Page 32: of Marine News Magazine (November 2011)

32MNNovember 2011With an MSA, a claimant does not have to spend the entirety of a settle- ment before Medicare will pay for injury-related medical expenses. The set-aside portion acts as the primary coverage for post-settlement treat- ment ? an amount the beneficiary must spend before Medicare will begin paying for the medical care. The CMS also requires an MSA on matters governed by the Federal Employees? Compensation Act, the Longshore and Harbor Workers? Compensation Act and the Federal Coal Mine Health and Safety Act of 1969.CAUTIONARY NOTES One of the major problems with MSAs is that they are not required by federal statute, even in workers? com- pensation cases (where they have become commonplace). Instead, CMS dictates the procedure and rules for MSAs through ?memorandum,? ?guidelines,? and ?FAQs? on its web- site. Without the formal codification of set asides, there are no clear-cut appellate procedures from arbitrary CMS decisions. Although there is nothing in the law or the publishedregulations that require parties to seek preapproval, CMS has indicated that they can impose penalties if the par-ties do not obtain preapproval. CMS suggests that workers? comp claims should not be settled untilCMS can review the settlement and approve the set-aside allocation. CMS approval is only binding if it is a valid approval is generated after full disclo- sure of all reasonably foreseeable future medical needs and complica- tions necessitated by the injury. Per its website, CMS has issued cer- tain ?threshold requirements? for workers? compensation medical set- asides that must be met in order to have CMS consider the plan: The claimant is currently a Medicare beneficiary and the total settlement amount is greater than $25,000; OR The claimant has a ?reason- able expectation? of Medicare enroll- ment within 30 months of the settle-ment date and the anticipated totalsettlement amount for future medical expenses and disability/lost wagesover the life or duration of the settle- ment agreement is expected to be greater than $250,000. In a memorandum issued on July 11, 2005, CMS indicated that thethresholds are ?workload review? thresholds, not ?safe harbor? thresh- olds. The CMS reiterated that, under the Medicare Secondary Payer provi- sions, Medicare is always secondary to workers? compensation and other insurance such as no-fault and liabili-ty insurance. Accordingly, all benefi- ciaries and claimants must considerand protect Medicare?s interest when settling any workers? compensation LEGALOne of the major problems with MSAs is that they are not required by federal statute, even in workers? compen- sation cases (where they have become commonplace). Instead, CMS dictates the procedure and rules for MSAs through ?memorandum,? ?guidelines,? and ?FAQs? on its website. Without the formal codification of set asides, there are no clear-cut appellate procedures from arbitrary CMS decisions. MN#11 (32-49):MN 2011 Layouts 10/27/2011 9:37 AM Page 32