Author: Terry

MSA Amended Reviews – Key to Settlements of Old Dog Legacy Claims

October 26, 2023

Picture of someone reviewing documents of an MSA Amended reviews.

Tower’s Chief Compliance Officer Dan Anders’ enthusiasm for Amended Reviews kept the audience engaged during our recent Premier Webinar: Amended Review MSA Provides Second Bite at the Apple.

Several criteria dictate whether payers can submit an Amended Review, including the fact CMS needed to have approved the first MSA more than 12 months earlier. In addition, there must be a $10,000 or 10% (whichever is higher) difference between the first MSA allocation and the Amended Review MSA.

Our earlier post discussed CMS’s decision to remove the lookback period for Amended Reviews. Previously, we could only use this process if the original MSA had been approved during the last six years.  The removal of the lookback period opened the door for insurers and employers to examine their unsettled legacy claims that had any approved MSA and try to settle the claims.

Dan cautioned attendees not to submit an Amended Review MSA unless the injured worker seemed open to settlement.  “CMS’s change gave payers a second bite at the apple,” Dan said, “But it’s just one more bite, only one opportunity to obtain a new MSA.  You don’t get to eat the whole apple.”

The webinar shared facts and advice about Amended Reviews and highlighted several real case studies, including one where the second MSA amount was much higher than the first.  Some takeaways:

  • Request an MSA report to decide if an Amended Review MSA submission makes sense.
  • An Amended Review is not available until 12 months after CMS approved the first MSAA.
  • There’s no requirement to submit an Amended Review MSA for settlement purposes even if the CMS-approved MSA does not reflect current or future course of care.
  • Make sure all parties are at a stage where settlement is feasible.
  • Obtain medical documentation to support all medical and medication changes from the original MSA.
  • Unlike a regular MSA submission, where CMS requests more information and we can supplement and support the proposal in our response, the Amended Review MSA process offers no opportunity to provide documentation after submission. CMS will review what is provided and make its determination.

Attendees asked great questions:

  • Must the vendor who submitted the original MSA also submit the Amended Review MSA?

No. Tower can handle the Amended Review MSA even if a different vendor handled the original submission.

  • If an MSA was previously submitted for a Re-review, can it be submitted for an Amended Review MSA?

Yes.

  • Does the undertaking of an Amended Review make the previously submitted MSA null and void?

Only if the Amended Review MSA is submitted and approved.  The beauty of CMS-approved MSAs is that they never die.  If you can get the injured person and their attorney to agree, you can use it to settle, regardless of how outdated it is.

Like just about everything else CMS touches, the Amended Review process is complicated, and you can easily blow your one and only chance. Do not try this at home.

Dan is always happy to discuss cases and explore Amended Review and other options with you. Don’t hesitate to email him at Daniel.Anders@TowerMSA.com.

Remember, Tower can create MSA reports to help you decide if you want to pursue an Amended Review MSA. In addition, we’ll review your open claims with high CMS-approved MSAs and select those that could settle with an Amended Review MSA. We can also provide clinical recommendations to determine whether a physician statement, additional medical records or other intervention can result in a lower MSA.

Tower MSA Partners.  Don’t Settle with Anyone Else.

Special Webinar: Your Need-to-Know Guide on Section 111 Reporting Penalties

October 16, 2023

Pctures with details regarding the October 18th Webinar on Section 111 Penalties

CMS recently published its final rule on the imposition of Section 111 Mandatory Insurer Reporting penalties.  While we addressed the specifics of the rule in our article, CMS Section 111 Penalties Rule Focuses on Untimely Reporting, we know that many questions remain.

In a special webinar on October 18 at 2 p.m. ET, Tower’s Chief Compliance Officer, Dan Anders, and Chief Technology Officer, Jesse Shade, will provide your need-to-know guide to these penalties.  Topics will include:

  • Complete analysis of the rule, including criteria, penalty amounts and appeals
  • Examples of reporting situations which will and will not run afoul of the rule
  • Safe harbors from penalties
  • Best practices to mitigate and eliminate the potential for penalties
  • Resources available to Tower Section 111 reporting clients to ensure proper reporting

A Q&A session will follow the presentation, and we encourage you to submit questions when you register. Please click the link below and register today!

