SMART Act: Final/Conditional Medicare Lien Process

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Looking back at yesterday’s SMART Act post it is hard to decipher how to properly obtain what we are calling a “Final Conditional” Amount or Lien.  We hope the following workflow (including our assumptions and expectations of the future process) will help:

  1. T-120 days to settlement – Send an Expected Settlement Notice to the MSPRC;
  2. T-115 days to settlement – Check to see if the MSPRC received the Expected Settlement Notice.  Everyone knows the MSPRC response, “we don’t have that in the file” or “I don’t see that here.”  If you don’t check you might waste the entire process.
  3. T-55 days to settlement – You should receive notice that the Final Conditional Amount is available for download on the MSPRC website, or more likely, the Medicare Secondary Payer Recovery Portal (MSPRP).  If you have not, contact the MSPRC to check the status.  Keep in mind the rule states they have 65 days from receipt of your notice – so we will have to keep track of how they define the word receipt.  If your case qualifies for “exceptional circumstances” the MSPRC will tell you it needs another 30 days to process the Final Conditional Amount.
  4. T-25 days to settlement – You should receive notice that your exceptional circumstances request is completed and the Final Conditional Amount is available for download.
  5. T-3 days to settlement – You must download the Final Conditional Amount from the designated website.  If you do so at 4 days to settlement it is apparently invalid and does not constitute a Final amount.  If you do so more than 3 days after settlement (we believe after is still okay – the rule uses the word “within”) it is also invalid.

Starting in October you should follow these rules to obtain a Final Conditional Amount.  Just one slip up and you might not get it.  Keep in mind the discrepancy dispute process allows the MSPRC an 11 business day response time or the dispute is deemed admitted.  We expect plenty of dispute denials as a result of the tight time frame.

We will work with our contacts at CMS and the MSPRC to better understand this process.  If you need help with any type of lien resolution we can assist you with Medicare lien resolution, Medicaid lien resolution, ERISA liens, private insurance liens, and more.  We’ll take care of getting you the “lien” and reducing it too.

 
Ryan J. Weiner
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.

 

 

SMART Act: Is Medicare Lien Resolution Smarter Now?

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On January 10, 2013, President Obama signed H.R. 1845.  Included on the Medicare IVIG Access Bill is the SMART Act.  SMART was designed to reform the conditional payment, final demand, and MMSEA Section 111 reporting processes.  Click here to read the full text of H.R. 1845.  As you can see below, we aren’t as excited with SMART as we had been in the past.

The Problem Before SMART

The problems we have run into (say, prior to January 10, 2013) usually involve attorneys on both the plaintiff and defense side not realizing the Medicare lien is not final.  SMART was intended to address the question:

“How do I settle if I don’t know how much Medicare wants?”

Before SMART our answer was usually long, calculated, and not really an answer.

We would tell attorneys that we have a conditional payment amount of X and that it will reduce down to Y after you provide Medicare with your costs and fees.  But we would remind them that the conditional payment amount would get one more review at that time, and, if Medicare found any new payments it deemed related, it would add those payments to the Final Demand.  We could assume the lien may or may not change depending on the age of a conditional payment letter.  For example, if the conditional payment letter was more than a year old we would worry that it would increase.  Of course, as long as we were involved in the process, we wouldn’t allow the case to proceed without obtaining updated conditional payment letters every few months.

Now we ask two new questions: What does the final version of SMART look like? What changes?

The SMART Act: Sections 201-205 of Medicare IVIG Access

Section 201 – Determination of reimbursement amount through CMS website to improve program efficiency

Section 201 is the most important section to Medicare lien resolution.  The section seeks to improve efficiency in the conditional payment system, including providing a mechanism for pre-settlement final demands.  In a nutshell, here’s how it works:

  1. At any time 120 days prior to the expected settlement, judgment, or award the claimant or applicable plan may notify the Secretary (of HHS, in reality they notify the MSPRC) of the expected date of settlement.  You need not notify the MSPRC of the expected amount.
  2. CMS then has 65 days from receipt of said notification/request to provide the Medicare reimbursement amount (via the Website).  This 65 day period can be extended to 95 days in exceptional circumstances; however, exceptional circumstances are limited to 1 percent of repayment obligation files. The time period after the 65-95 day period and before the end of the 120 day limit is deemed by the new 1862(b)(2)(B)(vii)(V) as the “Protected Period.”
  3. If the plaintiff or applicable plan downloads a Medicare claims statement from the Website during the Protected Period, and, does so within 3 business days before the date of settlement, judgment, award, or other payment, that downloaded amount shall constitute the “final conditional amount.”
  4. There is also a mechanism for a non-appeal reduction of this final conditional amount.  Section IV states that the plaintiff can provide documentation describing and explaining the discrepancy between the amount and the amount he believes is fairly related to the case.  There is no time frame for sending this discrepancy dispute; however, we believe the MSPRC will create a limited time frame.  Then, the MSPRC is given just 11 business days (following receipt) to determine whether there is a reasonable basis for it to remove the claims.  If no determination is made within the 11-business days the discrepancy dispute is deemed accepted.  We also expect strict rules on that 11-day time frame (likely not based on your receipt of the MSPRC response).  It is important to remember that this discrepancy dispute process is not connected to and does not limit the regular appeals process that currently exists.

Sections 202-205

Sections 202-205 are not as important to the Medicare lien resolution process.  Section 202 creates a minimum threshold for both Mandatory Insurer reporting and conditional payment reimbursement.  The Secretary of HHS is required to publish that threshold by November 15 each year.  Application of this section begins in 2014.

Section 203 makes fines for noncompliance of Mandatory Insurer Reporting discretionary instead of mandatory.  Guidelines are not yet developed.

Section 204 states that a Responsible Reporting Entity in Mandatory Insurer Reporting need not report SSNs or Health Insurance Claim Numbers.  The time frame for implementing Section 204 is 18 to 30 months.

Section 205 creates a statute of limitations for conditional payment recovery of three years.

Will SMART help?

Yes. No. Maybe.

SMART has good intentions; however, it has very strict requirements.  It may be difficult to qualify for a final conditional reimbursement amount.  You have to be vigilant to get that amount and then you have to settle within 3 days of the download.  If you forget to download the amount then it is not final.

We worry that the strict time frames on discrepancy disputes responses (just 11 days) will result in the MSPRC simply denying all disputes.  You can still appeal.

SMART must be implemented within 9 months of January 10 (approximately October 10) – hopefully the MSPRC can keep up.  The government will not allow the Medicare lien process to simply disappear through its own inability to keep up with time limits.

If you need help with any type of lien resolution we can assist you with Medicare lien resolution, Medicaid lien resolution, ERISA liens, private insurance liens, and more.  We’ll take care of getting you the “lien” and reducing it too.

Ryan J. Weiner
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.

 

 

House & Senate Pass Medicare’s SMART Act

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Both the House and Senate passed the SMART act prior to the Christmas holiday last week.  In the House just 3 “no” votes were cast against 401 “yes” votes.  The Senate passed the act without a single “no” vote.  There is little doubt that President Obama will sign the bill into law.

What is the SMART Act?

The SMART, or, Strengthening Medicare and Repaying Taxpayers Act is designed to cause major changes to the Medicare Secondary Payer (MSP) process for nongroup health plans.  This means it is aimed squarely at Medicare Parts A & B “liens.”  The Act effectuates changes to both plaintiff-beneficiaries and primary payers (a/k/a/ defendant insurance companies).  Plaintiffs and their attorneys should benefit from a provision locking in the Conditional Payment amount for three months.  Primary payers will benefit from safe harbor provisions for RRE reporting.

Primary Payer Benefits

The SMART Act will help primary payers primarily by creating a safe harbor where the primary payer is unable to obtain the plaintiffs’ Social Security Numbers after a good faith effort.  This change was necessitated by plaintiffs’ refusal to provide their Medicare numbers or SSNs due to privacy concerns.  Medicare numbers are often just as “private” as SSNs because they are generally the SSN followed by a letter.

The Centers for Medicare and Medicaid Services (CMS) had created a Query System to determine whether individuals are Medicare eligible; however, that system has been reliant on Medicare numbers and SSNs.  It will be interesting to see if CMS can develop a workable system that avoids such personal information.

In addition to eliminating the use of SSNs and Medicare numbers, SMART creates a three-year statute of limitation for all MSP claims.  The statute of limitations issue had been hotly contested prior to this change.

Finally, the $1,000/day penalty for non-reporting will be modified.

