Medicare Secondary Payer Mandatory Reporting

Provisions in Section 111 of the MMSEA

CMS Update

Work Comp Corner:  September 14, 2011

On September 6, 2011, the Medicare Secondary Payer Recovery Contractor announced that Medicare has implemented a $300 threshold for certain liability insurance cases.  This is the first time that Medicare has imposed a threshold related to its rights of reimbursement under the Medicare Secondary Payer Act.  Assuming that all of the following criteria are met when a liability insurance claim is resolved, Medicare will not recover from the recovery proceeds if:

• The settlement (which Medicare defines to include settlement, judgment, award or payment) is related to an alleged physical trauma-based incident. (This rule does not include alleged ingestion, implantation or exposure-based incident).

• The beneficiary obtains a liability insurance (including self-insurance) settlement, judgment, award, or other payment for a Total Payment Obligation to Claimant (TPOC) of $300 or less.

• There are no multiple settlements, judgments, awards or other payments for the same underlying claim which total more than $300.

• Medicare has not issued a final demand.

We continue to assess Medicare's interests in settlements related to asbestos, pharmaceutical or environmental claims.  This rule does not impact the reporting requirements, which have different threshold levels.

If you have any specific questions about this or other worker's compensation matters, please contact Ann Stewart or Karen Dutcher.