Please note there is no CEU credit offered for this webinar.

Register Here

 

 

Tower MSA Partners Launches New Website and Celebrates 12th Anniversary

September 26, 2023

Tower MSA Partners celebrates its 12th anniversary with the launch of a new website focusing on driving claims to settlement.

Tower MSA Partners recently marked our 12 years in business with the rollout of a new, streamlined website that emphasizes our focus on your settlements.  We facilitate claim closure by aggressively seeking savings and making Medicare Secondary Payer (MSP) compliance and Medicare Set-Aside (MSA) prep better, faster and easier.

Working on the new site allowed us to reflect on our differentiators. We don’t try to be all things to all people.  We are singularly focused on MSP compliance, MSA preparation, and going above and beyond to serve our clients.  It’s you, our client partners, and your need to close claims and continually improve your workers’ comp programs that drives us.

This includes our built-for-this-industry MSP Automation Suite, which integrates Section 111 reporting with conditional payment resolution and MSA preparation processes.  Automation saves significant time, reduces errors and allows our client partners to focus on matters other than MSP compliance. And our annual SOC 2 Type II audit confirms the efficiency and effectiveness of our systems and processes.

As great as our tech is, however, at some point, it must give way to human expertise. It’s our legal and clinical specialists who apply their knowledge and experiences to remove barriers to settlement. Our clients appreciate our intuitive technology, but they love the personal service we provide.

As our name says, Tower is your partner. We actively listen to our clients’ goals and desires and make them our own.  Our specialists respond quickly to your questions with clear answers. We consult, advise and stay involved through claim closure and (when appropriate) approval from the Centers for Medicare and Medicaid Services (CMS).

We know that an MSA allocation can determine if a claim can close and we fight for every dollar of savings while we maintain 100% compliance with CMS and state regulations. Tower will also assemble and lead a settlement team to work with injured workers and their attorneys to bring claims to closure.

As we celebrate our 12th anniversary and the launch of a new website, we thank our clients – our partners – for your trust and support.  Many of you have been with us for all 12 years.  We look forward to many more years of innovation and successful settlements.

Please visit our new website, still www.TowerMSA.com, and tell us what you think.

 

Premier Webinar: Amended Review MSA Provides Second Bite at the Apple

CMS now allows any previously approved MSA to have a one-time Amended Review.  This means that CMS will consider a new MSA submission that may be lower or higher than the previously approved MSA. Essentially, it is a second bite at the apple for old MSAs that, for whatever reason–they were too high, or the injured worker was not ready to settle–weren’t utilized for settlement.

Tower is pleased to feature our Chief Compliance Officer, Dan Anders, who on Wednesday, October 4, at 2:00 PM ET, will address the following topics:

  • Criteria for an Amended Review MSA
  • Is an Amended Review MSA required?
  • Documentation to support an Amended Review MSA
  • Examples of Amended Review MSA submissions

Besides Amended Review MSAs, the webinar will also consider how MSA Re-Reviews can reduce MSA amount resulting from CMS counter-highers.

A Q&A session will follow the presentation, and you can provide questions when you register. Please click the link below and register today!

Please note there is no CEU credit offered for this webinar.

Register Here

CMS News Roundup: New Conditional Payment Appeals Guide & Webinar on Section 111 Reporting

May 25, 2023

Red Medicare button on a keyboard to illustrate Medicare conditional payment.

The Centers for Medicare and Medicaid Services (CMS) recently released a how-to guide for appealing Medicare conditional payment demands. The Non-Group Health Plan (NGHP) Applicable Plan Appeals Reference Guide consolidates conditional payment rules and best practices that the agency has issued through webinars, slides and its website.

Section 2.0 gives a breakdown of the appeals levels and explains how to submit an appeal and authorization/letter of authority requirements.  Section 3.0 details what can be appealed and supporting documentation.  Section 4.0 lists additional resources.  Finally, an appendix provides sample letters and model language for applicable plans to appoint recovery agents.

