The Settlement Alliance

CMS Withdraws Future Medicals NPRM

CMS Withdraws Future Medicals NPRM

Oct 24, 2014

Earlier this month, the Centers for Medicare and Medicaid Services (CMS) withdrew its Notice of Proposed Rulemaking (NPRM) regarding Medicare Secondary Payer and Future Medicals, which had been submitted to the Office of Management and Budget in August 2013 and was preceded by an Advanced Notice of Proposed Rulemaking in 2012.

The withdrawal of this NPRM, which happened without much fanfare from CMS, is particularly significant in the process to fully define regulations regarding future medical care for those involved in non-workers’ compensation injury cases. Medicare Secondary Payer provisions stipulate that for any settlements that include funds for future injury-related medical care, Medicare acts as the secondary payer where other insurance should be primarily responsible for payment (i.e. workers’ compensation, group health insurance, liability insurance, etc.). To protect Medicare’s interests, CMS recommends the Medicare Set-Aside (MSA) in certain cases as a means of reserving settlement funds for future medical care.

While CMS has issued instructions for the handling of workers’ compensation Medicare Set-Asides in the form of a reference guide, to date, little guidance has been released on the subject of liability Medicare Set-Asides, other than a brief 2011 memo. The August 2013 NPRM had signified a possible step towards more definitive instruction for liability Medicare Set-Asides.

However, with calls from various associations including the American Association for Justice and the Brain Injury Association of America, CMS appears to have backed off for the time being. The reason for withdrawing the NPRM, however, remains unclear at this time, although in a press release on the subject, the Brain Injury Association of America claimed that the regulations “would limit access to settlement funds and leave people with injuries without the benefit of Medicare coverage while seeking legal compensation for wrongful injury.” Based on criticism from various plaintiff advocate groups and Medicare experts, it is reasonable to assume that CMS has gone back to the drawing board to further clarify and re-work proposed rules concerning non-workers’ compensation settlements.

In the meantime, attorneys and claimants should contact a professional who is experienced in handling settlements involving Medicare beneficiaries. Although there are still no definitive regulations for how to handle future medicals in a liability case, Medicare Secondary Payer provisions still require that Medicare’s interests are protected. A skilled professional can help determine the necessity for a MSA, and can walk the claimant through the step-by-step process of protecting their settlement and Medicare.

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