Navigating the Intersection of Workers' Compensation and Medicare: Crucial Insights and Key Facts
Nailing down the nitty-gritty of workers' compensation and Medicare is pivotal for anyone who's currently on Medicare or is close to being eligible. Here's the lowdown:
Workers' compensation is insurance that kicks in when folks suffer job-related injuries or illnesses. The Office of Workers' Compensation Programs (OWCP) under the Department of Labor is the crew responsible for this deal. It covers federal employees, their families, and certain other entities.
Now, if you're already on Medicare or soon will be, it's essential to grasp how workers' compensation could impact Medicare's coverage of your bills for work-related medical care. Under Medicare's secondary payer policy, workers' compensation should be the main payer for any care linked to a work injury.
If health care costs pop up before you receive your workers' compensation settlement, Medicare might pay first. Then, a recovery process handled by the Benefits Coordination & Recovery Center (BCRC) will kick into action. To avoid this recovery process, the Centers for Medicare & Medicaid Services (CMS) usually wants to monitor the money you receive from workers' compensation for your injury or illness-related medical care. In some cases, Medicare may request a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover your care once the money in the WCMSA is spent.
So, which settlements do you need to inform Medicare about? Workers' compensation must pass along the Total Payment Obligation to the Claimant (TPOC) to CMS if the settlement is $25,000 or more if you're already enrolled in Medicare or about to be, or if you're not currently enrolled but will within 30 months, and the settlement amount is $250,000 or more.
And it's not just workers' comp you need to report - you must also flag any liability or no-fault insurance claims, too.
Got some questions? Feel free to hit up Medicare at 800-MEDICARE, or chat them up on Medicare.gov in certain hours. If you've got queries about the Medicare recovery process, give the BCRC a ring at 855-798-2627.
A Medicare set-aside is optional, but by setting one up, your workers' compensation settlement must be over $25,000 or $250,000 if you're meant to be on Medicare within 30 months. And don't think about using the moolah in your WCMSA for any reason other than the designated purpose, or you risk claim denials and having to reimburse Medicare.
In case you're wondering: Medicare requires reporting of workers' compensation settlements through mandatory insurer reporting provisions established by the Medicare, Medicaid, and SCHIP Extension Act of 2007. Primary payers—such as insurance carriers and third-party administrators—must first determine if a claimant is a Medicare beneficiary. If so, the payer is required to report specific information about the settlement to the Centers for Medicare & Medicaid Services (CMS) once the case is resolved. This involves more than 200 data points, including ICD-9 or ICD-10 codes, accident/injury descriptions, details about the settlement, including the settlement amount, etc. For cases involving a Medicare Set-Aside (MSA), five specific data points must be reported. CMS sets specific thresholds for its review of Workers’ Compensation Medicare Set-Aside (WCMSA) arrangements, and failure to report settlement information as required could lead to penalties.
Takeaway: Workers' compensation is insurance for job-related injuries or illnesses for federal employees and certain other groups. It's significant for those on Medicare or soon to be to educate themselves on how workers' compensation could affect their Medicare coverage to prevent issues with medical expenses. And, of course, it's crucial to inform Medicare about workers' compensation agreements to avoid future claim rejections and reimbursement obligations.
- The Centers for Medicare & Medicaid Services (CMS) has mandatory insurer reporting provisions established by the Medicare, Medicaid, and SCHIP Extension Act of 2007, requiring primary payers to report specific information about workers' compensation settlements to CMS.
- In addition to workers' compensation, individuals must also report any liability or no-fault insurance claims to Medicare.
- A Medicare set-aside is optional, but setting one up is necessary when the workers' compensation settlement is over $25,000 or $250,000 if the settlement recipient will be on Medicare within 30 months.
- Under Medicare's secondary payer policy, workers' compensation should be the primary payer for any care linked to a work injury, and Medicare will only cover care once the money in the WCMSA is spent.
