On February 17th, the Centers for Medicare & Medicaid Services (CMS) held an extended webinar on a number of different Medicare Set Aside topics, including the much-talked-about Section 4.3 of the WCMSA Reference Guide. The webinar was surprisingly glib and at times contradictory; and the general atmosphere was that of an agency digging its heels in, in a number of ways. We recommend CMS think twice again before allowing unexpurgated conversation to masquerade as clarification of written policy. No doubt many will be confused by the result of today’s call.
CMS’ John Jenkins acted as the spokesperson for the agency, and he began by walking through a number of topics where CMS had received previous questions. Most importantly Jenkins walked through the agency’s decision-making process on Section 4.3 of the Reference Guide, as follows:
Section 4.3 Update
Jenkins confirmed that following a number of conversations, as well as written feedback, the agency will provide a written clarification regarding Section 4.3. The substance of the clarification was not discussed, but it seems the clarification will relate to the treatment of claims that do not meet CMS’ workload review thresholds. The bottom line is that CMS did not intend to apply any changes to settlements that do not exceed the applicable workload review threshold.
Throughout the presentation, Jenkins continually referred to a “marker” is placed on a Medicare beneficiary’s common working file (CWF). Where Medicare evaluates and approves a Medicare Set-Aside through it voluntary process, the marker will be set at the total value of the CMS-approved MSA. That is, CMS will not pay for care related to the claimed injury until the beneficiary has appropriately exhausted the total value of the CMS-approved MSA. At the time of permanent exhaustion, CMS will remove the marker from the CWF and make payments going forward for care related to the claimed injury. Jenkins hammered home the idea that the agency needs a copy of the final settlement documents to trigger placement of this marker.
As for cases settled over threshold without participation in the voluntary review process or those that settle at or under threshold, Jenkins indicated that when Medicare becomes aware of a settlement that CMS did not review and approved, it will place a marker at the full value of the settlement (minus procurement costs, attorney fees, and conditional payments). Placement of the marker will mean related claims may be denied until the marker is eliminated at which point Medicare will pay primary. This information, which is not in the recent reference guide update, provides some context to the “non-CMS-approved” products policy.
At the end of the day, Jenkins’ overview of CMS’ decision-making on Section 4.3 yielded a few important points:
While we are pleased CMS has reaffirmed that it cannot, ultimately, deny coverage where the parties have reasonably considered Medicare’s interest, we remain concerned the agency has at no point explained how its policy is not contradicted by regulations. Specifically, 42 CFR 411.46 (b) and (d) do not authorize CMS to automatically deny coverage to beneficiaries simply because they have not submitted to a voluntary MSA review process.
Here are some quick highlights of the first part of the presentation which covered recent non-Section 4.3 questions received by the agency:
This posture and these policies espoused by Jenkins speaking for CMS have led many in the workers’ compensation industry on all sides, to affirmatively reject CMS review of a Medicare Set-Aside. Ironically, it is this “Heads I Win, Tails You Lose” mentality that may have pushed parties away from voluntary CMS review, necessitating Section 4.3. ECS highlighted a number of these obstacles in our January blog post and our webinar of January 26th.
This webinar marks a bit of a turning point. For the better part of two decades, workers’ compensation claimants, carriers, counsel, and (yes) vendors have largely worked cooperatively with CMS and its policy leadership to try to ensure settlement activities track closely with regulations. CMS review and approval has been, and will likely remain, the preferred method to achieve these aims. But at this point based on the tone of webinar and the agency’s posture, it appears CMS a) assumes ill-intent on behalf of all settling parties; b) requires parties to pre-pay for expensive treatment that is highly unlikely to occur; and c) dismisses the very well-considered and legitimate objections settling parties have regarding CMS’ hard-line approach in almost completely rejecting the application of state workers’ compensation law to its review program. These assumptions, bright-line tests, and one-way policies amount – in many cases – to a result that suits the agency just fine, but no one else: “Heads I Win, Tails You Lose.”
ECS will closely monitor Section 4.3 for any changes and / or clarification and will work with our clients and advocacy group partners to ensure CMS has a full understanding of the multitude of reasons parties may decline to submit. Should you have any questions about any of these topics, or if you want to learn more about our response to these changes, contact your local or national account manager or Marty Cassavoy at firstname.lastname@example.org or 781-517-8085Here are some quick highlights of the first part of the presentation which covered recent non-Section 4.3 questions received by the agency: