Workers' Compensation and Medicare Interactions: Essential Information Explained
Importance of Informing Medicare about Workers' Compensation Settlements
Understanding the implications of workers' compensation arrangements on Medicare coverage is vital for individuals who are currently enrolled in Medicare or approaching eligibility. Failure to notify Medicare about such arrangements could lead to claim denials and reimbursement obligations.
Workers' compensation serves as insurance for employees who sustain injuries or illnesses due to job-related activities. The Office of Workers' Compensation Programs (OWCP), a division of the Department of Labor, is responsible for this benefit, which extends to federal workers, their families, and certain other entities.
To maintain seamless, cost-effective medical care for work-related injuries and illnesses, it's essential for those enrolled in Medicare to understand how their workers' compensation benefits intersect with Medicare's coverage.
Impact of Workers' Comp Settlements on Medicare
Under Medicare's secondary payer policy, workers' compensation must cover any medical treatment for work-related injuries before Medicare steps in. This policy aims to ensure that Medicare avoids covering costs that should be borne by workers' compensation.
If immediate medical expenses arise before the workers' compensation settlement is received, Medicare may cover the initial costs and initiate a recovery process managed by the Benefits Coordination & Recovery Center (BCRC). To prevent this recovery process and the associated complications, the Centers for Medicare & Medicaid Services (CMS) monitors the amount received from workers' compensation for injury or illness-related medical care.
In some cases, Medicare may establish a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover care after the WCMSA has been depleted.
Required Reporting
The Total Payment Obligation to the Claimant (TPOC) from workers' compensation must be submitted to the Centers for Medicare & Medicaid Services (CMS) if the settlement exceeds $25,000 for individuals already enrolled in Medicare or eligible for it within 30 months. Similarly, this reporting requirement applies if a person currently not enrolled in Medicare will soon qualify based on age or Social Security Disability Insurance, and the settlement exceeds $250,000.
In addition, any liability or no-fault insurance claim filing must also be reported to Medicare.
Answers to Common Questions
Individuals can contact Medicare for guidance by phoning 800-MEDICARE or via live chat during specified hours on Medicare.gov. For questions about the Medicare recovery process, contact the BCRC at 855-798-2627 (TTY 855-797-2627).
A Medicare set-aside is voluntary, but if a person chooses to establish one, the settlement must exceed $25,000 or $250,000 under specific circumstances. Misusing funds set aside for medical care can result in claim denials and reimbursement obligations.
Takeaway
Workers' compensation provides insurance coverage for job-related injuries and illnesses for eligible groups. Ensuring Medicare is aware of any workers' compensation arrangements is essential to avoid claim rejections, reimbursement obligations, and future complications with medical expenses.
- To prevent claim rejections and reimbursement obligations, it's important that Medicare is informed about any workers' compensation arrangements due to job-related injuries or illnesses.
- Medicare's secondary payer policy requires workers' compensation to cover medical treatment for work-related injuries before Medicare steps in, thus preventing Medicare from paying for costs that should be covered by workers' compensation.
- In the event of a workers' compensation settlement exceeding $25,000 for Medicare enrollees or those who will be eligible within 30 months, or $250,000 for non-enrollees who will soon qualify, the Total Payment Obligation to the Claimant (TPOC) must be reported to the Centers for Medicare & Medicaid Services (CMS).
- Under the health system, both Medicare and workers' compensation play key roles in providing coverage for medical care related to work-related injuries and illnesses, with proper coordination essential for optimal health-and-wellness, therapies-and-treatments, and nutrition outcomes.
