General Information

The 67th Annual Workers’ Compensation Educational Conference and the 24th Annual Safety and Health Conference are just around the corner. Set for August 19 through 23, 2012 at the Orlando World Marriott, the conference will again focus on the national workers’ compensation and safety industries, serving as a gathering of national stakeholders to study and be educated on issues of common concern.  For the first time, the Conference program has expanded to a fourth day (Thursday, August 23) with a full 2-day breakout for mediators.

Program

As usual, this year’s program offers creative and innovative speakers from around the country. The hottest issues in workers’ compensation and safety will be discussed. All aspects of workers’ compensation and workplace safety will comprise the topics of discussion with breakouts for risk managers, regulators, safety professionals, health care providers, adjusters, insurance professionals, attorneys, medical case managers, professional employer organizations (employee leasing), temporary staffing, mediators, and medical office administrators.

Medicare Secondary Payer Act Compliance

Sponsored by Gould & Lamb, LLC, this year’s conference will again be the only national conference to feature a full-day breakout on the Medicare Secondary Payer Act and related subjects. One of the most difficult areas in handling workers’ compensation and general liability matters is understanding and dealing with the serious pitfalls that this expanding responsibility creates. The comprehensive breakout will clarify what has become an extremely complicated process that has created enormous issues for the workers’ compensation industry, soon to further expand into the general liability area.

Providing Clarity in a Land of Confusion

Program Moderator, Bret Cade, Executive VP of Sales at Gould & Lamb, LLC will lead the day long seminar. Planned presentations include Medicare Secondary Payer Act 101: The Reader’s Digest Version by Roy Franco, Esq., Principal at Franco Signor, LLC, The Eye in the Sky: Mandatory Insurer Reporting by Scott Huber, Vice President of Information Technology at Gould & Lamb, LLC and Jeff Gurtcheff, VP and General Manager at PMSI, Render Unto Caesar What is Caesar’s: Conditional Payments  Resolution by Wanda Reas, Esq., Partner at Znosko & Reas, P.A. and John Cattie with the Garretson Resolution Group, So Let It Be Written, So Let It Be Done: A Legislative and Case Law Update by Mark Popolizio, Esq., Senior Legal Counsel at Crowe Paradies and Roy Franco, Esq., Principal at Franco Signor, LLC, Seeing the Forest Through the Trees: MSA/LMSA Trends by Rafael Gonzalez, Director of Medicare Compliance & Post Settlement Administration at Gould & Lamb, LLC, Celia Mendez, Esq., Mediator & Attorney at Moreland & Mendez, P.A., and Cynthia Sage, Esq., Corporate Counsel at FCCI Insurance Group. The program will end with MSP Compliance in the Real World: A Roundtable Discussion where all of the previously mentioned speakers will be joined by Skip Brechtel, Chief Technical Officer at CCMSI, Wade McGuffey, Esq., of Goodman, McGuffey, Lindsey & Johnson, LLP, and the Honorable David Langham, Deputy Chief Judge of Workers’ Compensation Claims.

The program will:

  • Provide much needed technical information on Mandatory Insurer Reporting, addressing its purpose and expounding on reporting triggers, errors and challenges, as well as the consequences enumerated by Section 111 of the Medicare/Medicaid SCHIP Extension Act of 2007.
  • Present a comprehensive overview of the policies and procedures relative to the Medicare Secondary Payer Recovery Contractor (MSPRC), challenges in dealing with the MSPRC and consequences of not handling Conditional Payments appropriately.
  • Give attendees with a thorough review of new legislative initiatives and cases decided from around the country on both workers’ compensation and liability claims related to Medicare Set Asides and Conditional Payments.
  • Delve into current industry trends in workers’ compensation and liability Medicare Set- Asides, specifically regarding MSA submissions, MSA approvals, MSA pharmacy issues and MSA administration.
  • Offer those in attendance the opportunity to listen in on a roundtable discussion bringing legal and claims’ experts together to discuss their trials, tribulations, methods and best practices in complying with CMS’ policies to take Medicare’s interest into consideration when settling past and future medical care.

Recent Medicare Liability Insurance Procedures

Russell S whittle, Esq VP MSP ComplianceMedicare compliance issues in liability cases have become increasingly troublesome in recent months. Judging by the volume of questions posed at a recent 2-day educational seminar hosted by Gould & Lamb and based upon the volume of questions asked of the legal team at Gould & Lamb, and what seems a constant stream of issues continuously raised by other Medicare list serves, liability insurance and the Medicare responsibilities at settlement are getting more and more prevalent. While similar concerns exist for workers’ compensation practitioners, it would appear that liability claims handlers, attorneys, and providers are realizing that Medicare’s interests must be protected and that Medicare compliance has a real financial impact on claims.

Workers’ Compensation claims practitioners have been exposed to the Medicare world for about a dozen years. With the publishing of CMS’ “Patel Memorandum” in 2001, adjusters, attorneys, and insurance companies have adopted the Medicare Set-Aside to protect Medicare’s future interests and have incorporated Conditional Payment strategies into case handling in order to avoid Medicare’s recovery rights to past medical payments. In short, Medicare has been a typical part of the resolution of a workers’ compensation case for some time. In contrast, it appears that the liability insurance world is just beginning to discover what Medicare compliance may require.

While it is unclear whether the seemingly new focus on compliance on the liability insurance side is a result of a statutory analysis of the Medicare Secondary Payer (MSP) Act, Medicare guidance, Medicare policy, or jurisprudence, there certainly appears to be heightened awareness of the potential downside of failure to comply given the virtually unlimited reach of the federal government and the MSP Act itself. Perhaps, the increased focus on MSP concerns is related to Medicare’s most recent activity and guidance regarding Conditional Payment recovery and Mandatory Insurer Reporting?

Conditional Payment Recovery Options

Beginning in September of 2011 and thereafter, Medicare, through the Medicare Secondary Payer Recovery Contractor (MSPRC) and within the Mandatory Insurer Reporting structure itself, has begun to publish policy specifically designed to handle liability insurance issues. Gone are the days (and, presumably, the arguments) that Medicare compliance applies only to Workers’ Compensation cases. With regard to Conditional Payments, the MSPRC has established protocols to assist litigants with the lien repayment process in liability claims. In cases that settle for $300 or less, Medicare may consider a waiver of any lien.  In cases that settle for $5000 or less, a fixed percentage may be acceptable to Medicare if certain criteria is met. In cases that settle for $25,000 or less, the parties can self calculate the lien recovery and Medicare will then consider, and perhaps approve, the amount . Significantly, CMS published its first Memorandum specifically directed at Medicare’s future interests in a liability case and how best to protect Medicare’s interests. In the Mandatory Insurer Reporting arena, Medicare has announced that they will utilize the Taxpayer Identification Number provided during data entry to generate lien recovery activity as against specific Responsible Reporting Entities.

Accordingly, virtually all of Medicare’s activity over the last six months has been directed at liability claims and how to account for them in their processes and procedures. Clearly, Medicare recognizes that liability settlements have the potential to bolster the flagging finances of the Medicare system and is beginning to utilize the information provided to them to that end. As the year progresses, we expect more and more guidance regarding the protection of Medicare’s interests in settlements that address the future medical needs of injured parties. Until then, Medicare has begun the process of putting together a methodology for liability cases as opposed to Workers’ Compensation cases which, by the looks of things, has resulted in significant activity amongst liability practitioners.

Click Here to Download the MSP Compliance Protocols User Guide from Gould and Lamb

Download the MSP Compliance Protocols user guide today!


About the Author: Russell S. Whittle, Esq., is the Vice President of MSP Compliance for Gould & Lamb, LLC. In his twenty plus years of practice prior to joining Gould & Lamb, LLC, Mr. Whittle practiced primarily in the area of insurance defense, representing the interests of large insurers and employers in both workers’ compensation and general automobile liability matters.

Gould & Lamb is a global leader of MSA/MSP Compliance Services in the country, serving domestic and international insurance companies, third-party administrators and self-insured entities.

MMSEA Section 111 Reporting – How the Pieces Fit Together

John MianoWhen a Responsible Reporting Entity (RRE) submits records for the quarterly claim report to CMS and these records are accepted, where does the data go?  How is it utilized and what potential issues may arise? One assumes that there is a single system or database for this information.  In fact, there are multiple systems involved.

Records submitted and accepted where on-going responsibility for medical (ORM) was assumed results in creation of the injured party’s Common Working File in the Coordination of Benefits Contractor’s (COBC) database. The ICD-9 coding passed in the claim record establishes those medical conditions for which the RRE has authorized or approved on-going medical care or treatment.

Records submitted and accepted that report the event of a Total Payment Obligation to the Claimant (TPOC) indicate the occurrence of a settlement, judgment, award or other payment (intended to resolve or partially resolve a claim). The ICD-9 coding passed in the claim record establishes those conditions claimed and/or released. This TPOC data is passed by COBC directly to an external database with the Medicare Secondary Payer Recovery Contractor (MSPRC).

MSPRC’s Role

The COBC provides notification to MSPRC of the injured party and accident information per the Common Working file within 48 hours. The MSPRC issues a ‘Rights and Responsibilities’ letter to the RRE and injured party within 45 days, notifying of CMS’ rights of recovery regarding its conditional payment lien (CPL). When MSPRC is notified of a TPOC, a demand letter is issued. Following the final demand from MSPRC, should full repayment not be received within 60 days, interest begins to accrue and an ‘Intent to Refer’ letter is issued. If repayment is not resolved within 120 days of the final demand, the unresolved debt is referred to the Department of Treasury for litigation.

Potential Issues

Litigation

Should the injured party not repay the CPL within 120 days post issuance of the final demand letter, the Department of Treasury is empowered to recover double damages, interest and attorney fees.  Per 42 USC 1395 (y)(b)(2)(B) the Federal Government may bring an action against any responsible party, including the RRE.

Disruption of Benefits

Medicare Beneficiaries may contact the RRE or Claims Administrator advising of disruption of benefits.

This disruption may be due to improper ICD-9 coding (too general or incorrect conditions identified). In this scenario, contact with the RRE’s EDI Representative may aide in correction until the RRE’s next quarterly claim input file may be submitted containing the correct ICD-9 coding in an updated record.

Another cause for disruption may be assumption of ORM; COBC may advise the beneficiary that the RRE must close their claim by terminating ORM. This may be accomplished via telephone contact with COBC and subsequent reporting of the ORM Termination Date in the RRE’s next quarterly claim input file submission.   Extreme caution should be exercised to ensure that ORM has truly ended prior to engaging COBC.

Lastly, human error, lack of communication and/or training may result in disruption. Medical providers or the COBC may misinterpret ICD-9 coding or lack appropriate communication and/or training to recognize which medical conditions the RRE had assumed ORM for and/or released pursuant to TPOC.  In this scenario, the RRE or Claim Administrator may only offer the beneficiary the remedy of appealing these denials via the established process with COBC.

Conclusion

MMSEA Section 111 Reporting involves many subsystems and external databases with other government entities and contractors. Data quality, communication and training are critical at all levels to ensure timely reporting and accurate delivery of benefits to the injured party / beneficiary.

Gould & Lamb continues to work with CMS in exchanging quality data and resolution of industry challenges, such as injured party benefit disruption. As the COBC and MSPRC are now the responsibility of the same contractor, there is reason to be optimistic regarding improved processes and performance.


About the Author: John Miano is the Manager of Reporting Services for Gould & Lamb, LLC. His primary responsibility is directing the implementation of CMS Section 111 reporting programs for our clients. He has over 20 years experience in the Property and Casualty Insurance Industry and is currently an active committee member of the International Association of Industrial Accident Board Committees (IAIABC). He is also a former Executive Board Member of the Association of Workers Compensation Claim Professionals (WCCP) and is a Board Certified Workers Compensation claim adjuster (CWC).

Gould & Lamb is a global leader of MSA/MSP Compliance Services in the country, serving domestic and international insurance companies, third-party administrators and self-insured entities.

Changes at CMS May Signal Different Approach

Russell S whittle, Esq VP MSP ComplianceLeadership Change at CMS

Don Berwick, the Harvard professor who was tapped by the Obama administration to lead the overhaul of the massive Medicare and Medicaid programs, resigned just months before he was scheduled to leave his post. On November 29, Marilyn Tavenner, a former health official from Virginia, was installed by the administration to head the Centers for Medicare and Medicaid Services (CMS).

The change in leadership comes amid a very interesting series of events that, some would argue, signaled a more reasonable and responsible approach to Medicare’s recovery rights and activity.

Change in Conditional Payment Procedure

CMS recently made changes to the process and procedure of conditional payment recovery in liability cases. As has been widely reported, the Medicare Secondary Payer Recovery Contractor (MSPRC) published on their website an Alert.  The Alert advised that starting September 6, 2011, in the case of a lump sum settlement of $300 or less, Medicare may not recover from that settlement, based on certain criteria. If the beneficiary’s settlement, judgment, award or other payment is related to an alleged physical trauma-based incident, the liability insurance (including self-insurance) settlement, judgment, award, or other payment is $300 or less, the beneficiary has not received and does not expect to receive any other settlements, judgments, awards, or other payments related to the incident and Medicare has not previously issued a recovery demand letter, recovery will not be pursued.

