A Medicare Set-Aside helps protect Medicare’s interest when more than one party is involved in a personal injury claim. Medicare provides the funds for the “qualified medical expenses” and any additional expenses incurred after the depletion of MSA funds. Liability MSA, or LMSA, is an expansion of MSA that includes liability settlements.
LMSAs are still in the nascent stage of utilization, and spent a substantial incubation period in the drafting stage. Knowing when to utilize an LMSA can be tricky. Fortunately, the professionals at Synergy Settlement Services can help steer you in the right direction if LMSAs are a part of your legal case.
Is the Plaintiff a Medicare Beneficiary?
If the plaintiff is indeed a medicare beneficiary, then you have a legal obligation to protect Medicare’s interest in accordance with LMSA regulations. If the plaintiff is not a Medicare beneficiary, you have no statutory commitment to protect Medicare’s interest. The Medicare Secondary Payer Statute (MSP) can be interpreted to only apply in cases a Medicare beneficiary is involved. Currently, there are no regulations that can feasibly negate a liability settlement. Similarly, there are no policy statements for cases involving non-Medicare beneficiaries.
Is the Liability Case Related to an Existing Injury Compensation?
A claim can only be formed on the basis of a single event. Therefore, only one MSA can arise in order to resolve a liability claim without nullifying the underlying workers’ compensation claim. Third party liability insurance earnings are primary to Medicare. In this instance, a workers’ compensation MSA (WCMSA) is required to cover future medical expenses that arise after the third party liability settlement is depleted.
Commutation or Compromise?
Most workers’ compensation claims are settled with commutations, but compromise is utilized for most liability settlements. Liability claims rarely demand a commutation of future medical benefits. However, there are liability claim resolutions with provisions for future medical care when the issue is related specifically to damages.
The Plaintiff’s Treatment
If the plaintiff is released from ongoing medical treatment in the future, then no LMSA is required. Cost shifting to the Medicare Trust Fund is prohibited if the plaintiff has recovered from their injuries. If future medical treatment is required, you must evaluate whether or not the treatment falls within Medicare’s coverage. If further coverage falls outside of Medicare’s scope, no LMSA is required.
If the plaintiff meets all of these requirements and has proven that they protect Medicare’s interest, they are qualified to use a liability MSA.
Are you trying to maximize the return on your client’s personal injury settlement? LMSAs are a new addition to the expanding MSA program, and figuring out how to best utilize them as you represent your client can be challenging. Synergy Settlement Services can help attorneys utilize LMSAs to ease the burden of their client’s personal injury claim.
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Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.