Medicare Alerts: New Regulations for Section 111 Reporting and Set-Aside Reviews

Section 111 Reporting of Set-Aside Amounts in Settlements

Medicare now requires that all settlements reported on or after April 4, 2025 include a set-aide amount if:

• The settlement involves a Medicare beneficiary;
• The settlement resolves future medical; and
• The settlement exceeds $750.00 (the current reporting threshold)

The set-aside amount reported can be $0.00.

While this does place an increased burden on the Responsible Reporting Entity (RRE) who make the reports to Medicare, it is also a good reminder that in all cases, even those that do not meet Medicare’s review threshold, the parties have an obligation to consider Medicare’s interests. Regardless of the amount of the set aside, the file should be documented as to the basis for that amount. As an example, if the set aside is zero you would want to document if the treating physician has documented that no further treatment is needed.

Medicare Review of Set-Asides

Amended Review of a set-aside determination will be available at any time after approval effective April 7, 2025.

This is a change from the current policy that does not permit amended review until 1 year after the WCMSA case was approved.

Zero Dollar Set-Asides will no longer be accepted or reviewed by CMS effective July 17, 2025.

This actually represents a return to Medicare’s original review policy, and it provides a good opportunity to review when a zero-dollar set-aside would be appropriate.

Per Section 4.2 of the WCMSA Reference Guide, Version 4.2, A WCMSA is not necessary under the following conditions, because when true, they indicate that Medicare’s interests are already protected:

• The Facts of the case demonstrate the injured individual is only being compensated for past medical expenses; and
• There is no evidence that the individual is attempting to maximize other aspects of the settlement to Medicare’ Detriment.

The above conditions may be demonstrated in the following circumstances:

• The treating physician’s medical records documents to a “reasonable degree of medical certainty” that the claimant no longer requires treatment or medication related to the work injury which is being settled
• This is a denied claim in which no medical or indemnity payments have been made prior to the settlement; medical and indemnity benefits are not actively being paid; and the settlement agreement does not allocate certain amounts for specific future medical expenses
• There is a decision on the merits that the employer/insurer =no longer owes medial or indemnity benefits, medical and indemnity benefits are not actively being paid and the settlement agreement does not allocate certain amounts for specific future medical services
• This is a denied claim and the only benefits were paid within the statutory timeframe allowed to pay without prejudice during the investigation period, benefits are not being actively paid that settlement does not allocate certain amounts for specific future medical services
• The settlement does not resolve the medical portion of the claim and the WC carrier remains responsible for ongoing medical and prescription costs once the settlement funds are fully spent