December 01, 2012

ABA urges CBO scoring for secondary payer bill

The ABA urged the House Ways and Means Committee this month to request a scoring by the Congressional Budget Office for H.R. 5284, a bill that addresses confusion and uncertainty in situations where Medicare is a secondary rather than the primary payer of medical expenses related to workplace injuries.

Scoring projects the budgetary impact of legislation as well as the bill’s year-by-year effects on revenues or outlays.

In a Dec. 5 letter to committee Chairman Dave Camp (R-Mich.) and Ranking Member Sander Levin (D-Mich.), ABA Governmental Affairs Director Thomas M. Susman said that the Medicare secondary payer legislation is expected to raise revenue or be cost neutral. He emphasized that H.R. 5284 enjoys support from a group of rarely aligned interests, including injured workers, insurance groups, trial attorneys, self-insurers, and large and small employers.

Congress passed the Medicare Secondary Payer Act in 1980 as a way to control the expanding costs of the Medicare program by identifying specific conditions under which Medicare is a secondary payer when another source of funds for medical treatment is available. In 2001, the Centers for Medicare and Medicaid Services (CMS) determined that a Medicare Set-Aside Arrangement (MSA), which creates a trust account setting aside a portion of a settlement for future medical expenses, is the recommended method of protecting Medicare’s future.

Workers’ compensation settlements that overlap with Medicare coverage currently are subject to lengthy cumbersome review by CMS to ascertain appropriate set-aide coverage amounts for medical expenses.

Susman said the legislation, sponsored by Reps. Dave Reichert (R-Wash.) and Mike Thompson (D-Calif.), incorporates principles that reflect ABA policy by establishing clear criteria for when a set-aside may be reviewed by CMS, creating a time frame within which CMS must provide information regarding conditional payments, and establishing an appeal procedure if the parties dispute the CMS ruling regarding the allocation of settlement proceeds.

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