Considering Medicare's interests in a workers' compensation claim involves two elements: payment of past medical expenses and payment of future medical expenses.
Past medical payments made by Medicare for treatment related to the work injury and payable by the carrier are called "conditional payments" and must be reimbursed to Medicare. Medicare's procedures for identifying and seeking reimbursement of conditional payments have changed over the years but the basic principal that Medicare must be made aware of a work injury involving a beneficiary remains. The implementation of the Section111 reporting requirements with use of responsible reporting entities has streamlined the process and is intended to allow for up to date conditional payment information for reported cases. However, there are still some cases that do not meet the reporting thresholds for Section 111 purposes prior to settlement. In those cases, the parties can still make the initial report of injury via the Medicare Coordination of Benefits and Recovery Contractor telephone system.
In addition to the traditional conditional payment inquiry via Medicare, the parties must also consider whether the employee has a Medicare Advantage plan through a private health insurer that may have paid for treatment related to the work injury. Because the payment is made by a private health insurer rather than Medicare, any such payments would not appear in the conditional payment lien search performed by Medicare. If the employee does have a Medicare Advantage plan, the parties must ascertain if that plan has paid for any treatment related to the work injury and address any lien asserted by the plan.
And now we get to the Medicare Set-Aside. Separate and apart from past medical payments, the parties must also provide for payment of future treatment related to the work injury regardless of whether the employee is a Medicare beneficiary at the time of settlement. While Medicare has set thresholds for when it will review a Set-Aside trust arrangement, its mere workload thresholds and do not eliminate the need for Set-Asides in cases that do not meet the thresholds.
In any situation where it is anticipated that the employee will require additional treatment related to the work injury, the parties should put aside a portion of the settlement for purposes of paying for that treatment, even if Medicare will not review a proposed Set-Aside. In cases where the review thresholds are met review by Medicare remains voluntary, however, it is considered a best practice to obtain Medicare review and approval of a Set-Aside when available.
For more information please contact Renee Porada Frazier at rporada@wglaw.com or 412.281.4573.
Disclaimer: The contents of this post are for informational purposes only, are not legal advice and do not create an attorney-client relationship.