Medicare Conditional Payment Notices

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Yesterday I saw more Conditional Payment Notices from Medicare in one day, than I had the entire month of April.  Conditional Payment Notices (“CPNs”) are different than Conditional Payment Letters (“CPLs”), but they should not concern you if you know how to respond.  This post will discuss what is a CPN, what do to with a CPN, and why I think we’re starting to see so many.

What is a Conditional Payment Notice?

Medicare’s Conditional Payment Notices is a sort of pre-Final Demand for the Medicare lien.  The MSPRC explains why it sent it in the very first sentence:

The Centers for Medicare & Medicaid Services (CMS) has been notified that you have received a settlement, judgment, award, or other payment related to your case for the Date of Incident listed above.

Simple, right?  The case has settled and it wasn’t you (or any plaintiff representative) who told Medicare.  The CPN does look nearly identical to a CPL, except that it shows three bolded statements that the CPL does not show:

  1. In all capital letters: “CONDITIONAL PAYMENT NOTICE” can be found near the upper-right corner of the letter.
  2. About one-third of the way down: “Current Conditional Payment Amount: $___.__.”  This subtly tells you that the MSPRC might still increase the Medicare lien.
  3. Just below the amount: “RESPONSE DUE BY: June 23, 2012.” Or always 30 days after the date on the letter.

How to Respond to the Conditional Payment Notice

So what next?  Send the MSPRC your settlement information, including:

  1. Date of Settlement;
  2. Settlement Amount;
  3. Attorney;s Fee; and,
  4. An Itemization of Case Expenses.

You should also send a dispute of payments if you find it necessary.  This will minimize the Final Demand and hopefully allow you to avoid the Appeals and Reimbursement Processes.  Regardless of what you do, the MSPRC will begin the process to generate a Final Demand the day after the listed response due date.  If you send a dispute the MSPRC will consider your arguments and potentially remove unrelated claims.  If you send your settlement information the MSPRC will apply the Statutory Procurement Formula to reduce the Final Demand by no less than 33 percent.  If you do nothing the MSPRC will send a Final Demand for the entire amount of Conditional Payments, plus any new claims it discovers to be related to the injuries (if it even knows the injuries – imagine if it doesn’t!).

Why Are We Seeing an Increase in CPNs?

Mandatory Insurer Reporting started January 1, 2012.  Cases settled for more than $100,000.00 must be reported by the defendant to Medicare.  On April 1, 2012 the threshold dropped to just $50,000.00.  This means Medicare’s agents (both CMS and the MSPRC) will find out about all PI settlements over $50,000.00.  If you want to minimize the Medicare liens you should report cases to Medicare before they settle.  Give the date of injury.  Give specific injuries so the Medicare lien is limited to just sued-for injuries.  If you don’t, you’ll get an enormous CPN with just a month to respond.

Mandatory Insurer Reporting must be working, or we wouldn’t see so many CPNs.

Please contact us for any lien resolution support or assistance.  In addition to Medicare lien resolution, we can assist you with Medicaid lien resolution, ERISA subrogation, private insurance companies’ liens, and more.

Ryan J. Weiner
Co-Founder Lien Resolution Services
www.lienresolutionusa.com
http://lienblog.wordpress.com
rweiner@lienresolutionusa.com
This Blog/Web Site is made available by the publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

Medicare’s New Rights & Responsibilities Letter

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The MSPRC took 31 days to update its now infamous Rights & Responsibilities letter.   It is now at 34 days since the last Final Demand was issued by the MSPRC and that number will continue to increase.  As always, LRS will update our Twitter account and this blog whenever we have news on the return of Final Demand letters.

The NEW Rights & Responsibilities Letter

Ready for major changes?  Good.  Because there aren’t any.  The new RAR letter includes just three noticeable changes:

  • Page One, included in the bullets introduced as, “This letter is to let you know:”
  1. “What additional information you may receive on claims Medicare paid on your behalf on or after your date of incident.”  This is new text.
  2. “How to contact us (the MSPRC).” This is new text – later information on how to contact them has not changed.
  • Page Two, under “Your Responsibilities as a Medicare Beneficiary”

3.  “Once you receive a settlement, judgment, award or other payment for your insurance or workers’ compensation claim, Medicare will determine if it has a recovery claim which must be repaid to the Medicare program.  If Medicare determines that it has a recovery claim, you will be provided with a demand letter, which will include applicable appeal and waiver or recovery rights.  Medicare will not take any collection action during the pendency of any appeal or waiver request. (The applicable law can be found at 42 U.S.C. 1395y(b)(2)(A) & (B). )”

This section previously existed with language stating “the conditional payments Medicare made on your behalf must be repaid to the Medicare program.”

This means Haro v. Sebelius is the cause for these changes to the RAR and Final Demand letters.  Conditional Payment Letters for new cases will now resume.  The only remaining portion of the freeze remains the Final Demand letters.  The changes to the RAR give us some idea of how the Final Demands will be changed as well.  The only question remains – why aren’t those changes done yet?

