Why does the MSP industry use the phrase “consider and protect” when discussing Medicare’s interest?

June 29, 2017

Recently you may have seen some back and forth about the plain language of the Medicare Secondary Payer (MSP) Statute found at 42 USC 1395y(b). The discussion focused on why the industry uses the phrase “consider or protect” when discussing Medicare compliance when those two words are found nowhere in the plain language of the statute and regulations (42 CFR 411 et seq.).

What seems to have been lost in this discussion is policy guidance from the Centers for Medicare and Medicaid (CMS) by way of its memoranda. The “consider and protect” ideas sprouted from a series of memos that streamed out of CMS starting with the 2001 Patel memo. When the memoranda are read along with the statue and the regulations, many recognize that injury claims involving Medicare beneficiaries and those individuals with a reasonable expectation of Medicare eligibility should evidence the fact the parties reasonably and in good faith considered Medicare’s interest and even perhaps protected it.

Generally the MSP Compliance industry understands that there is a good chance the CMS memoranda would receive “Chevron deference” if challenged in court. Chevron deference stems from a US Supreme Court ruling in a case called Chevron v. the Natural Resources Defence Council (NRDC). It presumes that the rules and regulations promulgated by an administrative agency will be deemed controlling unless they are found to be “arbitrary, capricious, or manifestly contrary to the statute.”

While the CMS memoranda are not formal rules or regulations, those subject to the MSP Statute generally assume the memos, if challenged, will be given Chevron deference and found to be controlling since they are not on their face arbitrary, capricious, or manifestly contrary to the statute. The decision whether to do an MSA remains 100% voluntary as does the submission of any MSA to CMS for review (assuming the threshold is met for WCMSAs; note there is no threshold for LMSAs at this time).

Reasonable minds can and do differ on how best to consider and protect Medicare’s future interest. What we ultimately do know is that cost-shifting is prohibited. Given that cost-shifting is prohibited, how best should one ensure that doesn’t happen?

ExamWorks Compliance Solutions works with clients at all risk levels to help consider Medicare’s interest and protect Medicare’s interest, if warranted. ExamWorks Compliance Solutions is willing to partner every step of the way and at all risk levels to help you find a way to reasonably and in good faith comply with the MSP statute, regulations, and memoranda with whatever product makes the most sense to account for reasonably expected future medical care.