Workers Comp Zone


The U.S. Senate has called for answers as to why Medicare (the Centers for Medicare Services) is taking so long to act on Medicare set-aside proposals.

Here’s a link to an article on the issue, which was raised by New Jersey Senator Frank Lautenberg: … amp;coll=1

Medicare’s sloth in acting on set-asides has apparently backlogged many workers’ comp settlements in New Jersey.

Attorneys in the trenches in California know that’s true here as well. Medicare rules require that Medicare’s interests be considered when a worker on Medicare (or, under certain time and dollar thresholds, Medicare-eligible) is settling medical treatment in a workers’ comp case.

An MSA requires the worker to spend the agreed upon set-aside amount on his or her medical treatment before submitting bills to Medicare for
work-related treatment.

These Medicare rules generally affect workers with more severe injuries and workers with cases that have spanned several years. There is a complicated relationship between workers’ comp, Social Security disability, and Medicare (not to mention LTD programs). Workers without attorneys or workers with lawyers who don’t understand all of this may get the short end of the stick.

A new industry has sprung up in the past few years; law firms and other companies who analyze cases to determine how much Medicare will require the worker “set aside” out of their settlement. Again, these rules don’t apply to workers who aren’t on (or eligible for) Social Security disability and Medicare.

In theory, the idea of set-asides makes sense. After all, why should the Medicare trust fund pay medical bills that are work-related if the worker has just pocketed a bunch of extra cash by giving up medical in a settlement?

But the delays in MSA approvals have been ridiculous. Like many attorneys, I’ve had cases where we waited over 7 months for CMS action on a submitted set-aside. Insurer reserves are tied up during these delays, so neither side likes the process.

So the Lautenberg amendment is welcome. Assuming the President signs this legislation, CMS has some ‘splainin to do.

Julius Young

Category: Understanding the CA WC system