medicare secondary payer – process and best practices october 21, 2009
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DESCRIPTIONMedicare Secondary Payer – Process and Best Practices October 21, 2009. Roy A. Franco, Safeway Inc./ Medicare Advocacy Recovery Coalition. Tax Revenue Consumed By Medicare & Social Security. 61%. 49%. $89 Trillion. 27%. 13%. 2040. 2020. 2030. 2010. MSP History. - PowerPoint PPT Presentation
Medicare Secondary Payer Process and Best Practices
October 21, 2009
Roy A. Franco, Safeway Inc./ Medicare Advocacy Recovery Coalition
201020202030204013%27%49%61%Tax Revenue Consumed By Medicare & Social Security$89 Trillion
Medicare ActMedicare Secondary Payer MSP History196520031965 Medicare Act1980 Medicare Secondary Payer Act2003 Medicare Modernization Act2007 MMSEA 111
MMSEA - 111Medicare Secondary Payer Act 42 USC 1395y(b)(2)Medicare Set Aside
411.25 Primary payers notice of primary payment responsibility.
If it is demonstrated to a primary payer that CMS has made a Medicareprimary payment for services for which the primary payer has made or should have made primary payment, it must provide notice about primary payment responsibility and information about the underlying MSP situation to the entity or entities designated by CMS to receive and process that information.
[54 FR 41734, Oct. 11, 1989; as amended at 55 FR 1820, Jan. 19, 1990; 73 FR 9684, Feb. 22, 2008]
411.24 (i) Recovery of conditional payments. Special rules. (1) In the case of liability insurance settlements and disputedclaims under employer group health plans and no-fault insurance,the following rule applies: If Medicare is not reimbursed as required by paragraph (h) of this section, the third party payer must reimburse Medicare even though it has already reimbursed the beneficiary or other party.
Contingent LiabilitiesElectronic Reporting Penalties42 CFR 411.24(i)Double DamagesNo Safe HarborNo DefensesEstoppelShelf lifeNo AppealFinality
Interest accrues, if full refund not received in 60 days.Accident occurs.Injuries associated with accident are paid by Medicare.Negligent Party becomes aware of accident involving Medicare Beneficiary.COBC gathers additional facts about the accident.Reports accident to COBC per 42 CFR 411.25 (a).Populates Common Working File.COB acknowledges claim notification or sends notice to negligent party. Consent form attached.10-14 daysAcknowledges receipt of claim and investigates conditional payments related to accident. Reported information is submitted to the Recovery Management Accounting System to identify conditional payments.MSP leads identified and related case claims retrieved.MSPRC receives ReMAS Alert and applies filters to identify related claims.ReMASMSPRC works with negligent party to reach agreement on accident related claims.Settlement occurs.Parties sends settlement Documents to MSPRC.14 days$$$MSPRC identifies $ owed to Medicare; sends demand letter.Post demand correspondence regarding relatedness.Send MSPRC the refund check.If full refund not received MSPRC sends Intent to Refer letter.If full refund not received after 120 days, case is referred to Treasury.MSPRC case complete.Waiver or Compromise.MSP CONDITIONAL PAYMENTS LIFECYCLEMSPRC sends Conditional payment letter.45 daysResolvedAgreesDisputePaymentDispute30 daysUpdated Conditional Payment Letter is sent.30 days30 daysDuplication without express written consent of MARC is prohibited
Waiver of the private cause of action under 42 U.S.C. 1395y(b)(3)(A);
Identify injuries related to the tort with applicable ICD-9 codes;
Settlement may impact plaintiffs future benefits, and claimant has the right to seek waiver, compromise and otherwise reduce the amount sought by Medicare based upon costs to procure the settlement;
Cooperation Clause / survivability of consent form;
Affirmative obligation requiring plaintiff to provide copies of any settlement agreements or other communications plaintiff has with Medicare on case;
Statement that the plan has exhausted all benefits, listing the TPOC date and amount.
How disbursements are to be handled.
Pay Attention to the Settlement Release
Conditional Payments 42 USC 1395y(b)(2)(B) Allocation ChallengesZinman v. Shalala Hadden v. U.S.Bars to SettlementDamagesMedical SpecialsAll Other DamagesSETTLEMENTJudicial Determination
Liability Medicare Set AsidesNo Regulations
No Bulletins / Alerts
No safe harbor applying Workers Compensation guidelines
MSP provisions say Medicare is always secondary to WC and other insurance
No payment may be made under Medicare for covered items or services to the extent that payment has been made, or can reasonably be expected to be made.
