To view a pdf of this advisory, please click here.
In its May 27, 2010 town hall call, officials from the Centers for Medicare & Medicaid Services (“CMS”) stated they will be issuing four new alerts related to the MMSEA Section 111 reporting. These alerts are expected to be posted on the CMS website next week. The Garretson Resolution Group (GRG) will update the settlement community when these alerts are officially posted.
1) Clinical Trials: According to CMS officials, when sponsors of clinical trials make payments for complications or injuries that arise from the clinical trial, it considers such payments to be payments by liability insurance, including self-insurance, and must be reported under Section 111. The appropriate responsible reporting entity (“RRE”) should report the situation as one involving on-going responsibility for medicals (“ORM”), using the date the injury first arose as the date of incident.
2) Periodic Workers’ Compensation and No Fault Payment: This alert addresses situations where the law or plan requires the RRE to make regularly scheduled periodic payments pursuant to statutes for an obligation other than medical expenses (such as lost wages) to or on behalf of the claimant. The RRE does not report these periodic payments for Section 111 purposes as long as the RRE separately assumes responsibility for ORM and reports appropriately under Section 111. If there is a lump sum settlement and periodic payments, then the whole amount will be reported by the RRE as a total payment obligation (“TPOC”).
3) Correction of Feb 24, 2010 CMS Alert – “Who is an RRE?”: According to CMS officials, there was an error in the appendix of the February 24, 2010 alert. CMS has deleted the second paragraph under “Liability Self-Insurance” completely and replaced this language in full. The new language reinforces earlier language and reiterates that if an entity has a program with a deductible, the insurer is responsible for reporting the amount paid within the deductible and any amount in excess of the deductible for Section 111 reporting.
4) Risk Management Write-Offs or Other Actions: CMS officials have clarified that Risk Management write-offs, including a reduction in the amount due on a medical bill, constitutes self-insurance for the purpose of the Medicare Secondary Payer provisions. There are, however, three different treatments within this classification:
• If the entity is a physician, provider or supplier, and they have written-off a portion of a charge to a Medicare beneficiary, as a risk management tool, the physician, provider or supplier is expected to submit a claim to Medicare and show the amount of the write-off. In this case, Medicare’s interest is protected through the billing procedure and no Section 111 reporting is required.
• If the entity is a physician, provider or supplier, and they have provided property of value to a Medicare beneficiary (such as a gift card), and there is evidence or reasonable expectation that the individual has sought or will seek medical treatment as a consequence of the underlying incident giving rise to the risk, then the entity must report the write-off or the value of the property as a TPOC under Section 111. If the property value is less than the reporting threshold, the value does not need to be reported.
• Entities other than physicians, providers or suppliers – CMS officials stated that, in instances where any other entity has reduced its charges or provided property of value as a risk management tool, and there is evidence or reasonable expectation that the individual has sought or will seek medical treatment as a consequence of the underlying incident giving rise to the risk, then the entity must report the write off or the value of the property as TPOC under Section 111. If the value is less than the reporting threshold the value does not need to be reported.
CMS officials also stated that they plan to issue Version 4.0 of the User Guide around July 1, 2010. CMS will send out a notice for the next Mass Tort subcommittee call next week.
The above is a summary of the upcoming to-be-published alerts that CMS officials provided during the town hall call. We will provide additional clarification when the actual alerts are available next week. Please contact us if you have any questions.
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