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Birmingham Bar Association Bulletin - Fall 2014

such action at the end of 2013, so we can only hope that the process is resumed in 2014 so that parties and insurers can receive some clarity as to their obligations regarding future medicals in liability settlements with Medicare beneficiaries. Examples of some of the options being considered are as follows: •  Medicare beneficiary or individual pays for all related future medicals until the settlement is exhausted and documents accordingly; CMS would not review documentation in conjunction with this option but may request documentation from beneficiaries at random. •  Medicare would not pursue future medicals in liability settlements that contain no workers’ compensation/no-fault claim element and the settlement is below a defined amount. •  MSP recovery is limited to conditional payments only if the beneficiary acquires a physician attestation that no future treatment is anticipated. If the date of completion is after settlement, future medicals would be limited through that date. •  Implement a formal MSA and CMS approval process for liability insurance MSA amounts, similar to what is currently in place for workers’ compensation. The “individual/beneficiary” would submit the proposed MSA to CMS. •  If the beneficiary participates in any of the new MSPRC conditional payment recovery options (set forth below), future medicals would also be considered satisfied. •  (A) If ORM (Ongoing Responsibility for Medicals) is present, CMS would take an upfront payment of the future medical amount that is set aside for Medicare-covered treatment. This option would be used in place of self-administration or custodial accounts as long as CMS has reviewed and approved a proposed MSA amount. (B) Where there is no ORM and the beneficiary receives a settlement, an upfront payment can be made to Medicare in the amount of a specified percentage. •  Medicare would not pursue future medicals in cases where CMS has granted compromise or waiver of recovery for conditional payments in relation to that case. Again, however, no action has been taken concerning any of these options since mid-2013. Settlements B. Medicare has recently implemented payment options for settlements, judgments or awards that meet certain conditions or criteria. These options are dependent on the amount of the settlement and do not apply to claims involving ingestion, exposure or implantation. 1. $300 Threshold Medicare has implemented a $300 threshold on liability cases, meaning that Medicare will not seek reimbursement of its lien on a settlement that is $300 or less. This option went into effect September 1, 2011, and does not apply when an insurer is paying or has paid medical bills directly or on an ongoing basis. The threshold option requires that the Medicare beneficiary has not received and does not expect to receive any other settlements, judgments, awards, or other payments related to the incident and that Medicare has not previously issued a recovery demand letter. Medicare Law 2. Fixed Percentage Option Medicare has also implemented a fixed percentage option for settlements that are $5,000 or less. The claimant can agree to pay Medicare 25% of the total settlement at the time of settlement without waiting for Medicare to provide the final lien information. The fixed percentage option went into effect as of November 7, 2011. Under this option, neither the conditional payment amount nor an attorney fee affects the amount due Medicare. To pursue this option, a request must be submitted prior to, or with, the documentation for the Notice of Settlement. Model language for the request may be found at www.msprc.info. The Medicare beneficiary must elect this option within the required timeframe and before Medicare has issued a demand letter or other request for reimbursement related to the incident. Again, the beneficiary must not have received or expect to receive any other settlements, judgments, awards or other payments related to the incident. 3. Self-Calculated Final Conditional Payment Option Beginning February 21, 2012, for settlements that are $25,000 or less, Medicare has enacted a self-calculating option. Additionally, it is required that the date of incident occurred at least six months prior - it must be six months from the date of incident to the date the Medicare beneficiary or his/her representative submits the self-calculated final conditional pay- Birmingham Bar Bulletin/ Fall 2014 23


Birmingham Bar Association Bulletin - Fall 2014
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