Top 10 Medicare
Compliance Myths
Presented By:
Charles G. Brown, Esq.
Chair, Medicare Compliance Group
Bridget Langer Smith, Esq., MSCC
Vice Chair, Medicare Compliance Group
Katherine S. Gallagher, Esq., MSCC
Associate, Medicare Compliance Group
Medicare
Compliance Myths
Myth #10
• Being Medicare compliant means I only have to
worry about protecting Medicare’s interests with
a Medicare Set-Aside analysis.
Medicare
Compliance Myths
Myth #10
• Wrong. There are actually three areas of
Medicare compliance that must be addressed in
each claim.
 Medicare Conditional Lien
 Medicare Set-Aside
 Section 111 Mandatory Reporting
Medicare
Compliance Myths
Myth #10
• Conditional Lien Satisfaction
 Medicare may pay for a beneficiary’s medical treatment if the
primary plan “has not made or cannot reasonably be
expected to make payment … promptly. Any such payment
by the Secretary shall be conditioned on reimbursements of
the appropriate Trust Fund…” 42 U.S.C. 1395y(b)(2)(B)(i).
 Medicare has a “Super Lien” if it pays for injury-related care
for which a primary payer has responsibility.
Medicare
Compliance Myths
Myth #10
• Conditional Lien Satisfaction
 Failure to pay for injury-related expenses can result in the
following penalties:
1.
2.
3.
CMS can bring suit against any entity involved in the claim,
including a liability insurer, self-insured defendant and attorney.
CMS can seek double damages.
CMS can terminate a plaintiff’s benefits.
Medicare
Compliance Myths
Myth #10
• Medicare Set-Aside Allocation
 The setting aside of funds for the future care of the
claimant which is related to the injury/illness giving
rise to the claim or potential claim.
Medicare
Compliance Myths
Myth #10
• Section 111 Mandatory Reporting
 Requires a primary payer to verify a claimant’s
Medicare status; and
 Reporting a settlement, judgment, award or other
payment for a Medicare-eligible claimant.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #9
• If the claimant is under age 65, I don’t have to
worry about Medicare.
Medicare
Compliance Myths
Myth #9
• Wrong. An individual will be Medicare eligible if
they are:
 65 years of age or older;
 In receipt of Social Security Disability benefits for a
period of 24 months or longer; or
 Suffering from end-stage renal failure.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #8
• If my client or I query a claimant’s Medicare
eligibility status on the CMS web site and the
query is returned stating that there is no record
of a claimant being a Medicare beneficiary, I do
not have to worry about protecting Medicare’s
interests.
Medicare
Compliance Myths
Myth #8
• Wrong. The query system is not infallible.
 The right information needs to be put into the query system
in order to obtain a valid query result.
 Also, in workers’ compensation cases, if the claimant has a
reasonable expectation of Medicare eligibility in the next 30
months, and the amount of the settlement exceeds $250,000,
Medicare’s interests must be protected and a formal
Medicare Set-Aside proposal must be sent to CMS.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #7
• In workers’ compensation cases, if the claimant
is Medicare eligible but the amount of the
settlement is less than $25,000, I do not need to
worry about a Medicare Set-Aside.
Medicare
Compliance Myths
Myth #7
• Wrong. A workers’ compensation Medicare Set-Aside proposal
must be submitted to Medicare in the following situations:
 The claimant is currently Medicare eligible and the total amount of the
settlement is greater than $25,000; or
 The claimant has a reasonable expectation of Medicare enrollment within
the next 30 months of the settlement date and the anticipated total
amount of the settlement for future medical expenses and disability/lost
wages over the life or duration of the settlement agreement is expected to
be greater than $250,000.
Medicare
Compliance Myths
Myth #7
• However, CMS notes on its web site, in pertinent part, as
follows:
“CMS wishes to stress that this is a CMS workload review threshold and
not a substantive dollar or ‘safe harbor’ threshold. Medicare
beneficiaries must still consider Medicare’s interests in all WC cases and
ensure that Medicare is secondary to WC in such cases. In other words,
if the total settlement amount is $25,000 or less, the parties to the
settlement are still required to consider Medicare’s interests. The
recommended method to protect Medicare’s interest is to enter into a
Medicare Set-Aside arrangement…”
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #6
• In workers’ compensation cases, Medicare will
not have a conditional lien because the insurer
has been paying for the claimant’s medical
treatment.
