Denied Claim Zero MSAs: Still Available, but Put Through the Wringer by CMS

April 28, 2017

In October 2016, CMS made an unannounced policy change which effectively eliminated the ability to obtain a Zero MSA approval from CMS based upon a complete denial of the claim, without a supporting judicial decision. After only a couple weeks, CMS withdrew this policy change and again allowed for approval of Zero MSAs based solely upon a complete claim denial. Nonetheless, these Zero MSAs reviews are placed through the proverbial wringer by CMS such that it is important to understand when a case meets the criteria for a Denied Claim Zero MSA and the documentation required to obtain CMS approval.

Denied Claim Zero MSA Approval Criteria: A Denied Claim Zero MSA (or Legal Zero MSA) approval from CMS is available when the claim has been completely denied with no medical or indemnity payments having been made with the exception of medical payments made for non-treatment purposes such as IMEs, case management and medical records copies (Note, in certain limited situations a Zero MSA may be approved with medical treatment payments having been made. Please consult with Tower MSA).

Importantly, CMS will not approve a Denied Claim Zero MSA if settlement is made final and/or a settlement payment or any medical or indemnity payment is made prior to CMS approval of the Zero MSA. A tentative or agreed to settlement is allowable, but please do not make the settlement final or make indemnity or medical payments prior to CMS approval of the Zero MSA.

If the case meets this criteria, then CMS has strict documentation requirements which must be adhered to or the Zero MSA will be rejected. Notably, since the policy change and rollback occurred in October 2016, CMS has added a requirement to provide claim reserve documentation. The requirement for claim reserve documentation, as well as all other supporting documentation, is detailed below.

Denied Claim Zero MSA documentation requirements: The following documents are required by CMS to obtain approval of a Zero MSA based upon a complete claim denial:

1. Claim Payment History

  • A claim payment history printout, even if blank, representing payments since the inception of the claim. All payments must be itemized.
  • Printout must be divided into categories for medical, indemnity and expenses with subtotals for each category and a grand total listed. Print or run date listed on the printout.
  • Date range for listed payments – Must be since inception of claim.
  • If the Claim Payment History does not meet the above requirements, then the following rules apply:
  • Provide a copy of the available Claim Payment History with the following statement inserted, signed and dated in the document:
    This document provides a complete representation of all payments made on the life of the claim (including medical of $0* and indemnity of $0)

    Signed:
    Date:

    *If medical payments were made, provide the invoices or reports, i.e. IME report, associated with those payments and see below Financial Detail and Denial Letter requirement.

  • Letter providing an explanation why a Claim Payment History meeting CMS’s requirements is not available (See below Financial Detail and Denial Letter)
  • 2. Claim Reserves

  • A Claim Reserves printout divided into categories for medical, indemnity and expenses with subtotals for each category and a grand total.
  • Print or run date listed on the printout.
  • If there is a legal argument for claiming the reserve information is privileged then the legal argument, including citations to statute or case law must be provided along with a copy of a redacted (reserve information blacked out) version of the Claim Reserves printout.
  • If no reserves were placed on the claim, then a statement regarding the same.
  • 3. Draft or final settlement documents and court orders or rulings or a statement that no such documents exist
    (See below Financial Detail and Denial Letter).

    4. First Report of Injury or a statement that no such document exists (See below Financial Detail and Denial Letter).

    5. Financial Detail and Denial Letter – Tower MSA will provide draft letter upon request for submission of the Zero MSA to CMS

  • A statement indicating the claim was completely or fully denied with no medical or indemnity payments having been made.
  • If medical payments have been made for non-treatment purposes, i.e. IME, case management, medical records requests, then if the Claim Payment History does not properly explain the purpose of these payments, then provide an explanation for the payments.
  • If the available Claim Payment History does not meet the requirements under #1, then state that the carrier’s claim system does not have the ability to provide a Claim Payment History printout with the information requested by CMS, i.e. print date, subtotals for medical, indemnity and expenses.
  • If Claim Payment History did not meet the requirements under #1, then insert the requested information into the letter, i.e.list categories for medical, indemnity and expenses with subtotals for each category and a grand total.
  • If there are no draft or final settlement documents and no court orders or rulings, then a statement regarding the same.
  • If there is no First Report of Injury, then a statement regarding the same.
  • Letter must be placed on letterhead and hand signed.

  • 6. Consent to Release form executed by claimant

    While CMS places Zero MSA submissions based upon a complete denial through the wringer, these approvals remain available for workers’ compensation cases meeting the applicable criteria. Please contact Tower MSA Partners at referrals@towermsa.com or (888) 331-4941 to refer a claim meeting these requirements or for further consultation.

    Why is CMS Requesting Medical Records Which Are Not in My File and How Do I Respond?

    April 21, 2017

    Tower MSA understands the frustration when following submission of a Workers’ Compensation Medicare Set-Aside (WCMSA) to the Centers for Medicare and Medicaid Services (CMS) shortly thereafter you receive a request for additional medical records and prescription history which you thought was already provided! Indeed, in most cases you have provided all the relevant documents from your claim file, but what CMS is requesting are medical records and prescription histories outside of your claim file.

    So why then is CMS requesting documentation for treatment and medications not even paid on the claim? What if the claimant has not even treated for the work injury in the last two calendar years, paid on the claim or not? What is the proper response to these CMS medical records requests?

