MSA Responsibilities and the MSPA, 2021

Written by: Meredith Knight, Esq.

Famously, the Medicare Secondary Payer Act has not changed significantly in decades.  It is clearly understood that the MSPA prohibits Medicare from making payments that are the responsibility of a primary payer.  Such primary payers include workers’ compensation plans.  Workers’ compensation employers/insurers have a duty to consider Medicare’s interests as they pay for ongoing medical care and engage in settlements, especially those closing a claim’s medical considerations.

There is no specific rule dictating how consideration and protection must happen. As a result, we have Medicare Set Asides (MSAs). These are designed to show precisely how Medicare’s interests have been considered as a detailed dollar-amount per each modality or medication to which a workers’ compensation claimant is entitled for a particular injury. The money is “set-aside,” usually in an annuity, as the primary payment method for services related to the work injury.

This is not to say that everything under the sun should be included in an MSA.  To reduce the cost of an MSA, we gather statements from our authorized treating physicians (ATPs) delineating the future care necessary to address the work injury.  It is equally as important to ask the ATP to state in writing which conditions and treatments are not related to the work injury when making these projections.

In addition to the responsibilities above, Section 111* requires carriers and self-insureds to report and identify Medicare beneficiaries with injury claims. When a query is made into an individual’s Medicare status, the possible responses are “Y”, meaning “yes this person fits the requirement and/or is a Medicare beneficiary;” or “U”.  “U” does not stand for “no.” It stands for “undetermined.”  It is not necessarily simple to identify individuals with a reasonable expectation of Medicare eligibility.   As a result, Congress passed the Provide Accurate Information Directly (PAID) Act of 2020.

Entities with reporting requirements are being given a new tool to help protect and consider Medicare’s interests with the PAID Act with expanded searches identifying such individuals. The PAID Act has put some responsibility on the Department of Health and Human Services to assist finding the applicable Medicare plan; plus, whether a claimant subject to the query is presently, or during the preceding three-year period was, entitled to benefits under the program under this title on any basis.  Realistically, the PAID Act adds helpful layers to information available and creates a better database to obtain information.  As a result, reporting is easier because the search is easier and more expansive.  There will be more information returned than simply “Y” or “U.”

To put this into action, in September 2021, CMS hosted a webinar announcing the testing of a new software program tool.  The updated search tool is still in the testing phase.  On or around December 11, 2021, it will be ready to launch.  As with all new software, we cannot assume a  perfect response the first time. Real-time use and time will tell the glitches that need to be corrected, and they can be addressed accordingly.  Nevertheless, with better information available via the search tool, it will be easier to fulfill the reporting requirements, and determine who is a Medicare beneficiary.  As a result, it will be easier to protect the interests of Medicare.

* For information on CMS, reporting and MSPA, visit here.

See also: Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA), 42 U.S.C. 1395y(b)(8).