Question: What is the obligation of the plaintiff attorney if the client is receiving Medicare but no payments were made related to the accident and if the plaintiff requires surgery 10 years from now, can Medicare deny payment if an MSA is not set?
Answer: If a client is receiving Medicare but not payments were made related to the accident, and the settling parties contemplate a future surgery that would be Medicare covered, the plaintiff should consider whether a MSA will be needed. Medicare can deny payment if some part of the settlement was allocated to cover the future surgery. Medicare uses CDC Table 1 to determine expected life expectancy. If the settling parties discussed the future surgery, and anticipated it would occur within that expected life expectancy, there may be a future cost of care component to the settlement.
However, using the SAVE method, we see the following results:
Screen: Yes, client is an MSA candidate (on Medicare at time of settlement).
Assess: What is the total amount of the settlement in relation to the amount that might be set aside for future medicals? There were no past medicals (that Medicare paid for, but was there another source of those payments? Did an insurer other than Medicare pay for any past medicals? If not, what is the amount of the other (non-future medical) damages? So, right now, you would need to know more information before you can get to value.
Value: How much will the future surgery cost Medicare if it is primary payer? (Similar to a redacted life care plan).
Educate: your client about this potential obligation. Find out, if a liability case, whether your client wants to obtain CMS approval; noting that there are thresholds in place for Wcomp settlements ($25,000 if Medicare enrolled at time of settlement; $250,000, plus reasonable anticipation of being a Medicare beneficiary within 30 months of settlement for those not Medicare enrolled at time of settlement). Client should decide how important saving Medicare card is to him/her.
So yes, Medicare could deny payment, if there is a future cost of care (surgery) and money was not set aside to cover it based on a review of all the issues. If, on the other hand, client’s spouse has insurance that will cover the surgery, then Medicare is not primary to that future medical expense, so you would document the file you properly considered Medicare’s interests in remainining a secondary payer post-settlement.
If you do not have a shift of the burden of paying for and managing the future costs of care, then it is unlikely Medicare will deny any future benefits.
John Cattie - Future Cost of Care Attorney
Building on a decade of experience providing MSA services, GRG has launched an innovative online-based tool, the MSA Decision Engine. It simplifies the first step that evaluates whether an MSA is needed by guiding you through a series of simple questions and steps and provides a comprehensive, accurate, fast and compliant recommendation to ensure Medicare’s future interests are considered.
Leave a Comment