    CMS Rules Require Submission of All Injury Related Medical Records

    CMS does not allow the employer or carrier to limit medical records in the MSA submission solely to records the employer, carrier or MSA submitter deem related to the work injury. Accordingly, CMS requires the production of records as defined in Section 10.7 of the CMS WCMSA Reference Guide which states as follows:

    All medical records from all treating physicians for the last two years of treatment related to the claim, even if the WC carrier has not paid for the treatment and even if the treatment was long ago (emphasis added). Remember, CMS needs medical records for the last two years of treatment, which may not be within the last two calendar years. . .

    . . . If the claimant has not been treated by any doctor for any reason within the last two calendar years, CMS generally needs all treating physicians to state when the last two years of treatment for any reason occurred. The treating physicians must also state, in writing, the specific condition/injury the claimant was last treated for, and any related therapy.

    In response to these rules, an employer or carrier may argue that if the treatment was not paid on the claim then it should not be considered “related.” However, CMS defines related as any treatment occurring to the alleged injured body part or condition notwithstanding who pays for the treatment. For example, a carrier employer accepts responsibility for a shoulder injury in February 2015, but following a favorable IME report disputes ongoing medical care starting in November 2016. Assuming the claimant continued medical care for the shoulder injury, CMS will want to review those records.

    That is not to say the employer or carrier cannot dispute the causal relatedness of the treatment in these medical records. While the IME itself will be insufficient on its own to dispute the care, a judicial decision after a hearing on the merits or a statement from the treating physician in which it is found that the ongoing treatment is unrelated to the claimed work injury, will in most cases be sufficient to exclude such care from the MSA.

    Response Scenarios to CMS Requests for Medical Records

    Below are several common scenarios in which CMS will likely request additional medical records, whether in the claim file or not, and how anticipation of this request can be addressed prior to submission of the MSA to CMS.

    Scenario #1 – Open-ended medical care without ongoing treatment

    Client provides Tower MSA with the last two years of medical records which match up with the dates of service in the claim payment history. The last available medical record for a 2/12/2015 date of service reports the claimant is to follow-up in three months. There is no indication in the claim file that the claimant sought further medical care post 2/12/2015. Once it is verified that the claimant indeed sought no further work-related medical care then through Tower MSA’s Physician Follow-up service, we will obtain a statement from the doctor confirming the last date of service and that all prescription medications, if any, were discontinued.

    Scenario #2 – Open-ended medical care with ongoing treatment

    Client provides Tower MSA with the last two years of medical records which match up with the dates of serve in the claim payment history. The last available medical record from a 2/12/2015 date of service reports the claimant is to follow-up in three months. There is no indication in the claim file that the claimant sought further medical care for the work injury. Communication with the claimant reveals though that the claimant has been receiving treatment which is related to the work injury although not paid on the claim. The requested medical records and prescription history (likely from the claimant’s pharmacy) will need to be obtained and submitted, although relevant legal defenses to the inclusion of care in the MSA based upon these records may be submitted as well.

    Scenario #3 – Availability of Medical-Legal Reports versus treatment records

    While this can occur in any jurisdiction (usually in the form of IME reports), California claims tend to have a greater prevalence of medical records containing QME, PQME or AME reports versus required treatment records. While such reports may be relevant to the MSA, they cannot make-up the sole basis of support for the allocation. Besides these type of medical-legal reports, we must provide CMS the treatment records upon which these reports are based.

    Scenario #4 – Medical Records Containing Inconsistencies

    There are situations where Tower MSA is provided updated medical records and prescription history but the records contain inconsistencies. Submitting an MSA to CMS with inconsistencies will either result in CMS issuing a Development Letter requesting additional documentation or CMS including treatments or medications that are actually no longer necessary.

    For example, in one case referred to Tower MSA the medical records documented the treating physician giving a sample and prescribing Pennsaid 1.5%, an extremely expensive medication. On the other hand, the prescription history showed the Pennsaid had never been filled. We alerted the client and through our Physician Follow-up service was able to obtain a report from the physician confirming that as the trial of Pennsaid did not effectively manage the pain, it had been discontinued – $970,355 in MSA savings

    In another example of a matter referred to Tower MSA, the medical records from two years before documented mention of a spinal cord stimulator as a potential treatment option for the claimant. The more recent medical records made no mention of a spinal cord stimulator as a potential treatment option Through Tower MSA’s Physician Follow-up service we were able to obtain a statement from the current treating physician that the SCS no longer is part of the claimant’s treatment plan – $187,822 in MSA savings.

    Tower MSA Partners Works with Our Clients to Effectively Address Medical Records Issues Prior to CMS Submission

    Tower MSA Partners’ MSA development process is uniquely designed to identify issues which may result in unnecessary medical care being included in the MSA and avoidance of post MSA submission Development Letters requesting additional medical records and prescription histories:

    Prior to MSA report completion: Prior to completion of the MSA report we review the claim payment history and request from the client any dates of service listed on the history for which medical records are missing from the file. This is insures we start with a complete record of all treatment paid on the claim.

    Post MSA report completion: Upon delivery of the MSA report we will advise our client of additional medical records likely to be requested if the MSA is submitted to CMS along with inconsistencies within the medical records and prescription histories and other opportunities to limit the MSA allocation.

    With client approval Tower MSA’s Physician Follow-up service will obtain supplemental statements from treating physician(s) confirming last date of service, discontinuation of medications, clarification of ongoing medication use and whether certain treatments remain options for the claimant, i.e. spinal cord stimulator. The result is an MSA which will be expeditiously approved by CMS and an allocation that accurately reflects the claimant’s future work-related medical care.

    Tower’s Physician Follow-Up service is provided at no charge when initiated as part of the MSA and CMS submission process.

    For further information on Tower MSA Partners services please contact us at (888) 331-4941.