3 TPOC Truths on CMS Mandatory Insurer Reporting

I shared a passionate article John Miano, our Manager of Reporting Services wrote recently about the upcoming CMS Mandatory Insurer Reporting due to take effect January 1, 2011. John understands the importance and inherent ramifications our clients will face if they are not properly prepared when Mandatory Insurer Reporting takes place. In this article, John offers astute insights and answers questions many of you have asked.

Written by John Miano, Manager of Reporting Services, Gould and Lamb

As we approach the Mandatory Insurer Reporting mandate of January 1, 2011, serious questions remain as to issues such as the identity of the Responsible Reporting Entity (RRE) and who must report a Total Payment Obligation to the claimant or TPOC (settlement, judgment award or other payment).

By now, most in the industry know the basics; RRE’s are required to report claims where ongoing responsibility for medical benefits (ORM) exists as of January 1, 2010 and are subsequently required to report  TPOC amounts when the TPOC settlement date is October 1, 2010 or later.

In the latest version of their User Guide, CMS provides guidance:

Section 7.1 – Who Must Report, explicitly defines the differences between Deductible versus self insured retention (SIR) programs and identifies issues specific to Deductible versus Re-Insurance, Stop Loss, Excess and Umbrella Insurance programs. Sections 11.4 and 11.5 clearly specifies TPOC Interim Reporting Thresholds and reporting of multiple TPOC’s.

Questions amongst insurers, however, have deepened as to who must report and the TPOC amount each RRE must report.

CMS TPOC Definition Overrules Insurer Description

If it walks and quacks like a duck, it’s a duck regardless of how it is perceived by the industry. In determining who the RRE may be, keep it simple; CMS acknowledges that their definitions differ from those utilized by the industry. Instruments of insurance are often identified by different names dependent on company or jurisdiction.

Example – A program behaves similar to reinsurance but has other customer specific components. The most general definition and intent should be applied when referring to CMS definitions. guidelines for the applicable plan per the NGHP User Guide should be applied.

With One Exception, RRE’s MUST REPORT TPOC Amounts

Each RRE must report those TPOC amounts (assigned or proportionate share) for which they are responsible.

The only notable exception is in regard to Liability Claims in jurisdictions which specify joint and several liability. Each RRE must report the total amount of the TPOC and not the assigned or proportionate share.

When In Reporting Doubt: CMS Is King

The only expert regarding Mandatory Insurer Reporting (MIR) is CMS. Should you have unresolved questions affecting timely compliance, CMS is the only true expert to be utilized. Any other opinion from a third party or legal counsel is just that, an opinion or interpretation.

The best place to start is with the Coordination of Benefits Contractor (COBC) Electronic Data Interchange (EDI) Representative assigned to the RRE. If you are unsure as to the identity of the EDI Representative, contact the COBC EDI Department at 646-458-6740 and ask for assistance. Outlines in Section 18.2 of the CMS User Guide are contact protocols and escalation processes.

Gould and Lamb, LLC has successfully transmitted data via OneSource on over 1100 insurance claims. The query process has been in place since July, 2009 evidencing that G&L is prepared for the reporting process and to assist clients with their ongoing mandatory insurer reporting benefits (ORM) and TPOC obligations. While the User Guide is unclear in many respects, the above observations in conjunction with the guide itself will help to avoid confusion and ensure compliance.

Download Gould and Lamb’s Medicare Secondary Payer Compliance and Protocols User Guide

Download the MSP Compliance Protocols user guide today!

Section 111 of MMSEA Reporting Requirements

With Mandatory Insurer Reporting set to finally take effect on January 1, 2011, the insurance industry, litigants, beneficiaries and legal practitioners continue to face uncertainty regarding Medicare, Medicaid and SCHIP Extension Act (MMSEA) Section 111 Reporting Requirements.

This is particularly true in mass tort litigation. Unlike a more standard tort claim, mass tort litigation presents unique challenges from both a practical and Medicare Compliance standpoint. Clearly, the burden on the parties to comply and cooperate with the mandatory insurer reporting process impacts all facets of mass tort litigation as it does all tort litigation.

No Section 111 Resolution

Section 111 reporting issues have not, by any stretch of the imagination, been resolved with respect to standard tort claims. Despite ongoing testing and receipt of data, CMS continually reworks the technical requirements of the reporting process and periodically clarifies critical elements of the reporting obligation such as the Ongoing Responsibility for Medical Care and what insurance products may be considered “no-fault” insurance.

Some unique issues raised in mass tort claims include proper and timely identification of Medicare status of class members, uncertainty regarding a specific product or products at issue in the litigation and the use of settlement funds or trusts.

Trusts sometimes make it difficult to identify the final recipient of funds and the amount ultimately received.  Even less guidance has been provided by Centers for Medicare and Medicaid Services (CMS) regarding mass tort claims. CMS has been accepting comments and suggestions for revision of the “Product Liability” reporting fields including limiting the level of detail required and revising the term “Product Liability” itself to more accurately reflect the underlying legal issues.

We eagerly await the release of User Guide 3.1 (now anticipated in July, 2010) which, CMS promises, will clarify their policy decisions and provide practical guidance on reporting for mass tort claims. They will include information on bankruptcy and insolvency, as well.

Responsible Reporting Entity for Section 111

As the responsibility for Section 111 MMSEA reporting lies with the Responsible Reporting Entity, Gould and Lamb recommends that the parties identify and acknowledge their responsibilities under the MSP at the earliest possible time. Making certain that the parties recognize that there is no question that Medicare will pursue recovery of conditional payments (made for medical care on behalf of a beneficiary when a primary payer is responsible) and that Medicare may impose obligations on the parties for future medical costs is imperative.

Medicare has demanded a seat at the settlement table in standard tort claims and mass tort claims alike. Understanding your responsibilities under Section 111 in conjunction with keeping abreast of CMS policies and procedures is the first step towards successful resolution of mass tort cases.

For additional information and updates on Section 111, please contact Gould and Lamb.

Download Gould and Lamb’s Medicare Secondary Payer Compliance and Protocols User Guide

Download the MSP Compliance Protocols user guide today!