New Threshold:

On April 26, 2006, CMS released guidance stating that Medicare Set-Aside proposals with total settlements below $25,000.00 would not be reviewed.  The total settlement value includes compensation for wages (indemnity), attorney fees, future medical expenses, and repayment of conditional payments.  The new threshold replaces the' previous threshold of $10,000.00.  If a proposal is submitted to CMS for a case that falls below the threshold, CMS will send a letter to the submitter that the proposal will not be reviewed.

CMS periodically changes its low-dollar threshold values as a result of changing workload levels.  Parties must realize that the low dollar threshold does not imply a "safe harbor" threshold where no set-aside is required; all parties must still consider Medicare's interests in all appropriate workers' compensation settlements.

Click here to view CMS' release.

Effect on settlements:

The new threshold will result in review of fewer set-aside proposals until this low-dollar threshold is decreased.  The increased threshold could be due to a high number of proposals submitted at the end of last year to meet the January 1, 2006 deadline, after which set-aside proposals were required to include projections for prescription medications.

The new threshold could complicate some settlements.  Workers' compensation boards of some states, including Michigan and Wisconsin, require CMS approval before settlements can be finalized.  However, if a settlement falls below $25,000.00, CMS will not review the set-aside proposal.  In this situation, the safest alternative would be to submit a proposal to CMS and show the letter denying review due to the threshold as proof that the proposal could not be reviewed, and therefore, that CMS approval was an impossibility.

Please contact Henry Kohnlein for further information.

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Medicare Set-Aside accounts can be administered by either the beneficiary or a professional custodian.  While having a beneficiary self-administer an account may avoid administrative costs, self-administration requires diligence and ability on the part of the beneficiary, to adhere to procedures and specific accounting requirements outlined by CMS.  If a beneficiary does not follow proper procedures, Medicare may refuse to pay for future medical care for the beneficiary.

In order to minimize risk and help beneficiaries properly administer their accounts, Protocols^® offers self-administration kits.  The kits provide:

• Answers to frequently asked questions

• Procedures on how to bill medical providers

• Specific information to record for each payment made from the account

• Reporting requirements and contact information for CMS' fiscal intermediary

Providing the self-administration kit will also benefit the insurance carrier by showing that due diligence was taken to help guide the beneficiary in proper administration of the account.

Alternatively, in cases where a beneficiary is unable to self-administer an account, or the amount of the set-aside is significant, Protocols^® will act as a custodian of the account.  By acting as custodian, our knowledgeable administrators will:

• Deposit funds in an FDIC-insured account

• Provide our contact information to the beneficiary and the beneficiary's medical providers for billing purposes

• Ensure that funds are only used for Medicare-covered expenses related to the injury

• Negotiate with medical providers to reach reasonable pricing for necessary services

• Provide required accounting reports to CMS

Click here to learn more about Protocols' services, including our administration services and beyond.

Please contact Geraldine Dauby or Henry M. Kohnlein for further information.

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Are We Meeting Your Expectations?

We would like your feedback regarding our performance.  Since we implemented our new promises in January, we have been striving to meet our 12 business-day turnaround time.  We have also implemented procedures to ensure prompt responses via phone and e-mail.

We aim to provide the best service in the industry.  Do you have any comments or suggestions?  If so, please feel free to contact us -- we're always here to listen.

Please contact Eddie Phillips, for further information.

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Our Staff Spotlight intends to help our clients get to know the people behind Protocols.  This month's spotlight focuses on Kara Martin, Staff Counsel and MSA Consultant. Kara is a Colorado transplant who has practiced law for ten years, after graduating from Indiana University School of Law and obtaining a B.A. in environmental resource management from the University of Texas at Austin. Kara serves on the Board of Directors for the Colorado Fund for People with Disabilities and volunteers as a recreational gymnastics instructor. Kara's free time is spent hiking, jogging, reading, and playing with her German Shepard, Jack.

Please contact Kara Martin for further information.

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