Navigating Workers' Compensation and Medicare: Essential Information to Understand
Navigating workers' compensation arrangements is essential, especially if you're enrolled in Medicare or soon will be. If you don't inform Medicare about these arrangements, you could face claim denials and the need to repay Medicare.
Workers' compensation offers financial assistance to individuals who have sustained injuries or illnesses directly due to their work. The Office of Workers' Compensation Programs (OWCP), located under the Department of Labor, oversees this benefit for federal employees, their families, and certain other entities.
Understanding the impact of workers' compensation benefits on Medicare's coverage of medical claims is crucial to avoid complications with work-related injury or illness-related medical costs.
How does a workers' comp settlement affect Medicare?
Medicare abides by the secondary payer policy, which means workers' compensation should be the primary payer for any treatment related to a work injury. If immediate medical expenses arise before the individual receives their workers' compensation settlement, Medicare may pay first but initiate a recovery process managed by the Benefits Coordination & Recovery Center (BCRC). To avoid this recovery process, the Centers for Medicare & Medicaid Services (CMS) tends to monitor the amount a person receives from workers' compensation for their injury-related medical care. In some cases, Medicare may ask for the establishment of a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover the care after all the money in the WCMSA has been spent.
What settlements have to be reported to Medicare?
Workers' compensation must submit a total payment obligation to the claimant (TPOC) to CMS to ensure Medicare covers the right portion of a person's medical expenses. This represents the total amount of workers' compensation owed to the person or on their behalf. Submitting a TPOC is necessary if a person is already enrolled in Medicare based on their age or based on receiving Social Security Disability Insurance, and if the settlement is $25,000 or more. TPOCs are also necessary if the person is not currently enrolled in Medicare but will qualify for the program within 30 months of the settlement date, and the settlement amount is $250,000 or more. Along with workers' comp, a person must report to Medicare if they file a liability or no-fault insurance claim.
Frequently asked questions
To address any questions, a person can contact Medicare by phone at 800-MEDICARE (800-633-4227, TTY 877-486-2048). During certain hours, a live chat is also available on Medicare.gov. If a person has questions about the Medicare recovery process, they can contact the BCRC at 855-798-2627 (TTY 855-797-2627).
A Medicare set-aside is voluntary, but if a Medicare beneficiary wants to set one up, their workers' compensation settlement must be over $25,000. Alternatively, it must be over $250,000 if they are eligible for Medicare within 30 months.
It is prohibited to use the money in a Medicare set-aside arrangement for any purpose other than the one for which it is designated. Misusing the money can lead to claim denials and the need to repay Medicare.
"Learn more: What to know about Medicare set-aside arrangements"
Takeaway: Workers' compensation is an essential insurance for job-related injuries or illnesses for federal employees and certain other groups. It is vital that those enrolled in Medicare or soon to be eligible understand how workers' compensation might affect their Medicare coverage to prevent issues with work-related medical expenses. It is also crucial to inform Medicare about workers' compensation agreements to avoid future claim rejections and repayment obligations.
Medicare resources
For more resources to help guide you through the complex world of medical insurance, visit our Medicare hub.
"To ensure that Medicare covers the appropriate portion of work-related medical expenses, a total payment obligation to the claimant (TPOC) must be submitted to Medicare when receiving a workers' compensation settlement of $25,000 or more, especially if the recipient is already enrolled in Medicare or will become eligible within 30 months.
When the Medicare set-aside arrangement (WCMSA) is established to settle Medicare's future interest in the individual's work injuries, only health-and-wellness therapies-and-treatments will be covered after the allocated funds have been spent.
If a recipient of workers' compensation Medicare set-aside misuses the funds for purposes other than what they were intended, it could lead to claim denials and the need to repay Medicare."
"Explore more: Comprehending Medicare set-aside arrangements"
"Insights: Navigate the Medicare maze using our Medicare hub resources"