Plaintiff-Beneficiary Benefits

The key benefit for Plaintiffs and their attorneys will be the ability to “lock in” conditional payment amounts prior to settlement.  If you provide the MSPRC with enough time to calculate the conditional payments prior to settlement, and, if you notify the MSPRC of settlement less than three months after its determination of conditional payments, it cannot increase that amount.  We do question whether the MSPRC can comply with such a system.  This rule could lead to an even longer waiting period for the initial conditional payment letter.

Nonetheless, this 3-Month Lock-In should be very exciting to plaintiff attorneys as it should take some of the guessing game out of MSP compliance.  It is important to remember the SMART Act does not effect or create MSA rules.

At Lien Resolution Services we can assist you with Medicare lien resolution, Medicaid lien resolution, ERISA liens, private insurance liens, and more.  We’ll take care of getting you the “lien” and reducing it too.

 
Ryan J. Weiner
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.

LRS Public Comment: CMS-6047-ANPRM – CMS Proposed Rules for Liability Medicare Set-Asides

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As you should know, Medicare has taken its first steps toward requiring Medicare Set-Asides in all personal injury cases.  On June 15, 2012, it (via CMS and HHS) posted a request for public comment on rules it hastily created for a potential LMSA system.  Our initial analysis of the federal register posting from June 15 can be found on our blog: Advanced Notice of Proposed Rulemaking.

We have finished our initial Public Comment on the matter.  You can read our Public Comment by clicking this link.

If you agree with our comment we urge you to e-sign in agreement by clicking here.

Our Public Comment emphasizes the long-term impacts that LMSAs will have on all personal injury cases.  We believe the requirement of LMSAs will create an unsustainability that severely limits this legal field.  Please take your time to read our comment and  e-sign in agreement by clicking here.

 

Ryan J. Weiner
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.

Federal Register – June 15, 2012: Advanced Notice of Proposed Rulemaking (LMSAs)

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The Friday, June 15, 2012 Federal Register includes a four-page request for public comment requested by the Department of Health and Human Services’ Centers for Medicare & Medicaid Services.  The comment is requested for potential changes to 42 CFR Parts 405 and 411 and is titled, “Medicare Program; Medicare Secondary Payer and ‘Future Medicals.’ “

The summary for the advanced notice of proposed rulemaking reads:

This advance notice of proposed rulemaking solicits comment on standardized options that we are considering making available to beneficiaries and their representatives to clarify how they can meet their obligations to protect Medicare’s interest with respect to Medicare Secondary Payer (MSP) claims involving automobile and liability insurance (including self-insurance), no-fault insurance, and workers’ compensation when future medical care is claimed or the settlement, judgment, award, or other payment releases (or has the effect of releasing) claims for future medical care.

DATES: To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on August 14, 2012.

Why is Medicare Requesting Comment?

This request for comment is essentially made by Medicare and its agents.  Ignore the use of the names HHS and CMS.  Simply consider these organizations as “Medicare.”

The stated purpose is to solicit comment on:

[s]tandardized options that beneficiaries and their attorneys or other representatives will be able to use to resolve MSP obligations related to settlements, judgments, awards, or other payments (hereinafter … “settlement(s)”)  involving future medical care while protecting Medicare’s interest.

More simply, the Advanced Notice is to begin setting up a process for Liability Medicare Set-Asides (“LMSA” or “LMSAs”).  This in turn means Medicare is attempting to recoup more funds to which it believes it is statutorily entitled via subrogation.  We all knew this was coming and we have all feared its arrival.  But this notice is a good thing. It gives us all the opportunity to educate Medicare on how best to set up an LMSA process – if one is possible at all.  We believe an LMSA process is possible, but the LMSA process must be severely limited due to its marked differences with Workers’ Compensation (which already has an MSA system).

To What is Medicare Requesting Comment?

Medicare is requesting comment on:

  1. The definition of:
    1. Chronic illness/condition;
    2. Physical trauma;
    3. Major Trauma;
    4. Future Medical Care; and,
    5. Date of Care Completion;
  2. The use of the Injury Severity Score (ISS) in predictive modeling of injuries and the need for future care;
  3. Seven (7) options for addressing “future medicals” for both Medicare beneficiaries and non-beneficiaries in liability settlements.  Those options are:
    1. The beneficiary pays for all case-related future medical care until his/her settlement is exhausted AND documents it accordingly.  This is known in the industry as the “Poor Man’s MSA;”
    2. A small claim safe harbor (with conditions);
    3. A Doctor’s note that the beneficiary has completed treatment;
    4. A full Liability Medicare Set-Aside (LMSA);
    5. The beneficiary participates in one of Medicare’s conditional payment recovery options (these are all small claim only);
    6. Upfront payment to Medicare; and,
    7. The beneficiary receives a compromise or waiver (where the Medicare lien is greater than 50% of the client’s net settlement).

