Workers' Compensation Claims and the Medicare Secondary Payer Act

Transcription

1 Presenting a live 90-minute webinar with interactive Q&A Workers' Compensation Claims and the Medicare Secondary Payer Act Meeting Reporting Requirements, Satisfying Liens, and Establishing Set-Asides in Settlements TUESDAY, SEPTEMBER 10, pm Eastern 12pm Central 11am Mountain 10am Pacific Today s faculty features: Bradford Peterson, Partner, Heyl Royster Voelker & Allen, Urbana, Ill. John Cattie, Head, Future Cost of Care Practice, Garretson Group, Charlotte, N.C. The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions ed to registrants for additional information. If you have any questions, please contact Customer Service at ext. 10.

2 FOR LIVE EVENT ONLY Sound Quality If you are listening via your computer speakers, please note that the quality of your sound will vary depending on the speed and quality of your internet connection. If the sound quality is not satisfactory and you are listening via your computer speakers, you may listen via the phone: dial and enter your PIN when prompted. Otherwise, please send us a chat or sound@straffordpub.com immediately so we can address the problem. If you dialed in and have any difficulties during the call, press *0 for assistance. Viewing Quality To maximize your screen, press the F11 key on your keyboard. To exit full screen, press the F11 key again.

3 FOR LIVE EVENT ONLY For CLE purposes, please let us know how many people are listening at your location by completing each of the following steps: In the chat box, type (1) your company name and (2) the number of attendees at your location Click the SEND button beside the box If you have purchased Strafford CLE processing services, you must confirm your participation by completing and submitting an Official Record of Attendance (CLE Form). You may obtain your CLE form by going to the program page and selecting the appropriate form in the PROGRAM MATERIALS box at the top right corner. If you'd like to purchase CLE credit processing, it is available for a fee. For additional information about CLE credit processing, go to our website or call us at ext. 35.

4 FOR LIVE EVENT ONLY If you have not printed the conference materials for this program, please complete the following steps: Click on the ^ sign next to Conference Materials in the middle of the lefthand column on your screen. Click on the tab labeled Handouts that appears, and there you will see a PDF of the slides for today's program. Double click on the PDF and a separate page will open. Print the slides by clicking on the printer icon.

5 WORKERS COMPENSATION CLAIMS AND MSPA Brad Peterson Heyl, Royster, Voelker & Allen Urbana, Illinois John V. Cattie, Jr. Garretson Resolution Group Charlotte, NC

6 CONTRACT LANGUAGE Acknowledge Medicare s interest MSA amount MSA approved or to be approved Terms of self-administered MSA Open medical if MSA rejected 6

7 CONTRACT LANGUAGE If no MSA explain why Record keeping requirements 7

8 SETTLE NOW NOT LATER Settle claim before petitioner reaches 62 ½ years of age 8

9 SETTLE NOW APPLY LATER Petitioner waits to file SSDI claim until after settlement of workers compensation claim 9

10 APPEAL DENIED Await settlement until pending SSDI appeal is denied 10

11 NO FUTURE TREATMENT NO MSA MSA only where future treatment reasonably anticipated Caveat: CMS Memo 4/22/03 and settlement only for past medical expense 11

12 ZERO ALLOCATION Acquire MSA proposal with zero allocation based upon highly disputed facts and substantial compromise 12

13 SETTLEMENT BELOW MSA THRESHOLDS Negotiate settlement below $25,000/$250,000 thresholds to avoid time and expense of CMS approval 13

14 LIABILITY MSA S PROPOSED REGULATIONS 14

15 PUBLISHED FEDERAL REGISTER VOLUME 77, NO. 166 Friday, June 15, 2012 When enacted will codify CMS s position requiring liability Set-Asides 15

16 MUST PROTECT MEDICARE FOR FUTURE MEDICAL EXPENSE, if Current Medicare beneficiary. or, Claimants who reasonably anticipate receiving Medicare covered services for injury after settlement Seven options to protect Medicare Options 1 through 4 apply to all cases Options 5 through 7 apply only to current Medicare beneficiaries 16

17 OPTION 1 Beneficiary chooses to pay all future medical expense until settlement exhausted No annual accounting but periodic audits Medicare will begin covering injury related expenses when settlement funds exhausted 17

18 OPTION 2 Medicare will not pursue future medicals if; A.) Accident, illness or injury occurred 1 year or more before settlement; Claim did not involve chronic illness or major trauma; Claimant does not receive additional settlements nor workers compensation or no fault insurance claim or, 18

19 B.) Settlement less than defined amount (to be determined) Claimant not current Medicare beneficiary Claimant does not expect to become beneficiary within 30 months Claim does not involve chronic illness or major trauma Beneficiary does not receive additional settlements Claimant does not have corresponding workers compensation or no fault insurance claim 19

20 What is chronic illness or major trauma? Serious injury to two or more ISS body regions or, ISS score greater than 15 20

21 BODY REGIONS: Head or neck, face, chest, abdomen, extremities, external 21

22 ISS = INJURY SEVERITY SCORE. 22

23 23

24 CHRONIC ILLNESS Is a condition or disease lasting more than three months. Examples: chronic breathing difficulty, cancer, diabetes, quadriplegia and/or fibrosis. 24