Medicares authority to review liability settlements arises under same statute as its authority to review Workers Compensation settlements (See 42 USC 1395y(b)(5)(d), 1395y(b)(6)
$20,000$80,000Past Medical ExpenseNet to Plaintiff ? $100,000 Settlement Example
LegislatureRegulatoryCommon Law Hadden v. U.S.To Join:Visit http://www.marccoalition.comContact Susan Murdock email@example.comFinancial contributions needed! Medicare Advocacy Recovery Coalition
Questions and Answers
Matt WelcomeHousekeeping Handouts On-line QuestionsIntroductionsRoyDRI PartnershipSafeway backgroundMARCJeffDRI thank youGoldberg Segalla member / AuthorBackground with Medicare COB and MSPRC AcronymsPractice Guide
RF Why do we have this law?Entitlement programs consume U.S. Budget2010 2040 larger portion of tax revenue to service SS and MedicareFinancially improbable to keep paceAlternativesRaise Taxes Reduce benefits Find alternative funding sources Illl find You MSP is alternative funding source no sympathy for insurance carriers, self insureds, lawyersBenefits promised over anticipated revenues - $89T44M on Medicare today80M in about 7 yearsThe Gap has to be closed sense of urgency by Centers for Medicare & Medicaid Services to fill itJS - Conservative
RF/JS MSP History Review quickly ground covered by Trusiak & ThorntonMedicare Act 1965 Whos covered: Seniors, Qualified disabled persons (24 months), Anyone with ESRDWC designated primary payer really template for MSP no payment may be made for any time or service for which payment has been made, or can reasonably be expected to be made, under a workmans compensation law or plan any payment with respect to any [such] item or service must be conditioned on reimbursement being made to the appropriate trust fund 1862MSP 12/5/1980 correct mischief by GHP remove Medicare as primary payerDefined primary plan as workers compensation law or plan, an automobile or liability insurance policy or plan (including self-insured plan) or no fault insurance bottom line Medicare secondary when beneficiary has other primary insurance or healthcare plan.The Courts 1980 2003 Conflict - Thompson v. Goetzman (5th Cir) and U.S. v. Baxter (11th Cir) MMA 2003 - Codified U.S. v. Baxter MSP applies to liability Added enforcement powers against any entitybeneficiary, provider, supplier, physician, attorney, state agency or private insurer.Settlement agreement doesnt matter no allocation, no liability trigger for exposure = $$$MMSEA 111 for defendants onlyElectronic reporting after payment of settlement, award, judgment or other paymentQui Tam Representative Doggett - TexasRF MSP can be likened to an icebergReally three components mention three componentsAdverse consequences to clients that dont understand entire pictureJS MMSEA 111Reason here today tip of iceberg Electronic reporting clients responsibility triggered when settlement, judgment, award or other paymentThats the end of the case no help for settlement more importantly, does not remove contingencies be proactive!RF MSPSection 111 does not alterin addition to responsibilities that existed under the Act Town Hall ConferencesHit or miss enforcement because Imperfect knowledge by Medicare no penalty associated with itRequires reporting from moment there is an expectation of payment helps with settlementNo thresholdsRF/JS MSAControversalRecommend case by case review does the settlement contemplate a payment for future medical expense?JS West coast involving multiple defendants reason controversal
JS / RF - 42 CFR 411.25(a)Outlines duty to self report notify vs. electronic reportingDemonstrate = key wordStarting point information is required for settlement avoid contingenciesAs early as possible takes timeRF / JS 42 CFR 411.24(i)Insurance carrier / self insured nightmare pay again regulationNeed to protect Medicares shareChapter 7 MSP, 50.5.3 directs Medicare contractors to try and recover any Medicare payments directly from liability insurer or self insurer BEFORE proceeds are distributed. No longer is indemnification by itself for all liens by beneficiary sufficient protection. Trusiak Release needs to be carefully tailored for each situation no templates.RF Transition to Contingent liabilites slide.Medicare will have perfect knowledge of:All liablity claims that meets established thresholds [in alerts found on CMS website]$5K or more through 12/31/2011$2K or more through 12/31/2012$600 or more through 12/31/2013$0 Medicare will use over 255 fields of information for collectionNeed to protect funds at time of settlement otherwise implications of 42 CFR 411.24(i)Involve Medicare as soon as possible collect necessary information use settlement agreement to set terms to protect against Medicare contingenciesJS Talking pointsPenaltiesDevelop process to properly ID Medicare beneficiary Update discovery Motion Practice Include in Scheduling OrderOngoing responsibility no defense unless use FORM Carefully review Medical billing records Medicare is not MEDICAID42 CFR 411.24(i)Medicare contractors want to collect from insurance or self insured prior to disbursement If disburse adequate protections for funds before