 

LRS’s Initial Reactions

This Advanced Notice does NOT mean LMSAs will be mandatory.  But if we do not react appropriately, they could become mandatory in the future.  We are in the process of preparing a formal public comment – this is not that comment.

An unlimited LMSA system with the requirement that Regional CMS offices review and agreeto the LMSA could cripple the personal injury world.  Why?

  1. Preparations of MSAs are expensive, ranging from $2,500-$4,000 for submission;
  2. MSAs are backlogged for Workers’ Compensation, requiring a 9 month wait on top of the normal case litigation process;
  3. The current WCMSA system is based on litigation that separates the different areas of recovery in Workers’ Compensation (medical bills, lost wages, future medicals).  The liability system of settlement rarely separate those areas of recovery and adds non-economic damages (pain and suffering, loss of companionship/consortium, etc.) to the mix.  Medicare’s agencies have fought the idea of allocating settlements without judicial intervention on the merits.  This means you cannot write an order that 15% of the settlement is for future medicals and ask a judge to sign that order.  Medicare will not recognize it.  Instead, Medicare claims the judge must hear testimony for Medicare’s agents to agree with allocations.  Such a system would be unworkable and create massive backlogs in the judicial system.  Further, Medicare might still argue a state court judge has no jurisdiction over it; and,

LMSAs could even cripple the Medicare Trust Fund.  Medicare’s potential requirement of LMSAs would mean a short-term gain for the Medicare Trust Fund.  In the long-term the huge number of smaller liability cases would plummet, leaving Medicare with fewer and fewer recoveries and effectively forcing Medicare to become the primary payer.

Our full analysis of this subject will be available within the next few weeks. We will offer the opportunity to sign our official public comment as a supporter prior to our submission on August 13 (one day prior to the deadline.).

If you would like to include your own comment to be submitted with the LRS comment, or, are interested in signing our comment please contact me at rweiner@lienresolutionusa.com.

Regards,

Ryan J. Weiner

Managing Partner
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 Case Type Definitions: Liability & No-Fault

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The most important part of Medicare lien resolution occurs months (or even years) before you send payment to the MSPRC.  That most important process is reporting to the Coordination of Benefits Contractor (“COBC”).  If you report the wrong date of incident you risk wasting months of work.  If you report the wrong injuries you risk a lien that is either too small or too big.  And if you report the wrong case type you risk restarting the whole process.

Case Type Matters

During the initial reporting phone call to the COBC you will be asked what is the type of case.  Most cases fit under one or two of the following choices:

  1. Workers’ Compensation;
  2. Liability; and,
  3. No-Fault.

If you report the case as Workers’ Compensation there are certain Medicare Set-Aside (“MSA”) consequences.  Liability is relatively straight forward and leads to the default processes.  No-Fault is often reported concurrent to Liability (meaning both are open for your file) and has added processes to close the file.  No-Fault also has special rules – specifically, the MSPRC does not follow 42 CFR 411.37 and does not apply the Medicare Procurement Formula.

So, the case type changes the way Medicare’s agents treat your file.

Medicare’s Definitions are Different than Your Definitions

Surprise! Medicare defines simple legal terms different than you do.

“No-Fault” – Medicare essentially defines No-Fault as any insurance payments provided on a continuing basis until policy limits are exhausted.  This almost always means personal automobile insurance, whether it is Personal Injury Protection (“PIP”), Med-Pay, or otherwise.  There isn’t much surprise to what No-Fault means – until you see what Liability means.

“Liability” – Medicare does not interpret Liability as any case where someone else is liable.  Rather, it simply means a lump-sum settlement.  Generally it is pretty simple.  But when you look at states with high “No-Fault” automobile insurance limits, this gets tricky.  For example, in New Jersey ($250,000 PIP limits) or Michigan (unlimited PIP), Medicare will consider the PIP payments as No-Fault payments, until the 1st Party/No-Fault case settles.  Once that case settles fora set amount (a lump sum), Medicare will consider that payment to be a liability payment.

