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SPECIAL EDITION BULLETIN: Liability Medicare Set Asides

Wednesday, August 8, 2018   (0 Comments)
Posted by: Matt Reineke
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Liability Medicare Set Asides

By: Tom Stanley, CMSP, MBA, MSCC
The Stanley Insurance Agency, Inc.

Members of NAMSAP were invited to a meeting with CMS in Baltimore to discuss the topic of Liability Medicare Set-asides. The meeting with CMS took place on April 16, 2018. Everything discussed in the meeting was subject to change and RELATED TO LIABILITY MEDICARE SET-ASIDES ONLY.

Some highlights of the meeting are:

  • CMS stated they have an 18-month timeframe (from April 2018) before it rolls out a LMSA Review program.
  • The program would be voluntary.
  • CMS has indicated that their enforcement mechanism is the denial of services.
  • CMS felt strongly that the injured party must receive something (free and clear) through settlement.
  • CMS would not review an LMSA until Settlement has been reached.
  • CMS feels a LMSA is exclusively the responsibility of the plaintiff.
  • Regarding LMSA’s, CMS made it clear that the defendant(s), and their insurers, are not a target.
  • Medicare pricing of services was discussed.
  • CMS does not feel it can mandate professional administration.
  • CMS would publish a LMSA Reference Guide.
  • Eligibility remains the same as the current WCMSA system – Medicare beneficiaries or injured parties who have a reasonable expectation of Medicare eligibility within 30 months. Per statute, Medicare’s interest must be considered in every claim.
  • A workload threshold of $250,000 is anticipated - “NO SAFE HARBOR”. This level mirrors the $25,000 workload threshold for WCMSA’s.
  • For settlements between $250,000 and $750,000 threshold, CMS approval is available and encouraged by CMS. CMS would apply “a formula”to determine the LMSA amount. Starting with thetotal settlement amount, CMS would subtract certain expenses and apply the discount factor to total settlement.
  • Above $750,000 level is a full commutation. A traditional MSA would be prepared and, if submitted to CMS, evaluated by CMS for adequacy.

A session will be held at the Annual Conference and a possible Webinar are being prepared to provide more detailed information. Please send all questions and comments to Committee Co-chairs or William Delaney,

For more information on the conference and to secure your early bird discount, please click here.

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