It is important to note that this guide does not cover Conditional Payment Notices (CPNs), which are issued before demand letters to allow the recipient 30 days to dispute the charges.  However, the bases for CPN disputes are the same as those found in Section 3.0.  When the dispute fails or is not timely, a demand letter is issued and the demand letter can be appealed, even with the same arguments used to dispute the CPN.

We appreciate CMS taking the time to draft and release this guide.  It joins the WCMSA Reference Guide and the Section 111 User Guide as critical reference tools for anyone impacted by Medicare Secondary Payer compliance.

CMS Section 111 Non-Group Health Plan (NGHP) Unsolicited Response File Webinar

The Centers for Medicare and Medicaid Services (CMS) recently published a Section 111 reporting webinar notice for a webinar on June 6, 2023 at 1:00 PM ET and states:

CMS will be hosting a webinar regarding the upcoming implementation of the Section 111 NGHP
Unsolicited Response File option. The format will be opening remarks by CMS, a presentation that will include background as well as how to opt in and what to expect, followed by a question and answer session. For questions regarding this topic, prior to the webinar, please utilize the Section 111 Resource Mailbox PL110- 173SEC111-comments@cms.hhs.gov

As of July 2023, Responsible Reporting Entities (RREs) can opt-in to receive a monthly “NGHP Unsolicited Response File” via the Section 111 secure website. Per CMS, the file “will provide critical information about updates to ORM records originally submitted in the last 12 months and allow RREs to either update their internal data or contact the Benefits Coordination & Recovery Center (BCRC) for a correction.”

It is important for an RRE to review and confirm that the changes made by the BCRC and listed in this report are correct.  If not, then the BCRC must be contacted to advise them that the RRE disagrees with the change made by the BCRC.  We encourage anyone involved in managing Section 111 reporting to tune in.  Please note that there is no pre-registration; the link and call-in numbers are on the notice.  You log in shortly before the webinar’s start time.

Related Articles

CMS to Provide RREs with Response File on ORM Record Changes

Premier Webinar: Easy MSA Cost Savings Through Structured Settlements

May 18, 2023

Details for June 7th Webinar on Structured Settlements.

One of the easiest ways to lower the settlement cost is through a structured Medicare Set-Aside. Not only does this reduce the payer’s cost of funding the MSA, but it also provides the injured worker a consistent stream of funds for injury-related medical care over their lifetime.

 On June 7 at 2 pm (EDT) Tower will present an informative session on structured settlements for MSAs. Tower’s Chief Compliance Officer will moderate a special guest panel from Arcadia: Alisa Hofmann, Vice President – Workers’ Compensation and Medicare Practices and Lori Vaughn, Director of Arcadia Client Programs. This hour-long webinar will show how structured MSAs can benefit all stakeholders in a settlement – the injured party, Medicare and the insurance carrier or employer.

Attendees will learn:

  • How to work with a structured settlement provider to incorporate an MSA structure into settlement.
  • The methodology CMS uses to calculate a structured MSA.
  • Rules around converting a CMS-approved lump sum MSA into a structured MSA.
  • The role of a structured settlement broker pre-settlement, during settlement negotiations and post-settlement.

A Q&A session will follow the presentation, and you can provide questions you’d like to have answered when you register. Please click the link below and register today!

Please note that there is no CEU credit offered for this webinar.

Register here.

About Alisa Hofmann:

Alisa is the Vice President of Workers’ Compensation and Medicare Practices at Arcadia Settlements Group and currently works on the Business Development team. She has been handling and overseeing Workers’ Compensation claims for almost three decades with various national carriers.  Alisa obtained her BA in Organizational Communication at Otterbein University. She maintains her adjuster licensing in many states, also holds Life, Health, and Accident Licensing, and many Insurance Accreditations. Alisa has been an active member of the National Structured Settlement Trade Association since 2019, and a member of The MSP Network where she serves on the Professional Administration and Structure-Education Committee.

About Lori Vaughn:

Lori Vaughn has 15+ years of experience in the structured settlement industry and currently oversees structured settlement programs for multiple workers’ compensation and private insurance carrier clients. She leads teams of consultants, case managers, and corporate employees, and is the primary point of contact for the corporate management team for each client. Lori obtained her BS in Kinesiology from California State University, Fresno, and her MS in Kinesiology from California Baptist University. She holds her Life, Health, and Accident licenses in many states and is a member of the National Structured Settlements Trade Association.

