1 and 9.5.

The inclusion of language to address hydrocodone compounds changing from schedule III to schedule II corresponds to a previous announcement CMS published on November 17, 2014 titled, Notice of Hydrocodone Combination Product Coverage Changes in Medicare Part D Effective for WCMSA Proposals Submitted on or after January 1, 2015. It is also important to note the users now have 20 days to respond to development requests through the WCMSA Portal instead of the previous 10 days.

We applaud CMS for its continuing efforts to provide and update this valuable reference guide, and we will keep you informed as changes are made.


OMB Rejects CMS’ Liability MSA Rule

Last week, the Centers for Medicare and Medicaid Services (CMS) withdrew its recently submitted Notice of Proposed Rulemaking (NPRM) related to protecting Medicare’s interests as a secondary payer with respect to future medical obligations in liability settlements, because it failed to gain approval from the Office of Management and Budget (OMB).

Although the exact reasons for the OMB’s disapproval are not known, the OMB can reject a proposed rule for a variety of reasons, including costs v. benefits, conflict with other agencies or other rules, economic impact, etc.

In June of 2012, CMS took the first step in this process by releasing an Advanced Notice of Proposed Rulemaking (CMS-6047-ANPRM) to solicit public comment on how to implement an MSP process for liability settlements. This ANPRM received many public comments, including one from Medivest, where we strongly encouraged CMS that it is a “practical necessity” that CMS allow an equitable reduction of a liability Medicare Set-Aside (MSA) whenever a liability claim settled for less than full value.

On August 1, 2013, CMS took the next step by sending a Notice of Proposed Rule Making (NPRM) to OMB for their approval. The NPRM was never made public because OMB did not approve it, and on 10/8/2014, CMS withdrew it.  So unfortunately, we do not know what CMS’ specific plan was regarding liability MSAs. However, we fully anticipate that CMS will submit another NPRM to the OMB in the near future.

So while it seems we came very close, nothing has changed regarding how settling parties should consider and protect Medicare’s interests as a secondary payer in liability claims.  We still have a 1980 Medicare Secondary Payer (MSP) statute to deal with, and the existing best practice of analyzing each case to determine if a liability MSA is the best risk assessment decision should still continue.

To view Medivest’s blog announcing the June 2012 CMS-6047-ANPRM click here.

To view Medivest’s response to CMS-6047-ANPRM click here.

To view official OMB notification of withdrawn the NPRM click here.




CMS Allows Partial Social Security Numbers on Future Reporting

In accordance with Section 204 of the Strengthening Medicare and Repaying Taxpayers Act of 2012 (SMART Act), the Centers for Medicare and Medicaid Services (CMS) has issued an Alert that allows Responsible Reporting Entities (RREs) to report partial Social Security numbers to CMS.

Specifically, effective January 5, 2015, when a Non-Group Health Plan (NGHP) cannot obtain Medicare beneficiaries Health Insurance Claim number (HICN) or full Social Security number (SSN), they may instead report the following information instead to enable CMS to properly identify a Medicare Beneficiary:

  • Last five digits of SSN
  • First initial
  • Surname
  • Date of Birth and
  • Gender

If NGHP RREs are unable to obtain or do not provide the HICN, full SSN, or any of the above listed data elements, they must document their attempts to obtain this information.


CMS Allows Entry of Prescription Information Online

The Centers for Medicare and Medicaid Services (CMS) has announced an upcoming enhancement to its Medicare Set-Aside (MSA) Portal that will allow submitters to be able to enter prescription drug information directly to CMS online. Slated to begin on October 6, 2014, this new feature will:

  • Allow MSA submitters to indicate if a claimant is taking, or is expected to take prescription drugs as a result of a workers’ compensation injury, and to select those specific drugs through a lookup feature and add case specific information
  • Display the following information about those drugs: drug name, dosage, National Drug Code (NDC), price per unit and the number of years based on life expectancy
  • Calculate the expected drug cost using the monthly Redbook Drug Reference price that is in effect at the date of submission

CMS said that they will publish another alert prior to implementation with more detailed information. We will provide that info on this blog as soon as it is released.

