Medicare and Workers' Compensation: Essential Insights
Keeping Medicare informed about a workers' compensation arrangement is essential, especially for those at risk of claim denials or reimbursement obligations. Here's what you need to know:
Workers' compensation provides benefits to employees who've been injured or fallen ill due to their job. The Office of Workers' Compensation Programs (OWCP) under the Department of Labor manages this benefit for federal employees, their families, and certain other entities.
Understanding how workers' compensation may affect Medicare coverage is crucial to avoid complications with medical costs. In many cases, workers' compensation serves as the primary payer for work-related injuries, while Medicare acts as the secondary payer under Medicare's secondary payer policy.
When immediate medical expenses arise before a workers' compensation settlement, Medicare may pay first and recover the expenses from the settlement. To avoid a recovery process, the Centers for Medicare & Medicaid Services (CMS) often monitors the settlement amount for injury- or illness-related medical care. In some cases, Medicare will establish a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds.
Reporting Workers' Compensation Settlements to Medicare
The reporting of a workers' compensation settlement to Medicare depends on the Medicare enrollment status of the claimant and the settlement amount. Key factors include:
- Medicare Enrollment Status: If the claimant is a Medicare beneficiary, reporting is mandatory.
- Settlement Amount: The reporting process involves specifying details such as the WCMSA amount, funding method, and other relevant data points, commonly as part of the Total Payment Obligation to Claimant (TPOC) reporting process.
- Settlement Thresholds: CMS reviews proposed WCMSA amounts based on specific workload review thresholds, which may depend on the settlement amount and the beneficiary's condition.
In addition to workers' comp, a person must report to Medicare if they file a liability or no-fault insurance claim.
Questioons and Answers
You can contact Medicare with questions by phone at 800-MEDICARE (800-633-4227) or through Medicare.gov's live chat during certain hours. For questions about the Medicare recovery process, contact the Benefits Coordination & Recovery Center (BCRC) at 855-798-2627.
A Medicare set-aside is voluntary, but if a Medicare beneficiary wants to set one up, their workers' compensation settlement must exceed $25,000 or $250,000 if they'll be eligible for Medicare within 30 months. Misusing funds from a Medicare set-aside arrangement can result in claim denials and reimbursement obligations to Medicare.
For more resources, visit our Medicare hub.
Takeaway
Staying informed about workers' compensation and its potential impact on Medicare is essential. To avoid complications, be sure to report all relevant settlements to Medicare, and understand the process for setting up a Medicare set-aside arrangement when necessary.
- A Medicare beneficiary must report a workers' compensation settlement if they are enrolled in Medicare, especially when the settlement amount exceeds $25,000 or $250,000 if they'll be eligible for Medicare within 30 months.
- Medicare provides a live chat service on Medicare.gov for answering questions during specific hours, while the Benefits Coordination & Recovery Center (BCRC) can be contacted at 855-798-2627 for inquiries about the Medicare recovery process.
- A Medicare set-aside arrangement (WCMSA) is voluntary, but it can help avoid claim denials and reimbursement obligations to Medicare when misuse of funds is prevented.
- Medicare offers information on various health-and-wellness topics, such as nutrition, therapies-and-treatments, as well as resources related to workers' compensation, healthsystems, and science, on the Medicare hub website.