The Critical Care Nurses Give MSAs

May 11, 2023

Banner detailing Nurses an d photo of Brittney O'Neal

In the second installment of our quarterly series, “Tower Partners: People Behind the Settlements,” and in celebration of Nurses Week, we spotlight Brittney O’Neal, our Director of Clinical Operations. A nurse, Brittney oversees the team of nurses that produces our Medicare Set-asides (MSAs).

There are so many elements and areas of expertise needed to develop an MSA that is fair, reasonable and compliant.  Or, as we say: optimized. If Tower’s MSA operation was in the shape of a wheel, Brittney would be the hub.  Read on to learn more about her and how our MSAs are written to be effective settlement tools.

  1. What does your position as Director of Clinical Operations entail? And how does your role impact Tower’s clients?

I lead clinical operations which includes MSA writing, quality assurance and our Physician Follow-up service. We have a team of RNs who review the records and write MSA reports.  In so doing, they identify potential treatment and pharmacy problems and make intervention and mitigation strategies. As part of our quality assurance, I review MSA allocations for accuracy and make necessary corrections before they are delivered to our clients.  I also oversee our Physician Follow-up team, which is contacting treating physicians to resolve many of the problems we identified in writing the MSA.

Client communication is vitally important. I’m available to answer questions from clients and prospects and help them put together a plan of action to settle a claim.

  1. What led you to become a nurse? What experiences shaped your professional journey?

I actually started in the pharmacy field, wanting to become a pharmacist. However, one of my mentors told me that the industry was moving away from patient care and that I should look into more of the medical side.

  1. How did you get into MSP compliance and MSAs?

Honestly, by chance. I was a pharmacy technician looking for something different and was fortunate to land an interview with Tower MSA Partners. Kristine Dudley, Tower’s Chief Operating Officer, gave me an opportunity to turn a job into a career.

  1. How does being a nurse help you in your job at Tower?

Being a nurse enables you to better understand the medical material you are reading to in turn prepare an accurate allocation. It guides your approach to researching services and Medicare coverage and the ability to provide intervention strategies.

  1. What part of the job do you find the most rewarding?

I enjoy being able to help our teams and clients navigate the different aspects of this industry.  It’s great to be able to teach and share my knowledge while also learning from others. It is also rewarding to hear from clients who are grateful for the cost-saving measures our team accomplishes and the turn-around time of the reports.

  1. What are some of the things clients ask about most often?

Many questions include whether an MSA or Medical Cost Projection (MCP) is needed, CMS review thresholds, and the Amended Review process. Other questions deal with mitigation tactics to help with cost-saving measures.

  1. How do you facilitate the settlement of claims for Tower clients?

Everything Tower does is designed to facilitate claims settlement.  Carefully reviewing claims for cost drivers, like the wrong body part or duplicative or discontinued drugs. (That pharmacy background really came in handy!)  Turning around reports quickly and recommending and implementing clinical interventions to eliminate unnecessary costs.  Physician Follow-up ensures that treatment changes are properly recorded in medical records and that we have a signed physician statement so CMS can approve our MSA.

  1. Where did you attend school/degrees?

I earned an Associate of Arts degree from Palm Beach State College, then an Associate Degree in Nursing (ADN) from HCI College, also in Palm Beach, Florida.

  1. What do you like best about working for Tower?

The close-knit family atmosphere. No matter what “title” one holds, we all understand the different levels of the workflow and are willing to assist in various areas when needed. Everyone is willing to share their knowledge so that other members can better understand the MSA/CMS process, along with other MSP matters, such as conditional payments and mandatory reporting.

  1. How do you think Tower sets itself apart from companies that sell the same/similar services?

I feel Tower MSA Partners sets itself apart from other companies by promptly being available for our clients to speak with and by having attorneys on staff for consultation. Another way is our free Physician Follow-up service and fast turn-around time on reports.

  1. Where did you grow up, and where do you live now?

I was Born in Long Island, NY, and moved to Palm Beach County, FL as a child.  Now we’re living in Saint Lucie County, FL.