25 OPTION 3 Before or after settlement, physician attests that future medical expense not expected 25

26 OPTION 4 Medicare Set-Aside arrangement prepared and submitted to CMS for review 26

27 OPTION 5 RECOVERY OPTIONS: Settlement $ or less; Settlement below $5, pay 25 percent to Medicare; Settlement $25,000 or less claimant can self calculate amount to protect Medicare for future medical expense 27

28 OPTION 6 UPFRONT PAYMENT: Pay Medicare a lump sum payment to cover calculated cost of future medical; Lump sum payment to Medicare in the amount of a fixed percentage of settlement amount 28

29 OPTION 7 COMPROMISE OR WAIVER: Beneficiary may request CMS compromise or waive recovery 29

30 DOUBT NO LONGER EXISTS AS TO MEDICARE S POSITION! 30

31 PROPOSED REGULATIONS MAY BE SUBSTANTIALLY ALTERED PRIOR TO ADOPTION 31

32 REGULATIONS TO BE PUBLISHED SEPTEMBER

33 Bradford Peterson Heyl Royster Voelker & Allen Urbana, Ill

34 Ready for Adventure? The SMART Act and Medicare Set Asides September 10, 2013

35 The SMART Act and Medicare Set Asides John Cattie 35

36 Base Camp: Map the Path & Timeline to Resolution Climbing the Mountain: SMART Act Overview The Treacherous Descent: CMS WCMSA Reference Guide Take-Home Climbing Gear 36

37 Base Camp: The Path & Timeline to Resolution Past Interest MMSEA Future Interest Date of Injury Case Intake/ Retainer Send Demand/ File Lawsuit Negotiations Date of Settlement Receipt of Funds Distribution of Proceeds Up to $1,000 Penalty per day per claimant for non-compliance 37

38 Additional Gear: The SMART Act SMART Act Strengthening Medicare and Repaying Taxpayers Act Signed into law by President Obama on January 10, 2013 Impacts 2 of the 3 Medicare Secondary Payer MSP components: Repayment & Reporting 38

39 Additional Gear: The SMART Act Intended to improve efficiencies of Medicare s current recovery process for conditional payments Rewards settling parties who take a proactive approach to addressing Medicare s recovery interests in the beginning stages of settlement Benefits to planning ahead: 1. Ability to make more informed pre-settlement decisions 2. Option of a fast-tracked process in identifying and resolving Medicare s recovery interests 3. Assurance that there will not be any post-settlement complications relating to MSP conditional payment reimbursement obligations 39

40 SMART Act: Section 201 Requires the Centers for Medicare and Medicaid Services ( CMS ) to maintain a secure web portal for settling parties to use as an early warning system Allows settling parties to notify CMS of an anticipated settlement, judgment, or other payment prior to settlement You can then efficiently resolve any Medicare repayment claims using the website following a specific process and timeline Implementation Timeline: CMS will have 9 months (October 10, 2013) from the date of enactment to issue final regulations to carry out Section 201 Process is likely to be phased in over a set period of time to allow for implementation changes 40

41 SMART Act: Section 201 Process required by Section 201: Important Note: to take advantage of the fast-tracked resolution process, notification to Medicare must occur within 120 days of settlement, and the entire process must be completed within that timeframe 41

42 SMART Act: Additional Provisions Provision Summary Implementation Timeline Section 202 Reimbursement & Reporting Thresholds Section 203 MMSEA Reporting Penalties Section 204 Use of SSNs, HICNs Optional Section Year Statute of Limitations Settlements/judgments/awards below the annual threshold amount will not trigger reimbursement or Mandatory Insurer Reporting ( MIR ) obligations Does not apply to ingestion, exposure or implantation cases The mandatory $1,000 per day penalty is now a permissive one Responsible Reporting Entities (RREs) no longer required to gather or report SSNs or HICNs US must file a complaint within 3 years following notice of a settlement/judgment/award provided as a result of MMSEA reporting Applies to years beginning in 2014 thus, the Sec. of HHS has to issue a cap report on Nov. 15, 2014 Effective once final regulations are issued Section 111 rules to be modified within 18 months of enactment by July 10, 2014, with one year extensions for patient privacy / MSP integrity reasons Applies to all actions brought and penalties sought on or after 6 months from date of enactment, which would be July 10,

43 Reaching the Summit? 5-Step Process to Ensure MSP Compliance: 1. Settlement agreement contains language describing the MSP compliance process (i.e. representations and warranties). 2. Plaintiff shares evidence that recovery record has been opened with Medicare (i.e., results of entitlement search). 3. Defendant identifies whether and how to report under Section Parties agree on manner of payment (i.e. holdback, buffer, payment routing). 5. After final resolution with CMS, plaintiff provides proof of satisfaction back to defendant to document defendant s file. 43

44 MSAs: The Basics Certain amount of proceeds to satisfy MSP statutory requirements Covers future injury-related care otherwise covered by Medicare MSAs are a subset of the future medicals award Think insurance deductible 44

