By Daniel M. Anders, Esq., Chief Compliance Officer, Tower MSA Partners
The concept of not submitting a Medicare Set-Aside (MSA) for approval from the Centers for Medicare and Medicaid Services has become an increasingly popular topic in workers’ compensation. Since the MSA review process is voluntary, “non-submit” is an option for settling parties in workers’ compensation cases. And, depending upon the circumstances of a particular workers’ compensation claim and the positions of the settling parties, a non-submit MSA may be reasonable and appropriate.
However, the MSA submission route is preferred in many cases, so it is important that among these calls for non-submission that we still say it’s OK to submit an MSA to CMS.
MSAs fund an injured worker’s future medical care for years and even decades to come. If the use of these funds is reported and the injured worker properly exhausts the allocated amount, Medicare will pay future injury related medical costs.
When making the submit/non-submit decisions, settling parties need to consider that submitting MSAs to CMS reduces risk. An approved MSA eliminates the risk to the injured worker of CMS denying payment for injury-related medical care after the MSA is properly exhausted and the risk to the payer of a CMS reimbursement claim for post-settlement medicals.
Some non-submit proponents contend that the lack of extensive denials of medical care or post-settlement reimbursement claims by CMS argues in favor of avoiding the MSA submission process. These may be valid considerations.
However, in the 18 years of CMS’s stepped-up efforts at Medicare Secondary Payer (MSP) enforcement, starting with the MSA review process in 2001, we have seen an ever-increasing level of enforcement. Noteworthy examples are the Section 111 Mandatory Insurer reporting process, the introduction of the Benefits Coordination and Recovery Center (BCRC) and Commercial Repayment Center (CRC) contractors to recover conditional payments and, the Workers Compensation Review contractor to centralize the MSA review process. Now, CMS appears to be considering a similar review process for liability claims.
Proponents of non-submit argue that CMS-submitted MSAs take too long to settle and are more expensive. Yet, submitting MSAs for CMS approval does not need to be a lengthy process. In 2018, 16 days was the average turnaround time for CMS approval when no Development Letter (CMS request for additional information or documentation) was generated. Even when a re-review request (appeal) was submitted to CMS, it only added 16 days to the turnaround time.
Key to receiving that quick turnaround time is to provide CMS with updated medical records and clear documentation on the need or lack thereof for future medical care. Proactively obtaining statements from treating physicians and claimants prior to MSA submission typically clarifies matters. Often this clarification leads to reductions in the MSA amount and it certainly ensures a quick turnaround time for CMS MSA approval.
A submitted MSA may yield a higher MSA allocation than a non-submitted MSA. CMS sets the bar high as its goal is to avoid the potential for shifting injury-related costs to Medicare. The flip-side though is a non-submit MSA can set the bar too low. In other words, without CMS approval there can be a race to the bottom to find any argument, reasonable or not, to remove medical care from the MSA. These quick “cost-savings” may have adverse consequences for both payer and injured worker if CMS later finds this allocation to be insufficient and the risks laid out above become a reality for payer and/or injured worker.
How then can one obtain CMS approval of the MSA and still contain costs? First, do not allocate one dollar more than CMS will require. This is accomplished by reconciling every CMS MSA determination against CMS’s own review guidelines and clinical references. When CMS is wrong, challenge them. If CMs is correct, then learn from them so that over time the methodology CMS uses to allocate MSAs becomes predictable.
Second, MSA predictability allows identification of the documentation/evidence CMS requires in order to approve changes in medical treatment and drug therapy. This is obtained upfront and submitted with the MSA, resulting in cost containment and quick CMS MSA approval.
Additionally, it is important to understand that not every CMS-approved MSA is over $100,000 and includes a laundry list of medications. Tower’s data from 2018 point to a much different reality:
- A median CMS-approved MSA was $31,311;
- MSAs with prescription drugs continue to decline – from 43% in 2017 to 34% in 2018;
- MSAs with opioids continue to decline as well – from 27% in 2017 to 11% in 2018.
In short, MSA costs can be mitigated, and as this data shows, reduced over time.
CMS MSP enforcement is not receding; if anything, it’s increasing. The MSA approval process allows parties to obviate the risk of shifting future injury-related medical care to Medicare by obtaining a stamp of approval. And keep in mind, this is a risk that lasts the injured worker’s lifetime if CMS approval of the MSA is not obtained. Consequently, the CMS MSA submission process remains an appropriate option for both the payers and injured workers at time of settlement.
About Dan Anders
Dan Anders is an expert in Medicare Secondary Payer (MSP) compliance and Medicare Set-Aside (MSA) preparation. As Chief Compliance Officer for Tower MSA Partners, Mr. Anders oversees all aspects of regulatory compliance associated with the MSP status and local, state and federal laws. His responsibilities include ensuring the integrity and quality of Tower’s other services and products, including its MSA program.
With more than 15 years of experience in working with employers, insurers, third-party administrators, attorneys and claimants, Mr. Anders provides education and consultation to Tower’s clients on all aspects of MSP compliance. He has presented at industry conferences, including the National Workers’ Compensation & Disability Conference & Expo, and written a number of articles and blog posts on MSAs and compliance issues. He is a subject matter expert in this area and has been interviewed and has written articles for insurance/workers’ compensation. He frequently contributes to Tower’s MSP Compliance blog.
An attorney and certified Medicare Set-Aside Consultant, Mr. Anders joined Tower in 2016. He previously served as Senior Vice President of MSP Compliance for ExamWorks Clinical Solutions and he has extensive litigation experience from his earlier position with the Chicago law firm of Wiedner & McAuliffe.
He is a member of the Illinois State Bar Association and the National Alliance of Medicare Set-Aside Professionals (NAMSAP), where he serves on its executive committee as treasurer for 2019 and co-chairs the organization’s Policy and Legislative Committee. Anders earned his Juris Doctor degree from Chicago-Kent College of Law and his bachelor’s degree from Loyola University Chicago.