True to form, the Centers for Medicare & Medicaid Services (CMS) released another Alert during a holiday weekend. This time, on the day before Thanksgiving Day, CMS announced that the Total Payment Obligation to the Claimant (TPOC) and Conditional Payment recovery thresholds for Workers’ Compensation, Liability, and No-Fault insurance claims remain unchanged at $750. These thresholds have remained at $750 for four years running, dating back to January 2017, meaning no changes are needed to industry practices.
For physical trauma Liability claims, all Workers’ Compensation claims, and all No-Fault claims, the occurrence of a TPOC Amount and Date do not need to be reported if the amount is $750 or less. Keep in mind that Liability claims involving ingestion, exposure and implantation have no TPOC threshold, meaning that all TPOCs must be reported irrespective of amount.
Additionally, CMS and its contractors will not pursue recovery on claims where the Conditional Payments are $750 or less. This dollar amount is the result of CMS analyzing the resources taken to pursue recovery efforts and the cost-effectiveness of those activities, as required by the SMART Act. While the average cost of collection efforts has decreased $50 over the past four years (from $368 in 2016 to $318 in 2020), CMS has chosen to maintain status quo with the existing $750 thresholds.