  1. Tell us about your background and family.

Prior to joining this industry, I worked in retail and hospital pharmacy which assisted me with transitioning into the MSA world and going on to pursue my RN. My husband is a Firefighter/Paramedic, and we have three children (12, 9, and 5).

  1. What do you like to do on your time off?

On my off-time, I am a busy wife/mom running around to football practices/games and will soon start softball for my baby girl. I also enjoy weightlifting with my husband and family outings.

Thank you to Brittney and all our Tower nurses for your commitment to providing our clients with the highest level of service.  Happy Nurses Week!

Does Your MSA Program Measure Up?

April 11, 2023

person pointing out metrics on a posterboard to measure Medicare Set Aside

Workers’ comp payers regularly measure the performance of different aspects of their programs. Understanding injury frequency rates, the average cost per claim, timeliness of claims processing, lost-time and return-to-work rates help them identify cost drivers and improve processes. Payers also evaluate the performance of external partners — provider networks, bill review, pharmacy benefit managers, third party administrators, physical therapy networks, home health and case management vendors, etc.

But do they evaluate their Medicare Set-Aside (MSA) programs and vendors – not so much.

Why not? Well, some employers, TPAs, and insurers have their Medicare Secondary Payer (MSP) services integrated into a multi-service contract. As a result, they may assume that MSAs are just part of the process – they are all the same – they take the time they take – and they cost what they cost.

Without metrics to benchmark your performance against some sort of standard, how would you know?

In the case of MSAs, until recently, payers did not have benchmarks to determine what to measure.

In 2022, for the first time, the Centers for Medicare and Medicaid Services (CMS) published some metrics that can give payers a benchmark for comparison. While CMS’ data points are limited, they offer a great place to start.

Average MSA Amount

Providing statistics from fiscal years 2020 through 2022, CMS found the average MSA recommended amount was $84,563.33 in 2020, $80,740.94 in 2021, and $81,571.75 in 2022. (“Recommended” in CMS language means CMS believes the dollar amount of the allocation will be sufficient for the lifetime medical cost of the injury. It’s equivalent to a CMS-approved amount.)

Having captured, benchmarked and analyzed our MSA submitted amounts for more than six years, Tower was excited to see how our outcomes compared to CMS’s published numbers.

One example is the average amount of an MSA. CMS’s average in 2022 was $81,571.75, while the average of Tower’s CMS-approved MSAs was $54,715. That’s nearly $27,000 less than CMS’ number, a whopping 33% less than the CMS’s average amount.

And this didn’t just happen in 2022. The average amounts of Tower’s MSAs were 32% lower in 2021 and 30% lower in 2020.

This is a credit to our powerful and persistent clinical interventions.

Approved Rx Drug Cost

CMS also broke out the cost of prescription drugs on its recommended/approved MSAs. The agency’s average prescription drug cost for 2022 was $20,776, compared to Tower’s $11,405.

Tower’s averages in this category have steadily declined since 2020 when Tower’s average Rx drug cost was $17,941, then $14,079 in 2021. If it seems like we’re boasting a little, we are. Our CEO’s strong background in pharmacy management has paid off over the years.

We have concentrated on pharmacy costs since Tower was founded in 2011. We always examine claims for unnecessary cost drivers like duplicate scripts, discontinued prescriptions, and opportunities to change from brand to generics. And Tower led the charge in identifying inappropriate opioid use on MSAs along with all the prescriptions needed to handle side-effects.  Notably, in 2022, only 15% of Tower’s CMS-approved MSAs included opioids.

We don’t stop at identification, either. Our clinicians work with physicians, gain their agreement to taper injured workers off opioids and follow up to ensure changes happen.

Re-reviews

Tower also doesn’t let CMS get away with errors and misinterpretation of medical records with the MSA submission.  We know our MSAs and we know the rules so that we can confidently challenge CMS when we believe it’s wrong.

While there is no formal appeals process when an MSA comes back higher than proposed, we can submit a re-review request to reduce the MSA.  In 2022 Tower had a 63% success rate at obtaining a partial or full reduction from the CMS MSA counter-higher using the re-review process.

