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In a memorandum dated August 25, 2008, CMS released updated information regarding several topics: early termination of MSAs, clarification of acceptable rated ages, and details of funding implantable devices.

Early termination of MSAs

The first topic involves early termination of MSAs and replaces CMS’ previous answer of July 11, 2005.  The updated guidance states that a Medicare beneficiary may not have any or all funds in an MSA released under any circumstances.  The example provided with the 2005 guidance involves a claimant whose condition significantly improved after settlement and creation of the MSA, thereby decreasing future medical cost projections.  If future projections decreased by more than 25%, an updated MSA proposal could be submitted to CMS, complete with updated medical records and a statement from a physician certifying that the beneficiary’s medical condition has significantly improved.  With CMS’ approval, any funds from the original MSA in excess of the updated MSA could be released.  However, with the updated guidance, this practice is no longer allowed.

The new guidance states, “Medicare does not pay for an individual’s WC related medical services when that individual received a WC settlement, judgment or award that includes funds for future medical expenses, until all such funds are properly expended” (emphasis added).  Thus, even in a case where a beneficiary is no longer expected to require treatment for which the original MSA was funded, the funds may not be released.

Acceptable Use of Rated Ages

Tied to the update on early MSA termination, CMS provided information on “acceptable use of Rated Ages.”  The new guidance states that rated age quotes must be provided on letterhead of an insurance carrier or settlement broker, and must also be accompanied by a statement that all rated ages obtained on the claimant have been provided.  The guidance seems intended to dissolve the practice of some MSA submitters who would provide only the highest rated age in an effort to reduce the life expectancy of a claimant, thereby reducing the total funding required.  However, the guidance is so broad that it may raise additional questions, for example, whether expired rated age quotes for the claimant must be submitted.

Funding of Implantable Devices

Finally, the guidance addresses the funding of implantable devices (spinal cord stimulators, for example) in MSA proposals.  If the proposal does not include adequate information, as determined by CMS, then CMS may utilize its own cost-funding methodology.  The letter contains a table outlining information required to be deemed adequate, including the device’s manufacturer, model number, cost, pricing from state WC schedule rates, and other information.  The information in the table suggests that CMS may consider the individual needs of a claimant rather than following a broad, flat-rate pricing calculating when determining the appropriateness of an MSA.

To read CMS’ memorandum in its entirety, please click here. 

Please contact Henry Kohnlein or Robert Sagrillo for additional information or questions concerning this topic.

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In July, we announced our streamlined online submission form.  After listening to your suggestions, we've improved our form even further.  Now, you can upload multiple attachments (medical records, rated ages, payment history) simultaneously.  We also increased the allowed file size of each attachment.

Click the link to the right to access our online case submission form.

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2009 Medicare Part-B Premiums

CMS released a press release on September 19, 2008, stating that Medicare Part-B premiums for 2009 will not increase over 2008 levels.  This is the first year since 2000 that Part-B premiums will not increase.  In 2009, the premium will be $96.40 per enrollee.

Click here to read CMS’ full press release.

2009 Medicare Part-D Premiums

Click here for more information on expected Part-D premiums.

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What is the most recent CMS guidance on MSAs?  How will updated guidance affect the MSA process?  What are the latest trends in the MSA industry?  How will CMS' proposed rules affect Medicare beneficiaries, providers, and the MSA process?

In today's electronic, data-driven world, we're  surrounded by streams of never-ending news. The Medicare Set-Aside process combines multiple aspects -- medical, legal, and financial -- complex areas which generate enough news to overwhelm most people trying to stay up to date on relevant issues. To help you identify meaningful information in these myriad sources, we keep our eyes open for news that directly affects the Medicare Set-Aside industry. When we spot an important article, we publish an entry to our blog, summarizing the information and providing a link to the original article.

As far as we know, we provide the only blog devoted solely to Medicare Set-Aside issues.  Numerous blogs exist for medical, legal, and financial news, but none relate their combined application to MSAs.

Staff Spotlight

Our Staff Spotlight intends to help our clients get to know the people behind Protocols.  This month's spotlight focuses on Emily Schmeckpepper, Case Manager. Emily was born and raised in Milwaukee, WI.  After receiving her degree from the University of Iowa she moved to Denver.  In her spare time she enjoys running, hanging out with friends and exploring Denver and Colorado.  She is a huge Green Bay Packers fan and enjoys watching football.  Her three siblings all live in Boston, so she enjoys visiting them and traveling in general. 

Click here to contact Emily.

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