Effective October 2, 2023, the Fixed Percentage Option will now be available for settlement amounts of up to $10,000 instead of $5,000.
Since its inception on November 7, 2011, CMS has offered the 25% Fixed Percentage Option as a streamlined process available for certain low dollar liability settlements and touts that it “eliminates time and resources typically associated with Medicare Secondary Payer (MSP) recovery process.” The plaintiff may elect the 25% Fixed Percentage Option to satisfy traditional conditional payment obligations if the following criteria are met:
- The liability insurance (including self-insurance) settlement, judgment, award or other payment is related to an alleged physical trauma- based incident and;
- The total settlement is for $5,000 ($10,000 as of 10/2/2023) or less;
- The plaintiff elects the option within the required timeframe and Medicare has not issued a demand letter or other request for reimbursement related to the incident; and
- The plaintiff has not received and does not expect to receive any other settlements, judgments, awards, or other payments related to the incident.
This upcoming increase to the maximum settlement amount criteria is significant and will allow a greater number of liability cases the option of electing the simplified 25% Fixed Percentage Option to resolve conditional payments. Medicare Advantage Plans and Part D Plans follow this same criteria, so this will apply to recovery with those plans as well.
ECS monitors liability Medicare Secondary Payer matters closely, and we will certainly keep you apprised of additional developments around liability demand calculation options in the future. Should you have any questions about the 25% Fixed Percentage Option, please contact Patricia Strang at 678-256-5048 or email@example.com.