What does this all mean?

If you’re in a state where Med-Pay or PIP is limited to $5,000 or $10,000 you should open both a No-Fault and Liability file with the MSPRC.  If you’re in a state with high limits on Med-Pay or PIP (like Michigan and New Jersey), you might only need the Liability file open with the MSPRC.

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

 

Ryan J. Weiner
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 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.

MSPRC to Introduce Web Portal in Summer 2012

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The MSPRC has announced it will release a web portal for conditional payments much like that used for Workers’ Compensation MSAs.  From the MSPRC release:

Coming Soon – The Medicare Secondary Payer Recovery Portal

A new online Self-Service Tool to help manage your Medicare recovery case.

The Centers for Medicare & Medicaid Services (CMS) is in the process of implementing a new web-based tool designed to assist in and accelerate the resolution of Liability Insurance, No-Fault Insurance, and Workers’ Compensation Medicare recovery cases. The new tool is called, The Medicare Secondary Payer Recovery Portal (MSPRP).

The MSPRP will give users (attorneys, insurers, beneficiaries, and TPAs) the ability to access and update certain case specific information online. Activities that currently require written communication or telephone calls to the Medicare Secondary Payer Recovery Contractor will soon be able to be done through the portal.

The MSPRP will allow users the ability to electronically perform the following activities:

  • Submit Proof of Representation or Consent to Release documentation – Instead of mailing in an authorization, users will be able to upload authorizations through the portal.
  • Request conditional payment information – Requesting an updated conditional payment amount or a copy of a current conditional payment letter will be as simple as clicking a few buttons.
  • Dispute claims included in a conditional payment letter – Users will be able to view the claims listed on the conditional payment letter and dispute unrelated claims online.
  • Submit case settlement information – Users will be able to input settlement information online and upload a copy of the settlement documentation through the portal.

The MSPRP is scheduled to go live in July 2012. Additional details regarding the MSPRP will be shared on this website in the coming months.

 

We too will share more information on the MSPRP as it becomes available.  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.

The Congressional Failure to Understand Medicare

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Congressman Dennis Ross (Republican – Lakeland, Fl) spoke to the National Association of Medicare Set Aside Professionals (“NAMSAP”) convention on Friday, March 30, 2012.  Congressman Ross’s topics were Medicare liens and Medicare Set-Asides.

Note: I started this post as a recap of Congressman Ross’ talk with NAMSAP – but it turned into an 1111 word rant and opinion piece on the broken MSA system and the government’s failure to recognize it.

Congressman Dennis Ross (R – FL)

Congressman Ross began with a short discussion of HR 1063, the Strengthening Medicare and Repaying Taxpayers Act, or, “SMART.”  This act has been on the proverbial table for a while.  It has gone no where and Congressman Ross implied it is unlikely to get to a vote.  The Congressman’s frank discussion of SMART was a welcome departure from any politicized discussions; however, he lacked sufficient knowledge regarding the actual bill.

Throughout his lecture, Congressman Ross would mention Medicare Set Asides (“MSAs”), but the SMART Act refers to Conditional Payments (past-medical Medicare liens) only.  He also appeared to misunderstand the purpose of a Medicare Set Aside (even after making a joke that most congressmen would ask if an MSA is a medical savings account).  While I was disappointed with Congressman Ross’s lack of knowledge on the subject, I did see good come from his desire to see change.

The Congressman’s lack of knowledge on the subject shows the entire House & Senate likely lack the requisite background to cause real change.  They see one problem, but they don’t see another:

The first problem is the time and effort involved in getting Medicare lien information.  The second problem is the amount of funds Medicare loses out on in Workers’ Compensation case Medicare Set Asides.  SMART is designed to correct the first of those problems.  It might.  But it won’t become a law because it does not assist in generating revenue for the government.

The MSA Problem

But what about MSAs?  Why doesn’t anyone want to fix that broken system?  Shouldn’t the MSA system for Workers’ Compensation work before CMS tries to expand it to liability?

As of April 2, 2012, MSAs are accepted in the Workers’ Compensation community.  They are a point of contention amongst those involved in the Liability community.  An MSA is designed to protect Medicare’s future interests as it is never the Primary Payer; however, after an MSA is set up, most are “self-administered.”  This means the MSA funds go to the plaintiff who might never use those funds to protect Medicare. It also means that the MSA process generates revenue for the MSA professional community and wastes government funds.

If Congress wants a law that generates revenue – why not create something where the MSA process is actually useful?  The problem now is that MSAs are too hard to administer and are frankly unfair to the plaintiff.  They require the plaintiff to pay full billed amounts for care that Medicare would only pay pennies.  Congressman Ross continuously said the only way a Medicare lien bill will pass is if Congress can see it as a revenue generator.  My notes when he said that for the 5th or 6th time:

He has no idea how little of MSA funds are collected … I wish we had yearly prepayment of MSA funds to CMS and no need to worry about paying bills – it saves settlement funds by allowing Medicare rates.

Again – the above is from my own notes.  Some plaintiffs might not like this method – but it accomplishes the goals of the lawsuit while acting as a safe harbor where they could not lose Medicare coverage.  The plaintiffs’ attorneys wouldn’t mind as the MSA remains part of the case and their fee isn’t cut.  The defense attorneys would see status quo – perhaps slightly smaller settlements.  Even the MSA professionals would like this method because they would still get to prepare the highly complex (and expensive) MSAs.  Finally, Congress is ecstatic because it generates revenue (right, Congressman Ross?).

Both the MSA system  and the conditional payment recovery systems are broken.  SMART attempts to fix one of those, but its inability to fix the MSA system shows Congress’s lack of understanding in Medicare’s recovery systems.  Congressman Ross meant well.  My notes don’t indicate it, but his inability to comprehend the problems shows us why those problems exist, and what we need to do to fix the Medicare system.

 

Due Process for Medicare Liens

Finally, Congressman Ross mentioned a need for a “due process procedure” in Medicare liens.  I don’t think he meant to say one does not exist.  There are administrative processes for both conditional payments (via the MSPRC) and MSAs (via regional CMS offices).  The processes are slow.

I think he generally was referring to the system the SMART Act wants to create.  One where Medicare liens can be known prior to settlement.  Quite a few subrogation companies will guarantee liens for 30 or 60 days to encourage settlement.  Medicare does not yet.  That sometimes allows surprise payments to increase a Medicare lien.  SMART would create a system where final liens could be procured prior to settlement.  Beyond that system, there is a well-defined due process procedure.  It requires multiple administrative appeals – but it usually works.

Referring to MSAs, Congressman Ross likely meant a faster turnaround time.  The average MSA response time is 179 days.  That means CMS takes 179 days to respond to approval of an MSA.  Like Congressman Ross, I would like to see an improvement in that response time.  The courts would like to see that improve to clear out their dockets.  Even CMS would like to see that time improve, but how?

Again, I point to the general assumption that most MSA funds never are used for medical bills.  This means Medicare spends millions (perhaps billions) on care it shouldn’t pay.  It means CMS spends millions on a system that generates little, if any, revenue.  If CMS spent more time creating a system where the MSA funds are paid directly to it, it would have more funds to create bigger staffs.  It would hopefully recoup more MSA funds as a result.

 

What Did Congressman Ross Teach NAMSAP?

The point of this blog post was to recap Congressman Ross’s discussion on Medicare liens and MSAs.  It took a few tangents to get to a point.  But maybe that is the point.  Congressman Ross taught us that Congress won’t care unless changes improve revenue.  There are no changes to the conditional payment system that would increase revenue.  There are plenty of changes we can make to the MSA process.

Until the time that changes are proposed, LRS will be right here to assist you with driving down Medicare liens, creating MSAs, and assisting with any other subrogation matters stagnating over your cases.  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.

MSPRC Website: Liability Medicare Set-Asides are NOT Required

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Direct from the horse’s mouth (but I can’t take credit – thanks to the NAMSAP Listserv for this catch:

 

The MSPRC says no liability MSA is required

 

 

 

 

 

 

 

This image is from MSPRC.info – the website of Medicare’s agent.  It is just another argument that LMSAs are simply not required and cannot be required for Medicare liens.  The FAQ portion of the website lists the question:

“Does Medicare require a set-aside agreement for a liability case?”

And the answer:

“No. At present, set-aside agreement apply only to Workers Compensation cases.”

 

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.