Employees trying to settle workers compensation claims face a complicated process, especially when the injured employees either are, or soon could be, eligible for Medicare. Normally, settlement discussions in workers’ compensation cases involve protracted discussions between the employee and those tasked with handling their claims. However, if an employee needs Medicare or Medicaid benefits to get required medical care, then the Centers for Medicare and Medicaid Services (CMS) have a financial interest in being reimbursed for those expenses and delays are inevitable. In these cases, CMS requires that some of the settlement money be “set aside” to pay for potential benefits, even if they occur in the future. However, CMS has failed to publish or apply fair and uniform rules for deciding how much of the money it requires or how it will even review settlement proposals.
Having settlement funds set side is not the problem -- CMS has a legitimate interest in protecting the statutory role of Medicare as secondary to other sources of payment for medical care. The problem is that CMS’s review process is unpredictable, inefficient, and slow, often resulting in protracted delays in determining the specific amount needed in reserve to protect Medicare’s interest. In some instances, CMS requires set-asides for future medical expenses that are also inconsistent with the provisions of the claimant’s state workers’ compensation system.
With this lack of procedural clarity, one might think there is a reliable appeals process of CMS decisions in place, but there is not. In fact, the current opportunity to review decisions is at the discretion of CMS and it is very time-consuming. In the meantime, the future financial welfare of tens of thousands of injured workers annually, as well as the interests of employers, insurers and states that administer workers’ compensation laws, are at stake.
Hope is on the horizon, though. On August 2, 2019, Representatives Mike Thompson (D-CA) and George Holding (R-NC) introduced the Coordination of Medicare Payments and Worker’s Compensation Act or the COMP Act (H.R. 4161) to amend Title XVIII of the Social Security Act. The ABA supports this bipartisan bill that would:
- clarify that the amount to be set aside should be based on workers’ compensation law;
- provide a reasonable time frame in which CMS is to review set-aside submissions;
- provide a process for parties to appeal CMS determinations; and
- provide an optional direct payment of set-aside amounts to Medicare.
Common-sense proposals like these also have broad-based support from the trial bar, employers, and the insurance industry. The ABA believes that Congress should pass corrective legislation like this to establish a fair, predictable, and efficient due process for reviewing Medicare set-aside proposals and save all interested parties, including CMS, time and money.
If you would like to know more about this issue or to join us in supporting Representatives Thompson and Holding to advance this legislation, please contact the Governmental Affairs Office at [email protected] or follow us on Twitter @ABAGrassroots.