Medicare
Compliance Myths
Myth #6
• Wrong. Medicare can pay for a Medicare beneficiary’s medical
expenses even if they are on workers’ compensation.
Conditional liens can arise in some of the following situations:
 The claim was initially denied and prompt payment was not being made
by the primary payer for the claimant’s medical treatment related to the
injury;
 The provider sends bills directly to Medicare for reimbursement;
 The claimant sends bills directly to Medicare for reimbursement.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #5
• If I am a primary payer under Section 111
Mandatory Reporting and I have an agent, I have
no reporting responsibilities.
Medicare
Compliance Myths
Myth #5
• Wrong. Although an agent can act on a primary payer's behalf
in reporting to Medicare on cases involving Medicare
beneficiaries where there is a settlement, judgment, award or
other payment, primary payers are still responsible for failure to
properly report.
 Primary payers and not agents will be charged $1,000 a day in penalties
per claimant for failure to timely and properly report to Medicare.
 What agents report is just as important as when they report.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #4
• When it comes to Medicare Set-Asides, a legal
analysis of the claim is not necessary as
Medicare only bases its decision on the medical
records provided to it.
Medicare
Compliance Myths
Myth #4
• Wrong. Medicare will review judicial decisions and
orders impacting the claim.
 Legal analysis of the claim can help reduce the Medicare SetAside amount.
 In Medicare’s sample submission under Section 25, it notes
that it will review court/workers’ comp board documents.
 Failure to include a legal analysis of the claim may result in
the inclusion of medical treatment which is not related to the
accepted claim.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #3
• I can wait until the end of the case to obtain
conditional lien information from Medicare.
Medicare
Compliance Myths
Myth #3
• Wrong. Obtaining conditional lien information from
Medicare can take approximately three months or
longer. Instead,
 Get the claimant to sign the appropriate release to obtain
conditional lien information early on in the claim.
 Once conditional lien information is received from Medicare,
audit the information to see if there are charges that should
not be included in the lien.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #2
• If I put settlement language in the release
stating that I protected Medicare’s interests and
have the claimant indemnify me in the event that
Medicare’s interests are not protected, I have
done my due diligence and Medicare cannot
come after me for penalties and fees.
Medicare
Compliance Myths
Myth #2
• Wrong. Medicare is not bound by the parties’
settlement language.
 Putting into the settlement release that you have protected
Medicare’s interests is not enough. Language reflecting how
Medicare’s interests were protected should be contained in
the release.
 Medicare can come after any party involved in the claim who
did not protect its interests regardless of whether the release
places the burden on the claimant.
Medicare
Compliance Myths
Medicare
Compliance Myths
Myth #1
• If I need to find out if a claimant is Medicare
eligible, I can simply ask the claimant or
claimant’s counsel regarding his or her
eligibility status.
Medicare
Compliance Myths
Myth #1
• Wrong. Oftentimes, the status of a Medicare beneficiary’s
entitlement is unknown to both the claimant and claimant’s
counsel.
 Claimant may be awarded Social Security Disability benefits and be entitled
to Medicare and is not aware that they are Medicare eligible or counsel is
not aware of the Medicare eligibility requirements.
 Obtaining the Social Security award/determination is imperative to
confirming a claimant’s Medicare eligibility status.
 Use discovery to your benefit in obtaining this information.
 Create a Medicare file within your workers’ compensation file.
Medicare
Compliance Myths
Case Law Updates
•
•
•
•
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Big R Towing v. David Wayne Benoit, et al.
Zaleppa v. Seiwell
Bradley v. Sebelius
United States v. Stricker, et al.
MARC – AJR 42 and HR 4796
(Medicare Advocacy Recovery Coalition)
QUESTIONS
Thank you for attending.
For further information, please contact the
speakers.
Contact Information
Charles G. Brown
[email protected]
412-392-5204
Bridget Langer Smith
[email protected]
412-392-5624
Katherine S. Gallagher
[email protected]
412-392-5413
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Top 10 Medicare Compliance Myths - National Council of Self Insurers