Upcoming Change to Fixed Percentage Option

CMS currently has an option to resolve conditional payment claims in certain liability cases with settlements of $5,000.00 or less by paying 25 percent of the settlement amount to Medicare. CMS has announced that effective October 2, 2023, the maximum settlement amount for the Fixed Percentage Option will increase to $10,000.00.

The Fixed Percentage Option is available when the criteria below are met.

1. The beneficiary’s liability insurance (including self-insurance) settlement, judgment, award or other payment is related to an alleged physical trauma- based incident and;

2. The total settlement is for $5,000 (Note this amount will be raised to $10,000, effective October 2, 2023) or less.

3. The beneficiary elects the option within the required time-frame and Medicare has not issued a demand letter or other request for reimbursement related to the incident.

4. The beneficiary has not received and does not expect to receive any other settlements, judgments, awards, or other payments related to the incident.

Information on the Fixed Percentage Option, including the new maximum settlement amount of $10,000.00, is available at https://www.cms.gov/medicare/coordination-benefits-recovery/beneficiary-services/demand-calculation-options.