Workers Compensation Medicare Set Aside

What Does CMS Consider When Reviewing WCMSA’s?

As a personal injury attorney, you work hard for your clients. You assess the fine details of their case, you go through the proper channels, and you reach a settlement. While this is a great victory for your client, there’s still more challenging work to do. If the settlement is with your client’s workers compensation insurance and there is an expectation of future medical payments, Medicare must be considered. According to law, Medicare is considered a secondary payer and their interests must be protected when considering future medical payments. Settlement funds must be exhausted before Medicare can start paying. The recommended way for accomplishing that is through the use of a Workers Compensation Medicare Set-Aside (WCMSA).

A WCMSA is a financial agreement in which a portion of the funds from a workers compensation settlement is set aside to pay for future medical expenses. Once this pot of money has been used, Medicare will step in to pay for medical expenses. WCMSA arrangements may be reviewed by the Centers for Medicare & Medicaid (CMS) services for approval. While this is not a required step, it is highly recommended to ensure a proper amount is being allocated and to avoid penalties.

CMS has a list of criteria that they review to determine if a WCMSA is “reasonable” per their requirements. Below is a synopsis of several noteworthy requirements.

  • What is your client’s Medicare entitlement: Certain conditions are more expensive than others. This includes patients 65 and older, those with End-stage Renal Disease, or patients with a disability. Costs associated with these conditions are considered.
  • How severe is the injury or illness: Medical costs differ depending on whether a full or partial recovery is expected.
  • Where does your patient live: Does he or she live in an assisted living center or at home? Who is expected to pay for assisted living or in-home care? These questions are considered by CMS when evaluating a WCMSA arrangement.
  • Is the settlement lump sum or structured?

For more information or to schedule a consultation, please submit our contact request form or call (877) 242-0022.

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.

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"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 don't think I've directly said "thank you" for helping us with Bridgett’s case. We sent the reduced payment to Medicaid and called Bridgett's mom to tell her approximately how much money was going to be left for Bridgett and she broke down over the telephone. Given only $25k of insurance and a $850k medical bill from the hospital she didn't think Bridgett would ever see a penny."

Tom L. Copeland
Jeffrey Meldon & Associates, P.A.

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