To view the CMS announcement click here.


Workers’ Compensation Medicare Set-Aside User Guide

The Centers for Medicare & Medicaid Services (CMS) updated its Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) User Guide to version 2.2 to reflect some important changes in the WCMSA program.

The following sections of the guide were added or changed:

4.1.4 Hearing on the Merits of the Case.  This section was added to incorporate previous guidance published in the April 22, 2003 WCMSA RO Memorandum, Question 5, that deals with the issue of when CMS will accept a settlement when a state WC judge approves the WC settlement after a hearing on the merits.

9.4.4 Medical Review, Step 8.   Changes were made in this section to clarify the submission requirements for medical and payment records to reflect that if the records for denied cases reflect a payment, medical records may be required to complete the review process. Pharmacy Guidelines and Conditions.  This section was revised to remove reference to drug tables for physician dispensed drugs and consolidate the drug tapering and drug weaning sections of the previous version.

10.5.2 Use of  WC Fee Schedule vs. Actual Charges for WCMSA. Wisconsin was added to the list of states with no workers’ compensation fee schedule.

10.7 Medical Records.   This section was revised to remove the two-year requirement of medical records for treatment unrelated to the work injury.  It also clarified the statements required by the treating physicians.

10.8 Payment History.  This section was revised to say that the entire payment history must be submitted if the proposal asserts a denial of any condition.

Appendix 6 – List of previous version changes.  This appendix was added to document the changes from the previous version of the guide.

It seems that many of these changes were to address the issues of the recent increase in development letters and requests for additional medical records.  This is another welcome addition to the reference material provided by CMS.  It is nice to see that CMS is working with the MSP compliance industry to address issues, resolve problems, and provide published guidance as issues arise.

Marilyn Tavenner Confirmed as the Administrator of the CMS

MTavennerYesterday, by a vote of 91-7, the U.S. Senate approved President Obama’s nominee to be the administrator of the Centers for Medicare and Medicaid Services (CMS).  Ms. Tavenner became Acting Director in 2011, upon the resignation of then Principal Deputy Director, Dr. Donald Berwick.  She started her career and an intensive care registered nurse and worked her way up to become CEO of a Richmond, VA hospital.

She received strong bi-partisan support in the Senate confirmation hearings in April.  Interestingly, in these confirmation hearings, she made a commitment to Senator Baucus (D-MO) to improve the Medicare Secondary Payer program backlog and the situation in Libby, Montana.

Medicare and Medicaid combined is the world’s largest health insurer.  They provide health care benefits to about 100 million Americans and spend approximately $1 trillion, which is more than the Department of Defense.  In addition, CMS has a primary role in the implementation of the Affordable Care Act, aka “ObamaCare.”

Congratulations to Mrs. Tavenner.  She has a difficult task ahead of her, but she certainly seems to have the qualifications and experience to be an outstanding leader of the CMS.

To view yesterday’s HHS press release, click here

To view a clip of the confirmation hearings where she addresses the MSP program and Libby Montana, click here.

To view our previous post on Libby Montana, click here.


Highlights of CMS’ WCMSA Town Hall Teleconference

The Centers for Medicare and Medicaid Services (CMS) held its first ever Workers’ Compensation Medicare Set-Aside (WCMSA) Town Hall Conference today.

After introductions, Provider Resources, Inc. (PRI), the new Workers’ Compensation Review Contractor (WCRC), introduced their staff and provided a review of their WCMSA review process.