45 MSAs : Statutory Obligation According to MSP Act, payment may not be made with respect to any item or service to the extent that payment has been made or can reasonably be expected to be made under a workers compensation plan, an automobile or liability insurance plan (including a self-insured plan) or under no fault insurance. 45

46 MSAs: Workers Compensation Regulations 42 C.F.R (d) Lump-sum compromise settlement: Effect on payment for services furnished after the date of settlement 1)Basic Rule. Medicare pays for future injury-related care. 2)Exception. If WC award contains dollars for future medicals, that amount must be spent down and exhausted before Medicare pays 46

47 MSAs: Workers Compensation Regulations 42 C.F.R (a) Determining amount of compromise settlement considered as a payment for medical expenses. 1) If a compromise settlement allocates a portion of the payment for medical expenses and also gives reasonable recognition to the income replacement element, that apportionment may be accepted as a basis for determining Medicare payments. 47

48 MSP Case Law : Apportionment for Medicals Benson v. Sebelius, 2011 U.S. Dist. LEXIS Decided March 24, 2011 if a settlement covers both medical and nonmedical costs, CMS s reimbursement may be apportioned so as to reach only the portion of the settlement allocated to cover medical costs. 48

49 CMS WCMSA Reference Guide o Released March 29, 2013 o Consolidates all previous guidance in 88 page guide o Clarifies certain misconceptions 49

50 1.0 About This Reference Guide CMS says the following about WCMSAs: 50

51 2.0 Introduction to Workers Comp and Medicare 2.1 Medicare as Secondary Payer 2.2 Reporting a WC Case 2.3 Past and Future Medical Services CMS distinguishes between conditional payments for past medicals and future medical services 51

52 3.0 What are WCMSAs? CMS says the following about WCMSAs: 52

53 4.0 Should I Consider Submitting A WCMSA Proposal? 4.1 Considerations and Guidelines Commutation and Compromise Outstanding WC Claims 4.2 When Establishing a WCMSA is Not Necessary 53

54 5.0 WCMSAs Can Be Funded in Two Ways 5.1 Lump-Sum WCMSAs 5.2 Structured WCMSAs 54

55 6.0 Who Can Help with the WCMSA Process? 55

56 7.0 How is CMS Approval of a WCMSA Amount Obtained? 56

57 8.0 Should CMS Review a WCMSA? 57

58 8.1 Thresholds 58

59 10.0 Information Needed for WCMSA Submission 59

60 Section 10 Consent to Release Form 60

61 Section 25 Settlement Agreement or Proposed or Court Order 61

62 11.0 How Do I Submit a WCMSA? 11.1 Electronic Submission Via the WCMSAP Benefits of Using the WCMSAP 11.2 Paper Copy/CD Submission Via the Mail Paper Copy CD 62

63 12.0 What Happens after a WCMSA Has Been Submitted? 63

64 13.0 Sample Submission 64

65 14.0 Tips for Improving Your WCMSA Review Process 65

66 16.0 Re-Review 66

67 18.0 CMS Monitoring 67

68 CMS WCMSA Reference Guide: Myth 1 Submitting MSA proposals to CMS for review/approval is voluntary, not mandatory. Section 1.0, page 1, WCMSA Reference Guide v1.3 68

69 CMS WCMSA Reference Guide: Myth 2 MSAs are a Plaintiff Concern, not a Defense Concern Section 3.0, page 3, WCMSA Reference Guide v1.3 69

70 MSA Reaction - American Insurance Association 70

71 MSAs: Ethical Concerns for Plaintiff Attorneys Plaintiff Attorneys Must Adhere to Rule 1.1 Competence Rule 1.3 Diligence Rule 1.4 Communication Rule 1.15 Safekeeping Client Property With clear guidance from CMS, noncompliance is not an option. 71

72 Practical MSA Compliance Tips 3 things to start doing today to ensure compliance: 1.Honest Internal Discussion Re: Policy/Procedure on Future Meds Formalized Approach Yields Compliant Results 2.Update Case Intake to Capture Relevant Data Medicare Enrollment Status (SSDI, Age, ESRD) 3.Seek Help (as needed) Build It or Buy It 72

73 MSA Decision Engine: A New Allocation Tool MSA Decision Engine Web based self-service technology 24/7 accessibility GRG s formalized approach at your fingertips Ensure Medicare s future interest is appropriately considered Free pre-screening checklist Develops: Claimant profile Claims/injury profile Healthcare profile Litigation profile Is MSA appropriate based on case specific facts? 73

74 MSA Decision Engine: How to Use 1. Run Prescreener Within One Week of Case Intake 2. If no MSA needed decision rendered, download free report for file 3. If MSA might be needed decision rendered, step away days from mediation, reenter, answer additional questions and generate results charge incurred 5. At mediation, rerun report (for free) based on changed data 6. Once settlement is final, rerun report (for free) once more and keep in file going forward. 74

75 Additional Resources: GRG Learning & Resource Center Downloadable client alerts, practice tips, whitepapers, guides, publications and additional resources 75

76 76 Questions?

77 Conclusion Thank you! 77