On CMS’ Recent Section 111 Alerts

November 12, 2021

Late last month we wrote about a Centers for Medicare & Medicaid Services (CMS) Section 111 reporting alert regarding updates to the “No-Fault Policy Limits” field. Then, late last week, CMS released another alert. This alert – entitled “Alert: Use of the Funding Delayed Beyond TPOC Start Date Field” – goes into some detail about the use of a field that has until now been recommended for use in very narrow circumstances. We are concerned that this alert misinterprets long-standing well-document guidance provided by CMS regarding the “Funding Delayed Beyond TPOC Start Date Field” and would urge CMS to withdraw or at the very least re-write both alerts.

The Latest Alert

In the “Funding Delayed Beyond TPOC Start Date” alert, CMS explains:

“This is a reminder that if funding is delayed after the settlement date reported in Field 80: TPOC Date, in the Claim Input File Detail Record, RREs should provide the actual or estimated date of the funding determination in Field 82: Funding Delayed Beyond TPOC Start Date.

“Some RREs are failing to indicate a Funding Delayed Beyond TPOC Start Date when funds have not yet been released. This has resulted in CMS recovery demands being sent based upon the receipt of a TPOC date and TPOC amount before the funds for the settlement have been received by the beneficiary.”

For good measure, CMS adds:

“In addition, the Funding Delayed Beyond TPOC Start Date is used to ensure an RRE is not found noncompliant with the Section 111 timeliness reporting requirements when a settlement has been made, but the final payment amount has not yet been determined or dispersed.”

Concerns About the Alert

The alert casually explains that it should be a “reminder” that the Funding Delayed Beyond TPOC Start Date filed should be populated “if funding is delayed after the settlement date.”  While the title “Funding Delayed Beyond TPOC Start Date” implies that it should be populated whenever payment is made after the settlement date, that is not the long-standing written guidance from CMS. 

For the last decade, CMS has narrowly defined Funding Delayed Beyond TPOC Start Date to a small, but quite clear series of situations.  Prior guidance has been that the field is to be used in situations such as class action settlements where the identity of the beneficiary or the amount payable to the beneficiary is unknown at the date of the settlement, where the contractual obligation to pay the claim is created (e.g. the settlement or TPOC date).  CMS explains this in a number of different areas, including page 6-21 of chapter 3 of the NGHP User Guide, pages 20-23 of the Computer Based Training on Reporting TPOCs (indicating that “RREs may use this field to indicate the date that the actual specific injured party and specific TPOC Amount were identified”), and the definition of Field 82 which is “If funding is determined after the settlement date (in TPOC Date field), provide actual or estimated date of funding determination.”

The bottom line is that CMS has for several years limited the scope of Funding Delayed Beyond TPOC Start Date to those rare situations where the individual’s identity, or the amount to be paid to that individual, are not known at the time of a settlement.

Yet, with this most recent alert, CMS implies a far grander scale than those prior circumstances.  While it may be the case that a check is cut to the beneficiary or their attorney at the time of the settlement, it is also quite frequent that checks are cut days or even weeks after the settlement.  There are a number of different reasons for this, of course, ranging from simple processing time, to the fulfillment of settlement conditions, or the failure of the plaintiff attorney to timely disburse funds, or any number of other reasons. 

Practical Issues

There are a plethora of very practical concerns with this alert.  First and foremost, how often does CMS really expect the Funding Delayed Beyond TPOC Start Date to be populated?  If a check is cut one day after a settlement, should that field be populated?  Second, the Funding Delayed Beyond TPOC Start Date has always been an optional field.  The idea behind the field has been to allow the RRE to document that there was a delay between the actual settlement and identifying the beneficiary / amount, so as to avoid possible civil penalties.  Medicare has never been concerned about when an actual check is cut, but rather has been concerned about when the obligation to pay the settlement was created. This new alert, if not withdrawn, would effectively make Funding Delayed Beyond TPOC Start Date a “situational” field, meaning it must be populated as long as the settlement date differs from the payment date.

How long is too long?  Is one day enough to populate Funding Delayed Beyond TPOC Start Date?  CMS’ alert is silent as to this question.  The idea that recovery contractor could create a lead for possible civil money penalties for the failure to populate an optional field is extraordinarily troubling, particularly in light of the fact that the recovery contractors lack any real expertise in Section 111 reporting.

What’s Next

For now, ECS is awaiting further guidance from CMS and its Section 111 reporting contractor.  If any changes in training or reporting behavior are ultimately warranted, we will provide further updates. ECS’ MIR Service not only ensures compliance with Section 111 reporting accurately, completely, and timely, but also utilizes business intelligence and automated workflows to eliminate the threat of civil money penalties and Treasury offsets.  Should you have any questions about any of these topics, or if you want to learn more about our tailored MSP compliance solutions contact us at 678-222-5454 or MIRService.Support@examworkscompliance.com.

Marty Cassavoy

Marty Cassavoy

Marty Cassavoy is the Sr. Vice President of MSP Compliance and Business Development at ExamWorks Compliance Solutions. Marty and his team develop solutions for challenges in all areas of Medicare Secondary Payer compliance and across all insurance types. An attorney licensed to practice law in Massachusetts, Marty works out of ExamWorks’ Woburn, Massachusetts office and can be reached at 781-517-8085 or martin.cassavoy@ExamWorksCompliance.com