Be Careful What You Pay For
We know it is easier said than done; however, the payments made on a workers’ compensation claim can result in BIG money in a Medicare Set-aside, if you submit for approval and subject the claim to CMS’s review guidelines. Understanding the MSA impact and how CMS views these issues can be helpful in managing claims.
For many years, CMS has taken the position that if an employer/insurer makes a payment for treatment, even if mistakenly, it is on the hook for all future treatment related to that body part/condition. In the case of a claim involving both accepted and denied conditions, there is less consistency with the CMS review contractor in applying this “penalty.” This inconsistency is likely due to less scrutiny from the reviewer regarding the payments made on the claim.
Alternatively, when presenting a zero MSA proposal to CMS, each payment made on the claim will be thoroughly examined. If any medical or indemnity benefits have been paid, CMS will not consider the claim denied and will not approve a zero MSA on that basis. The situation we often see is initial treatment paid on a claim that is subsequently denied based on an IME or other defense. There may be significant pre-existing issues and a solid basis for denying ongoing treatment. Despite that, CMS will likely require future treatment in a Medicare Set-aside as a result of the initial treatment that was paid on the claim, unless the treating physician opines that the current condition is unrelated to the alleged work injury or a state statute compels the payment of initial injury-related treatment.
The result is a Medicare Set-aside that includes future treatment that would otherwise be denied on the claim. While we understand CMS’s perspective and the need to protect the Medicare program to the greatest extent possible, in the interest of equity and fairness, it would be nice if CMS was more discerning in its evaluations and did not apply an all or nothing attitude with its review of MSAs.
We recognize that there are many factors in play in determining whether or what to pay on a workers’ compensation claim. Employers, insurers, and TPAs have to be careful to act in good faith and follow state law requirements. In addition, computer and human errors occur despite everyone’s best efforts. Though our world revolves around Medicare, we understand that Medicare, and its hypothetical impact, may not even make the short list of considerations early on in the claims handling process; however, keeping Medicare on the radar and considering it whenever possible could result in substantial savings down the road.
We love a challenge and welcome the opportunity to assist with your claims. If initial treatment was paid prior to a denial or payments were made for a denied condition in error, there may be a creative solution that will result in a satisfactory MSA and settlement.