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Medicare Secondary Payer Statute

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Medicare Secondary Payer Statute Powered By Docstoc
					  Medicare Compliance Overview


           Jessica C. Smythe, Esq.
     Crowe Paradis Services Corporation

             Dave Peterson, Esq.
Jones Funderburg Sessums Peterson & Lee, PLLC

              Bryan G. Bridges
             Markow Walker, PA
Medicare Secondary Payer Statute (MSP)
    What is the Medicare Secondary Payer Statute?

    Collection of statutory provisions
         Created by the Omnibus Reconciliation Act of 1980
         Enacted by Congress in 1981
         Has undergone a series of amendments
          (i.e., 1982, 1984, 1985, 1986, 1989, 2003 & 2007)

    Congress enacted the MSP in order to reduce spending and
     preserve the fiscal integrity of the Medicare program

    The basic premise is that Medicare will be the secondary
     rather than primary payer under certain conditions and we
     can’t shift the burden of medical care in those situations to
     the Medicare program.
MSP Compliance requires three major
focuses

   Conditional Payments –
       Reimbursement for past payments


   Medicare Set Asides-
       Allocation of Money for future treatment

   Reporting pursuant to MMSEA–
       The Treasure Map
Remember: Medicare Eligibility
   Age 65 years or more
   SSDI for 24 months ***
   End Stage Renal Disease (kidney failure)

***Social Security Disability Insurance
   Entitlement is retroactive
   Lengthy multi-stage appeals process
   Moving target for Medicare eligibility
                                               MSP
                                               Background
MSP Compliance-Conditional
Payments: Paying for the Past
What is a Conditional Payment?

   Payments made by Medicare under the condition that
    the primary plan will repay Medicare once it is
    demonstrated the primary plan is responsible for the
    payments (42 U.S.C. 1395y (b)(2)(B)(ii) )

   Allows beneficiary to receive medical treatment when
    no other insurance is available

   Allows medical care providers to get paid
                                                           MSP
                                                           Background



                                                              6
Right of Recovery by Medicare for
Conditional Payments
   Medicare can bring an action for double damages against
    any and all entities responsible for payment under the
    primary plan


   Medicare must be repaid within 60 days of final demand
    letter regardless of whether the amount is disputed or is
    being appealed or interest begins to accrue (Haro v.
    Sebelius)


   Enforcement is through the Department of Treasury           MSP
                                                                Background



                                                                   7
What should I do?
   Need to establish Medicare eligibility status on
    every settlement – no dollar threshold – (HINT –
    S 111).

       SSDI / Medicare Check
       Incorporate into discovery
       Key is SSDI not Age


   If you discover Medicare eligibility status, then
    have your MSA provider or internally investigate
    any conditional payments, verify, and negotiate
Negotiate
   Don’t Just Pay the Asserted Amount:

       Claim paid was not related to the injury being settled

       Duplicate payment

       Care was provided by an unauthorized provider and
        appropriate care was being provided
U.S. v. Stricker, U.S. District Court,
N.D. Alabama (filed December 1,
2009)
Complaint filed by Medicare against major insurance
  carriers, insureds and plaintiffs’ attorneys arising
  out of a 2003 class action lawsuit

Out of the 20,000 class action plaintiffs, 907 were
  Medicare beneficiaries; claim ultimately settled
  for $300 million

Medicare made conditional payments in the claim
  that were not reimbursed upon settlement
Medicare’s Theory of Recovery

   Carriers made payments under product liability
    policies

   Defendants knew or should have known that
    conditional Medicare payments have been made

   Defendants allegedly did not check prior to
    distribution of settlement for the existence of
    conditional payments
U.S. v. Stricker: Updated Procedural
History
   Suit filed December 1, 2009

   Medicare filed Partial Summary Judgment based
    upon payment of settlement and failure to
    reimburse CPs and defendants filed Motions to
    Dismiss based upon SOL

   Medicare’s Motion was denied September 30,
    2010 and defendants’ Motion to Dismiss was
    granted
United States v. Stricker: Updated
Procedural History
   Defendants’ Motion to Dismiss granted based on
    judge’s determination of the correct SOL (3 years v. 6
    years since the underlying action is based upon a tort
    claim, not contract)

   Judge determined the statute of limitation accrued
    from the date the settlement was approved by the
    court, September 10, 2003