Finally, language has been added explaining when a Conditional Payment Notice will be issued.  As discussed in the past, the CPN is used where a Final Demand has been requested, but the 65 day time period has not passed for a Conditional Payment Letter.  Please click for more on the CPN process.

Please continue to follow lienblog.wordpress.com and twitter.com/#!/LienResolve for updates.

If you need assistance with Medicare liens, Medicaid liens, ERISA liens, or any other healthcare liens, contact LRS.  LRS can help resolve all healthcare liens.  Please contact us for more information.

 

Ryan J. Weiner
Co-Founder Lien Resolution Services
www.lienresolutionusa.com
http://lienblog.wordpress.com
Twitter: @LienResolve
rweiner@lienresolutionusa.com
This Blog/Web Site is made available by the publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

 

The MSPRC’s New Use of Conditional Payment Notices

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Medicare’s MSPRC began sending Conditional Payment Notices (“CPNs”) last year.  At that time, MSPRC representatives explained the use CPN in Town Hall Meetings.  That use has seemingly changed.

What is a CPN?  It is notice given by the MSPRC that:

  1. It is aware you have settled;
  2. It may not know the settlement amount, fees, and costs taken;
  3. If you fail to respond, the Medicare lien cannot be reduced based on settlement amount, fees, and costs; and,
  4. The conditional payments (Medicare lien) amount to X, you may dispute those charges prior to a final demand and avoid the appeals process.

The original purpose of a CPN was strictly where the MSPRC learned of a settlement without the plaintiff notifying it.  That made sense with the MMSEA going into effect – even if the Medicare mandatory reporting moratoriums continue.  More and more settlements will be reported by defendants before plaintiffs once the MMSEA takes effect.

Now, we see CPNs being issued where no Conditional Payment Letter had been issued.  If you notify the MSPRC of settlement, but have not received a Conditional Payment Letter (initial Medicare lien), you will get a CPN.  The problem with this is that it slows you further.  By issuing CPNs, the MSPRC is taking another 45 days on top of the “35 days” you should have waited for a Final Demand and instead received a CPN.

This is especially frustrating to those of us who realized we could skip the Conditional Payment Letter stage if we wanted Final Demands faster.  Moreover, the language of the CPN often causes concern: Did the MSPRC receive the settlement information from me?  Are my fees and costs included?  Usually the answer to those questions is yes.  It sent a CPN instead of a Final Demand because there had not been a Conditional Payment Letter.  In theory – this is a nice gesture by them.  You can see a Medicare lien before it becomes a Final Demand.  You can dispute charges in the 45 day interim period.  But it adds another 45 days (at least).

So how can you avoid the Conditional Payment Notice stage?  As always: Start early!  If you notify the COBC of your case early in the litigation process you will get Conditional Payment Letters.  Then, when you settle, you will get a Final Demand, rather than a CPN.

If you forget to start the Medicare lien resolution process early enough, or simply settle quickly (good for you!), you can still reduce the CPN time frame.  When you receive the CPN you should call the MSPRC and tell them you want a Final Demand now.  The representative may ask if you disagree with any charges – but that is not relevant.  You can still appeal after the Final Demand.  This phone call may cut as much as a month from the CPN/Final Demand interim period (if you can bear waiting 2 hours on hold).

Remember, start early on Medicare liens.  Notify the COBC as soon as possible.  If you need assistance with Medicare liens, Medicaid liens, ERISA liens, or any other healthcare liens, contact LRS.

Ryan J. Weiner
Co-Founder Lien Resolution Services
www.lienresolutionusa.com
http://lienblog.wordpress.com
rweiner@lienresolutionusa.com
This Blog/Web Site is made available by the publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

Medicare’s Procurement: Do Nothing, Lower Your Lien

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In All Medicare lien resolution cases (*Not including Workers’ Compensation MSAs) the MSPRC will automatically reduce its Medicare lien if you do just one simple thing.  When you report settlement to the MSPRC you must give your costs and fees.  In turn, the MSPRC will reduce its conditional payment amount by about 33 – 42 percent for its Final Lien Demand.

First, the contingent fee of 1/3rd will lead to a 1/3rd reduction (or 33 percent) in the Medicare lien amount.  Then, your client’s costs will lead to another reduction in the Medicare lien amount.  At Lien Resolution Services, LLC, we generally see the costs lead to an additional 0 – 9 percent reduction.  The MSPRC generally requires an itemization of these costs.

It’s that simple.  Reduce your Medicare lien amount by appropriately (and timely) notifying the MSPRC of settlement.  If you do not, you may run into the Conditional Payment Notice situation, where costs/fees may not go into the reduction.  Remember, it takes just 2-3 weeks to get a Final Lien Demand – the MSPRC does not hesitate when it can recoup funds!

If you have any questions on this process, or would like lien resolution assistance, please contact us.

Ryan J. Weiner
Co-Founder Lien Resolution Services
www.lienresolutionusa.com
http://lienblog.wordpress.com
rweiner@lienresolutionusa.com
This Blog/Web Site is made available by the publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.