Conditional Payment Disputes and Appeals

When it comes to Medicare conditional payments, in many, many cases, the reimbursement demand is inaccurate. If the client approves, we’ll chase every dollar of savings.  We’re aggressive because we have the records, fee schedules, technology, and CMS response data to fight for our clients. In 2022, our conditional payment disputes and appeals yielded an overall 92% reduction. In 70% of these cases, the demand was reduced to $0.

While CMS did not publish metrics on conditional payments, Tower believes it’s an important point to measure.  There are numerous other areas that we measure and our Chief Compliance Officer Dan Anders is happy to discuss these and work with you on developing metrics for your own program.  Contact him at daniel.anders@towermsa.com.

 

Successful Appeal to CMS ALJ Yields $80K Reduction in Conditional Payments

March 15, 2023

Scrabble tiles spelling Appeal to use for Conditional Payments

In response to a Medicare conditional payment demand, payers can access a five-level appeals process, including a hearing before a Centers for Medicaid and Medicaid Services (CMS) administrative law judge (ALJ). Most conditional payment demand appeals are resolved at the first two levels: redetermination and reconsideration.  However, some are escalated to an ALJ as happened in this case.

ALJ Appeal Success Story

On July 24, 2020, the Commercial Repayment Center (CRC) issued a demand for reimbursement of $149,902.98.  The work injury had aggravated a pre-existing left knee skin graft, resulting in an infection of the left knee.  The payer accepted the aggravation but not the long-term condition of the knee.

Charges on the demand were either completely unrelated to the left knee or for treatment deemed related to the longstanding pre-existing condition of the left knee.  An appeal was filed, and the CRC redetermination decision stated that none of the charges would be removed.

At this point, a second-level appeal was filed with the Qualified Independent Contractor (QIC). CMS contracts with the QIC to provide an independent review apart from the CRC. Its March 26, 2021 reconsideration decision was partially favorable because almost all the charges related to body parts other than the left knee were removed from the demand. The revised demand was $79,489.97, which also included interest.

The next step was an ALJ appeal submitted on May 12, 2021.  It can take two to three years to receive a hearing date, but in this case, it took a little over a year to receive a hearing date set for June 28, 2022.

The difficulty in this appeal is that after some initial treatment in the state where the injury occurred, the injured worker moved to another state where he received further treatment.  The payer never received bills from the out-of-state medical providers whose charges were listed in the conditional payment demand.  Fortunately, we could work with the defense attorney who subpoenaed the medical records.  Unfortunately, upon review, the medical records were unclear on causation.

Nonetheless, we put our best argument forward at the hearing and through our brief to the ALJ that the work-related infection was a temporary aggravation of a long-standing condition of ulcers to both knees.  This was supported by an inconsistent history from the injured worker and medical notes, which implied that the post-injury infection had resolved shortly after the accident.

What is helpful at the ALJ appeal level is that you can speak to the judge, explain your position and answer his or her questions.  This differs from the first two levels of appeal, which come down to submitting the appeal and receiving a decision.

In a September 12, 2022 decision, the ALJ agreed with our position.  As a result, the demand, which by then exceeded $80,000, was reduced to $441.19.

Keys to Appeal Success

Here is what made this appeal successful:

Appeals Deadline Met

All five levels of appeal have specific timeframes for an appeal submission. It is essential to file an appeal by the designated deadline which should also prevent the CRC from referring the debt to the Treasury Department for collection (assuming the debt is not paid during the pendency of the appeal).

In this case, our client had designated Tower as its recovery agent, which means we receive copies of letters and notices the CRC sends this client.  As the recovery agent, we can immediately advise the client of a Conditional Payment Notice or Demand Letter, what it means, and the deadline for action. As a result, all appeals deadlines were met.

Cooperation Between Tower and Client

Successful conditional payment appeals are often based on medical records, Independent Medical Exams and utilization reviews, as well as legal documentation.  It is imperative that the claims professional and defense attorney work with Tower to obtain the documentation necessary to support the appeal.  In this case, the defense attorney’s diligent efforts at subpoenaing and then follow-up with the medical provider resulted in the timely receipt of the out-of-state medical records.