Also, the MSPRC has implemented a new and “simple” fixed percentage recovery option that is available to certain beneficiaries effective November 7, 2011. The Fixed Percentage Option gives beneficiaries who have physical trauma-based Liability insurance (including self-insurance) settlements of $5,000 or less the ability to resolve Medicare’s recovery claim by paying Medicare 25% of the total liability insurance settlement instead of using the current recovery process.

CMS Philosophy Change?

These procedural changes were made in the face of H.R. 1063, the “SMART” Act, followed by the Senate version of the Bill, S. 1718. While the Bill is multi-faceted, it includes a provision requiring CMS to ensure that the government does not spend more money pursuing a Medicare Secondary Payer (MSP) recovery claim than it will actually recover from that claim. A threshold would be set (annually by the CMS Actuary) at the amount of settlement likely to yield a MSP collection at or below the government’s recovery cost. Thus, the recent changes seem to suggest that CMS has determined that recoveries on settlements of less than $300 are not cost effective, nor is negotiating lien recovery on nuisance value settlements. It can be argued that CMS has begun the process of institutional reform that considers the realities of tort litigation while under Dr. Berwick’s leadership. While the efforts seem trivial in the short term, there appears to be evidence that the conditional payment process, at least, was being revamped without the need for legislation. How the change in leadership will effect the process is anyone’s guess. HPreview Changesowever, we may be on the precipice of institutional and philosophical changes at CMS that may make further legislative attempts at change unnecessary.

Click Here to Download the MSP Compliance Protocols User Guide from Gould and Lamb
Download Gould and Lamb’s Medicare Secondary Payer Compliance and Protocols User Guide

Download the MSP Compliance Protocols user guide today!


About the Author: Russell S. Whittle, Esq., is the Vice President of MSP Compliance for Gould & Lamb, LLC. In his twenty plus years of practice prior to joining Gould & Lamb, LLC, Mr. Whittle practiced primarily in the area of insurance defense, representing the interests of large insurers and employers in both workers’ compensation and general automobile liability matters.

New Fixed Percentage Option for Conditional Payment Resolution

Christie Luke Vice President Operations

As expected, on November 7th, the Centers for Medicare & Medicaid Services (CMS) implemented a new fixed percentage option for Conditional Payment Resolution (CPR).  The new fixed percentage option makes the process simpler and faster.  Any beneficiary who meets the criteria below can resolve Medicare’s Conditional Payment recovery claim by paying a flat 25% of his/her total liability insurance settlement.

Required Criteria

In order to qualify, all of the following criteria must be met:

  1. The liability insurance settlement must be for a physical trauma based injury, and
  2. The total liability settlement, judgment, award, or other payment is $5,000 or less, and
  3. The beneficiary elects the option within the required time frame
  4. Medicare has not issued a demand letter or other request for reimbursement related to the incident, and
  5. The beneficiary has not received and does not expect to receive any other settlements, judgments, awards, or other payments related to the incident.

When to Exercise the Option

There are some guidelines as to when to exercise the option:

  1. The request must be submitted before or at the time the settlement documentation is submitted.
  2. If a Conditional Payment Notice (CPN) has been issued, the request must be on or before the CPN response is due (30 days from the date of the CPN).

In order to elect this option, documentation must be completed by the beneficiary or his representative, and mailed to the MSPRC.  Requests are processed in the order received.  So, it is imperative that when selecting this alternative the request is submitted timely.

If the request is denied, a formal letter will be provided with an explanation, and a regular Demand will be sent under separate cover.  If approved, the beneficiary will receive a bill for the amount specified (i.e. 25% of the settlement).

Wait & See

As indicated in our previous Industry News Bulletin of October 26th, the new procedure is a seemingly good way to speed up the process on ‘smaller’ Liability settlements.  However just how many claims will meet this criteria is yet to be determined.


About the Author: Christie Britt is the Vice President of Operations overseeing the extensive operations of Gould & Lamb.   She has vast knowledge of Medicare Set Asides and Post-Settlement Administration from an insurance claims perspective. Christie is MSCC certified and has her Green Belt Certification in Six Sigma.  She is also a member of the National Association of Medicare Set Aside Professionals (NAMSAP) and the Workers’ Compensation Claims Professionals (WCCP).

Gould & Lamb is a global leader of MSA/MSP Compliance Services in the country, serving domestic and international insurance companies, third-party administrators and self-insured entities.