Below are some highlights and observations of the Town Hall Teleconference:

  • The WCRC has assembled an impressive team of well qualified experts to review WCMSAs including: doctors, nurses, certified coders, case managers, life care planners, lawyers, pharmacists, etc.
  • The WCRC uses Evidence Based Medicine guidelines to review WCMSAs.
  • The WCRC provided a specific, detailed and transparent explanation of the ten steps reviewers use to evaluate WCMSAs.
  • The WCRC’s chief pharmacists provided detailed guidance on PRI’s drug review guidelines.
  • The CMS website is being redesigned to provide better information to stakeholders.
  • While CMS does not have a formal appeals process, it does have an informal re-review process that has been in place for many years.
  • CMS and the WCRC will continue to strive to provide clear instructions and transparency.
  • CMS received over 100 questions in advance regarding this teleconference.
  • A transcribed copy of the teleconference will be provided on the CMS website in about two weeks.

Overall, it was a very impressive teleconference call.  Barbara Wright, from CMS closed the call by stating that CMS is striving to provide clear instructions and improved transparency so that the entire process can be as accomplished as seamlessly as possible.


CMS Announces a Workers’ Compensation Medicare Set-Aside (WCMSA) Town Hall Teleconference for April 11, 2013

The Centers for Medicare and Medicaid Services (CMS) will host a town hall teleconference on Thursday, April 11, 2013 for stakeholders to learn more about the Workers’ Compensation Review Contractor (WCRC) and other procedural matters that are not case specific. Questions had to be submitted in advance but there may be an opportunity to ask questions after the presentation.

The new WCRC, Provider Resources, Inc, began in July of 2012, and has done a great job of clearing up the backlog of WCMSA cases and improving efficiencies. Education and outreach activities on a continuous and proactive basis was a requirement of the new WCRC contract.

To summarize all this recent flurry of educational and outreach activity from CMS just in the last few days, CMS has:

  • Published a new reference guide for WCMSAs
  • Confirmed that four CMS representatives will speak at the National Alliance of Medicare Set-Aside Professionals (NAMSAP) Annual Meeting in Baltimore on April 25-26
  • Announced a, first of its kind, WCMSA town hall teleconference

Specific details of the WCMSA Town Hall Teleconference are as follows:
Date of Teleconference: April 11, 2013
Call in time: 2:30-4:30p.m. EST
Call-in line: (800) 603-1774
Pass Code: WCRC


CMS Releases Updated Life Tables

On December 17, 2012, The Centers for Medicare and Medicaid Services (CMS) posted a notice on its website indicating the Centers for Disease Control has published its 2008 United States Life Tables.   The notice goes on to state that newly submitted WCMSA proposals received by the COBC, uploaded via the web portal or reopened on or after January 19, 2013 should utilize the 2008 United States Life Table 1 for all life expectancy calculations.

2012 Medicare Trustees Report

The Medicare Board of Trustees submitted their 2012 annual report to Congress, dated April 23, 2012.  Interestingly, the federal Social Security Act requires the board report annually to Congress on the financial and actuarial status of the Medicare Trust Funds.  This 2012 report is the 47th report that has been submitted.

Some key highlights of the report are:

  • Large uncertainties in the sustainable growth rate (SGR) formula, the “Affordable Care Act”, and other issues could mean that future Medicare costs could be much higher than those shown in the “current-law projection”.
  • In 2011, Medicare covered 48.7 million people; 40.4 million aged 65 and older and 8.3 million disabled.
  • Total expenditures in 2011 were $549.1 billion.
  • The estimated exhaustion date for the Hospital Insurance (HI) trust fund (aka Medicare Part A), remains at 2024.  HI expenditures have exceeded income since 2008 and have not met the Trustees’ formal test of short-range financial adequacy since 2003.
  • The Supplemental Medicare Income (Parts B and D) trust fund is adequately funded over the next 10 years and beyond because premium and general revenues are reset each year to match expected costs.

The Acting CMS Administrator Marilyn Tavenner said, “The Trustees Report tells us that while Medicare is stable for now, we have a lot of work ahead of us to guarantee its future.”

To view the actual report, click here.