By Martin Cassavoy, VP of Policy for ISO Claims Partners, a Verisk Analytics business
This summer, the Centers for Medicare & Medicaid Services (CMS) announced a change in the way workers compensation will be recovered from insurers in the future. The change will likely affect handling of workers compensation claims around the country — even in places that typically have avoided Medicare’s probing eye. What do you need to know about these important changes? What’s about to happen?
For the last decade, Medicare has used one federal contractor to seek reimbursement from workers compensation insurers whenever Medicare makes a payment that it believes those insurers should have made. In July, CMS announced that it was dividing those duties between two contractors. The Benefits Coordination and Recovery Center (BCRC) will remain in place and focus solely on recovering from Medicare beneficiaries. Another contractor, the Commercial Repayment Center (CRC), will issue demands when the identified debtor is an insurer or self-insured — a change that’s critical for workers compensation insurers.
The CRC has been recovering from group health insurers since 2013 and will now pivot to recover whenever an insurer is the primary debtor. In conjunction with this new workflow, Medicare also announced a change in the way the CRC recovers from insurers. The CRC will perform recoveries before settlement or even when no settlement is anticipated. Section 111 mandatory insurer reporting requires workers compensation claim payers to notify Medicare whenever there’s an “ongoing responsibility” to pay for work-related medical benefits. Now, the CRC will simply recover from insurers whenever ORM (Ongoing Responsibility for Medicals) exists with a Medicare beneficiary.
Medicare issues Conditional Payment Notifications (CPNs) whenever it believes conditional payments have been made on a claim, even though Medicare is aware that the case has already settled. A CPN allows the recipient 30 days responding to the notice. At the end of 30 days, and if no response has been received, the notice converts to a final demand. The CRC will now use this mechanism to seek recovery before settlement.
Basically, once a workers comp claim payer reports responsibility for payments, Medicare’s contractor will send a 30-day collection notice if the claimant has a portion of the injury-related treatment paid by Medicare. For those entities not accustomed to receiving CPNs or notifications, this could be eye-opening.
What should a workers compensation claim payer do now?
- Know the issue: When folks in workers compensation hear Medicare, they usually think of Medicare Set-Asides (MSAs). MSAs are something to consider when a settlement involves a Medicare beneficiary. But conditional payments can happen whenever a claim involves a Medicare beneficiary — regardless of settlement. So be on the lookout for possible conditional payments.
- Be timely and accurate: The data sent to Medicare is going to be used to create a recovery demand. Be sure the information you send is accurate, since it will be the basis of a request for repayment.
- Act quickly: Thirty days is not much time to respond to a potential reimbursement claim from the federal government. Be ready to react to any letters that arrive.
- Be aggressive: Our data suggests that many claims in Conditional Payment Letters (CPLs) may be included by mistake. If you don’t believe you’re the responsible primary payer, let Medicare’s contractor know about it.
- Use comprehensive and integrated technology: Data is on your side. You know what was sent to Medicare before the CRC issues a CPN. Act accordingly, and anticipate which claims could result in a reimbursement claim. Be sure to ask Medicare’s contractor whether any claims have been made on a CPN before the clock starts ticking.
Source: ISO Claims Partners