Medicare Set-Asides

Medicare Set Asides (MSA) help show Medicare that their interests are protected. Medicare is known as the Second Payer in cases where an individual has medical care not provided by Medicare, such as in a liability or workers compensation case, and Medicare (also known as CMS) needs.  The individual needs to have already been a Medicare recipient with a settlement of more than $25,000 or or will be a Medicare recipient within 30 months of the settlement and the settlement is greater than $250,000.

Medicare Set Asides are already used extensively in Workers’ Compensation cases, and are could be potentially required for Personal Injury Victims.   This has been debated and has not yet been confirmed as mandatory for liability cases, however, some professionals consider having a MSA in place and in the file as an “insurance” policy if Medicare should come calling, including using a Third Party Administrator for managing the settlement fund.  The fines for not explicitly defining how Medicare’s interests should be protected (the MSA) can be quite steep while the development of an MSA is relatively inexpensive.   Medicare does have the “right” to recover future medical costs in a liability case, so having the “insurance” in the legal file minimizes the potential of future issues if there were to be an audit.

Is is highly suggested that a Medical Set Aside professional (experienced, educated and potentially certified) be used to develop the Medicare Set Aside to help avoid errors and omissions and if the MSA has been prepared for a Liability case, ensure that a copy is in the case files in the event of a CMS inquiry. 

Good Reading:

https://www.cms.gov/medicare/coordination-benefits-recovery/beneficiary-services/liability-no-fault-workers-compensation-reporting

https://www.sandersoncomp.com/blog/liability-medicare-set-asides-are-they-a-mythical-unicorn-or-a-realistic-obligation-under-the-msp

Why You Should Not Ignore Medicare’s Interests in Your Liability Settlements