   Medicare argued that the statute continued to accrue
    when yearly payments were made by defendants
    (pursuant to the terms of settlement, defendants
    were to make payments until 2013)
United States v. Stricker: Updated
Procedural History
   On October 29, 2010, Medicare filed a Motion to
    Reconsider the decision dismissing Medicare’s
    claim
   On November 2, 2010, Judge Bowdre, the judge
    who earlier dismissed Medicare’s claim, granted
    the motion for reconsideration on the grounds
    that Medicare should be allowed to argue the
    theory of continuing accrual and tolling with
    respect to the statute of limitation
   Briefs are due to the court on this issue
    November 16, 2010
MSP Compliance – Medicare Set Asides:
Forecasting the Future
Two types of claims require an MSA
with submission to CMS for approval
Class I
   The petitioner is a Medicare recipient at the time
    of settlement and the workers’ compensation
    settlement is $25,000 or greater
           Settlement amount includes, but is not limited to wages,
            attorney fees, all future medical expenses, repayment of
            any conditional payments, and any previously settled
            portion of the WC claim. July 11, 2005.
Class II
   The petitioner has a “reasonable expectation” of
    becoming a Medicare beneficiary within 30
    months of the date of settlement and the
    settlement is $250,000 or greater
           Settlement amount includes, but is not limited to wages,
            attorney fees, all future medical expenses, repayment of
            any conditional payments, and any previously settled
            portion of the WC claim. July 11, 2005.
Class III
   Problem:

        CMS has stated that these (Class I AND Class II) are only
         “workload review thresholds.”
        CMS has also stated that parties must “consider and protect
         Medicare’s interests when settling any workers’ compensation
         case (Class III); even if review thresholds are not met,
         Medicare’s interest must always be considered.”

   Solution:

        Review each file with a uniform approach at compliance
             Medicare Status, Lost Time, Return to Work, Age, Medical
              reserves, Dollar Amount, Type of Settlement
                   CPSC Score Sheet – Spectrum Analysis
MSP Compliance- Section 111 of the
Medicare, Medicaid and SCHIP Extension
Act of 2007
   The Treasure Map!
MMSEA
   Medicare, Medicaid & SCHIP Extension Act of
    2007 (MMSEA)
       Section 111 of the MMSEA adds new reporting
        requirements for liability (including self insurance), no
        fault, and workers compensation claims at 42 U.S.C.
        1395y(b)(8).
       The entities responsible for complying are referred to as
        Responsible Reporting Entities (RRE).
       Information is available on the CMS website:
            www.cms.hhs.gov/MandatoryInsRep
       The purpose of Section 111 is to ensure proper
        coordination of benefits between Group Health Plans,
        Non-Group Health plans and Medicare.
Reportable Events: ORM and TPOC
   ORM claims are claims where the RRE has
    accepted ongoing responsibility for medical
    benefits

   The RRE must also report when ORM is
    terminated

   ORM is associated with workers compensation
    and no fault liability plans of insurance
Reportable Events: ORM and TPOC
   TPOC events are settlements, judgments, awards
    or other payments separate from/in addition to
    ORM events

   The RRE is satisfying its “total payment obligation
    to the claimant”
New Section 111 Reporting Deadlines
   On November 9, 2010, CMS issued an alert changing
    the reporting deadlines with respect to liability claims

   Previous deadline was that all TPOCs after October 1,
    2010, were to be reported to CMS beginning January
    1, 2011

   Now, TPOCs occurring after October 1, 2011, are to
    be reported beginning January 1, 2012


   But alert says early reporting is “welcome and
    encouraged”
Reporting Deadlines for ORM and
Workers Compensation Claims
   November 9, 2010 CMS Alert does not change
    deadlines for ORM claims, including workers
    compensation and no fault insurance claims

   ORM claims in existence as of January 1, 2010,
    must be reported to CMS beginning January 1,
    2011

   CMS Alert also extended reporting thresholds
Reporting Thresholds
   TPOC events prior to January 1, 2013 with TPOC
    amounts totaling $0-$5,000 are exempt from
    reporting

   TPOC events dating January 1, 2013-December 31,
    2013 with TPOC amounts totaling $0-$2000 are
    exempt from reporting

   TPOC events dating January 1, 2014-December 31,
    2014 with TPOC amounts totaling $0-$600 are
    exempt from reporting

   All TPOCs after January 1, 2015 are reported
    regardless of amount
MMSEA-Section 111
   Threshold for ORM Reporting:
       Only applies to Worker’s Comp claims
       Have to meet all of the following criteria:
            Medicals only;
            Lost time of no more than 7 calendar days;
            All payments have been made directly to the medical
             provider; and
            Total payment does not exceed $750



                                                                   MIR,
                                                                   MMSEA &
                                                                   Section 111


                                                                     26
Thank You

Jessica C. Smythe, Esq.
Crowe Paradis Services Corporation
400 Riverpark Drive Ste 400
North Reading, MA 01864
T (866) 630-CPSC
F (978) 825-8308
www.CPSCmsa.com

Bryan G. Bridges
Markow Walker, PA
599 Highland Colony Parkway, Ste 100
Ridgeland, MS 39157
Tel. 601.853.1911
Fax 601.853.8284

Dave Peterson
Jones Funderburg Sessums Peterson & Lee, PLLC
Post Office Box 13960
Jackson, MS 39236-3960
Telephone No.: 601-355-5200
Facsimile No.: 601-355-5400

				
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