Synergy Blog

MSPRC Announces Fixed Percentage Option for Resolving Conditional Payments in Low Dollar Settlements

By Jason D. Lazarus, J.D., LL.M., MSCC, CSSC

In a new announcement posted on the MSPRC’s website, there are details about the fixed percentage option for resolving conditional payments where the settlement amount is $5,000 or less.  In those cases, the injury victim can resolve Medicare’s recovery claim by paying Medicare 25% of the total liability settlement.  There are certain requirements that must be met in order to utilize this option which are detailed in the announcement below.  Importantly, when exercising this option the injury victim gives up the right to appeal the fixed payment amount or request a waiver of the recovery.

This option will be available starting on 11/7/11.  The MSPRC’s website will have a full explanation with instructions on how/when to elect the option starting on 11/7.  In the right case, this option may make a lot of sense and speed up the recovery process.  With the SMART act moving through both the House and the Senate, MSP reform appears to be gathering steam.  That coupled with changes being made by the MSPRC may actually make the process a little more palatable.  For now, we have to take a wait and see attitude.

The alert issued by the MSPRC is as follows:

New Fixed Percentage Option For Medicare’s Recovery Claim

The Centers for Medicare & Medicaid Services will be implementing a new and simple fixed percentage option that will be available to certain beneficiaries beginning November 7, 2011. This option is available to beneficiaries who receive certain types of liability insurance (including self-insurance) settlements of $5000 or less.

A beneficiary who elects this option will be able to resolve Medicare’s recovery claim by paying Medicare 25% of his/her total liability insurance settlement instead of using the traditional recovery process. This means that a beneficiary will know what he/she owes and will be able to immediately pay Medicare.

In order to elect this option, the following criteria must be met:

  1. The liability insurance (including self-insurance) settlement is for a physical trauma based injury. (This means that it does not relate to ingestion, exposure, or medical implant), and
  2. The total liability settlement, judgment, award, or other payment is $5000 or less, and
  3. The beneficiary elects the option within the required timeframe and Medicare has not issued a demand letter or other request for reimbursement related to the incident, and
  4. The beneficiary has not received and does not expect to receive any other settlements, judgments, awards, or other payments related to the incident.

A full explanation, including instructions on how and when to elect this option, will be available on this website on November 7, 2011 in the Fixed Percentage Option section of both the Attorney and Beneficiary Toolkits.

Please Note: When a beneficiary elects this option, he/she must understand that as part of choosing the option he/she will be giving up the right to appeal the fixed payment amount or request a waiver of recovery for the fixed payment amount.

TESTIMONIALS

"In my twenty-two year career as a trial lawyer I've handled my share of catastrophic cases and structures, but imagine the complexity of an engaged, unwed mother catastrophically injured during delivery, giving birth to a healthy child, but left in a vegetative state? The issues of guardianship and entitlements of the newborn, the rights of the biological father-fiancé, an out-of-state teenage child of the mother, lifetime maintenance of the mother, as well as the rights of family of the mother, who became her primary care-takers? Synergy systematically managed the seven figure tender of one defendant, the establishment of a Qualified Settlement Fund, a Special Needs Trust, and multiple structures, all the while concurrently maintaining the various entitlements to ancillary services, as well as the remaining litigation. Everything was handled professionally, timely and literally without a hitch. Truly an amazing feat."

Marcus J. Michles II
Michles & Booth

"I just wanted to say thanks to you and the entire Synergy Settlement Services team for helping us put together a series of structured settlements and special needs trusts in two complex cases involving significant recoveries. As always, your accessibility, guidance and expertise on a whole host of post-settlement issues is very much appreciated and valued, particularly with respect to the often confusing topic of Medicare set asides. I look forward to our continued collaboration on cases in the future and am very appreciate of the first rate service your company continues to provide to our clients."

Stephan Le Clainche
Formerly of Babbitt, Johnson, Osborne & Le Clainche

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