In years past (pre-1980’s), Medicare beneficiaries would settle their claims with workers’ compensation and then the very next day, would put medical services through Medicare. CMS/Medicare did not appreciate paying for expenses that should otherwise be covered by workers’ compensation (or other payers), and thus the Medicare Secondary Payer Act was enacted. The MSP comes into play when Medicare pays for workers’ compensation treatment (called conditional payments) or in settlement- the workers’ compensation Medicare set aside arrangement (WCMSA).
The MSP has borne guidance in the form of the WCMSA—the current guidelines for review of a WCMSA are:
- Current Medicare Beneficiary and settlement over $25,000
- Reasonable expectation of Medicare enrollment within 30 months of settlement and settlement is over $250,000.
A Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) is a financial agreement that allocates a portion of a workers’ compensation settlement to pay for future medical services related to the workers’ compensation injury. These funds must be depleted before Medicare will pay for treatment related to the workers’ compensation injury. I always give the example that this WCMSA is like a deductible for Medicare. As such, once the deductible (the amount set aside) is expended, the injured worker can then put the injury related treatment through Medicare.
All parties in a workers’ compensation case have significant responsibilities under the Medicare Secondary Payer (MSP) laws to protect Medicare’s interests when resolving cases that include future medical expenses. The recommended method to protect Medicare’s interests is a WCMSA.
The amount of the WCMSA is determined on a case-by-case basis. WCMSA vendors typically create an MSA—using what it thinks would be the future injury related Medicare-covered medical care looks like—that report is then submitted to CMS/Medicare and then CMS signs off (or not) on the allocated amount.
While an injured workers who is a Medicare beneficiary (or someone who has a reasonable expectation of Medicare entitlement) can settle his or her workers’ compensation claim, the involvement of Medicare/CMS creates additional burdens and red tape on all parties to a workers’ compensation claim. It also cuts into the injured worker’s “bottom line” and what they receive from a settlement. He or she sometimes receives the monies allocated to the WCMSA, but he/she must set that amount aside in a separate account to pay for his/her injury related treatment covered by Medicare, and submit annual accountings of the account expenditures.
If you have questions about a Medicare set aside account (WCMSA) and how it impacts your Florida workers’ compensation claim, please contact our office for a free consultation.