Medicare and Workers' Compensation: Crucial Information to Understand
Dishin' the Lowdown on Workers' Comp and Medicare
Knowing the ropes can save you a world of trouble when it comes to workers' compensation and Medicare. Neglecting to notify Medicare about a workers' comp deal could lead to denied claims and a nasty bill to pay back the insurance giant.
Workers' comp is a benefit for employees who sustain job-related injuries or illnesses, administered by the Office of Workers' Compensation Programs (OWCP) under the Department of Labor. This perk extends to federal workers, their families, and certain other entities.
It's essential for those already enrolled in Medicare or about to qualify for the program to be in the know about how their workers' comp benefits could impact Medicare's coverage of medical bills for work-related injuries. This is crucial for avoiding complications with medical costs when it comes to work-related accidents or sicknesses.
Workers' Comp and Medicare: A Dance of Coverage
Under Medicare's secondary payer policy, workers' comp must foot the bill for any treatment related to a work-related injury. However, if immediate medical expenses pile up before the individual receives their workers' comp settlement, Medicare may chip in first and then initiate a recovery process managed by the Benefits Coordination & Recovery Center (BCRC). To sidestep a recovery process, the Centers for Medicare & Medicaid Services (CMS) prefers to keep tabs on the amount a person receives for their injury or illness-related medical care from workers' comp.
In some instances, Medicare may request a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover treatment after the WCMSA fund has been depleted.
Which Settlements Need to be Disclosed to Medicare?
Workers' comp must submit a total payment obligation to the claimant (TPOC) to CMS to ensure Medicare covers the appropriate portion of a person's medical expenses. This filing represents the total amount of workers' comp owed to the person or on their behalf.
Submitting a TPOC is necessary if a person is already enrolled in Medicare based on age or Social Security Disability Insurance, and the settlement is $25,000 or more. Similarly, if the person is not enrolled in Medicare yet but will qualify within 30 months of the settlement date, and the settlement amount is $250,000 or more, a TPOC must be submitted.
Also, if a person files a liability or no-fault insurance claim, it must be reported to Medicare as well.
FAQs
Got questions? Medicare's got your back! Reach out to Medicare by phone at 800-MEDICARE (800-633-4227) or TTY 877-486-2048. During certain hours, live chat is available on Medicare.gov. If you have specific questions about the Medicare recovery process, you can contact the BCRC at 855-798-2627 (TTY 855-797-2627).
A WCMSA is optional, but if you want to set one up, your workers' comp settlement must be over $25,000 (or over $250,000 if you're eligible for Medicare within 30 months).
Yes, it's against the rules to use the money in a WCMSA for anything other than its intended purpose. Misusing the funds can lead to claim denials and a hefty bill to pay back to Medicare.
Beyond the Basics:
The process of reporting workers' comp settlements involving Medicare beneficiaries is complex, especially for settlements surpassing $25,000 or $250,000. Here's what you need to know:
- Reporting Requirements: The Centers for Medicare and Medicaid Services (CMS) evaluates Workers' Compensation Medicare Set-Aside (WCMSA) arrangements based on specific thresholds, although specific dollar amounts like $25,000 or $250,000 are not universally applied for all cases.
- Reporting Obligations: Responsible Reporting Entities (RREs) must report settlements, judgments, or awards to CMS, including cases that do not specifically allocate funds for medical expenses but include such claims.
- Compliance and Penalties: RREs must comply with these reporting requirements to avoid penalties. Failure to comply can result in civil penalties of $1,000 per day per incident.
- MSA Reports: Detailed reports that estimate the anticipated Medicare allowable, injury-related expenses are required when an MSA allocation was prepared.
- Annual Attestation: Beneficiaries must submit an annual attestation to Medicare, stating that they have used MSA funds correctly, to ensure compliance and guarantee that Medicare will resume coverage once the MSA funds are exhausted.
Starting July 2025, CMS will implement changes to the WCMSA reporting process, including new data points required for all WC settlements involving Medicare beneficiaries. Keep your eyes peeled for these updates!
- The Centers for Medicare & Medicaid Services (CMS) prefer to keep track of the amount a person receives for their injury or illness-related medical care from workers' comp under Medicare's secondary payer policy, to avoid complications with medical costs when it comes to work-related accidents or sicknesses.
- A Workers' Compensation Medicare Set-Aside Arrangement (WCMSA) may be requested by Medicare for funds related to work-related injuries. Medicare will only cover treatment after the WCMSA fund has been depleted.
- Submitting a total payment obligation to the claimant (TPOC) to CMS is necessary if a person is already enrolled in Medicare based on age or Social Security Disability Insurance, and the settlement is $25,000 or more.
- Nutrition, health-and-wellness, therapies-and-treatments, and other healthsystems benefits may not be covered under workers' comp or Medicare, and it is essential to understand how these benefits could impact each other in the context of work-related injuries.