Knowledge and Experience with Conditional Payment

In addition to having supporting documentation, the appeal must provide an acceptable basis for why the charges should be removed from the demand.  Tower’s team of professionals has the knowledge and experience to combine the facts and law to make successful arguments to the CRC and QIC. Additionally, any matter appealed to the ALJ will be handled by Tower’s Chief Compliance Officer, Dan Anders, who has two decades of experience in Medicare Secondary Payer compliance, including prior successful ALJ appeals, as exemplified in this case.

Whatever your conditional payment scenario, we stand ready to assist.  Learn more about our conditional payment services here, where you can also refer a matter for handling.

 

Tower Partners: People Behind the Settlements Interview with Kevin Puckett of KP Underwriting

February 16, 2023

Picture of Kevin Puckett for Tower Partners: People Behind the Settlements

Tower MSA Partners is pleased to launch “Tower Partners: People Behind the Settlements.”  This quarterly series will dig into the elements that go into smooth, cost-effective settlements and introduce Tower’s team members and corporate partners who make them possible.

First up is Kevin Puckett, owner and president of KP Underwriting, who is responsible for assigning a rated age on most of the MSAs we write.  As Kevin explains, a rated age is the statistical age of a person due to their medical conditions.  A person’s actual age may be 60, but their comorbidities and other conditions could cause their rated age to be 65.

Why is this important to the MSA?  Because an MSA is calculated over the injured worker’s life expectancy. A higher rated age that reflects a shorter life expectancy reduces future medical costs. This reduction can be significant, sometimes tens or even hundreds of thousands of dollars.

Case in point: a 67-year-old woman with a rechargeable spinal cord stimulator (SCS) would have required two revisions (one every nine years) over her 18-year life expectancy, in addition to other medical costs. The MSA’s initial allocation was $142,410.64. However, the rated age came back at 72, reducing life expectancy from 18 to 14 years.  This allowed Tower to remove one SCS revision along with other medical costs. The revised MSA was $98,586.35, a $43,824.29 reduction to the allocation.

Now, let’s turn to our rated age expert and partner, Kevin Puckett.

Q & A with Kevin Puckett

What is a rated age? 

A rated age is an adjusted age and reduced life expectancy, that is the expected number of years of life remaining at a given age based on an individual’s medical impairments and the impact they have on their body and life expectancy.  The US Health & Human Services National Vital Statistics life expectancy tables set the baseline for life expectancy determinations.

What is your background in providing rated ages?  What qualifies you to provide this service?

I have been the President and Owner of KP Underwriting, LLC, an independent underwriting company since 2004.  KP Underwriting provides rated ages and modified life expectancies for companies that provide structured settlements, Medicare Set-Asides, and medical cost projections. Our services are also used for settlement purposes and to help set reserves. During my 30+ year career in medical underwriting, I worked with multiple life insurance companies, developing and managing underwriting departments before launching KP Underwriting.  I’ve also written underwriting manuals, audited underwriting departments, and provided expert witness testimony on life expectancy in multiple states and for the Department of Justice.  I earned my BBA in Business Administration with a minor in Biology from Eastern Kentucky University, an Associates designation from the Academy of Life Underwriting, and an FLMI (Fellow, Life Management Institute).

Is KP Underwriting approved to provide rated ages for CMS?

Yes, we’ve been approved since 2006. KP Underwriting is the single largest provider of rated ages in the country, having provided several hundred thousand rated ages to the Centers for Medicare and Medicaid Services (CMS).

What documentation do you require to calculate the rated age?

Medical records should contain two primary categories of records as listed below.  Medical records within the past two years are considered current and have more weight in rated age calculations.

  • Current status of the claimed injury includes:
    • Length of time since injury, permanency of the condition, functional status, stability of treatment, nature of the ongoing treatment.
  • Overall medical status of the individual including:
    • All co-morbidities, personal medical history, pharmaceutical use and related conditions.

Medical records older than two years can be utilized, however, the rated age will normally be more conservative as health history and medical impairments can change drastically over a two-year timeframe or longer.

Can you provide examples of diagnoses that will increase the rated age?

Two conditions can impact the rated age and life expectancy: the injury itself and medical impairments.  Good examples of both are as follows:

  • Injuries
    • Spinal Cord Injuries, head injuries, amputations, burns, chemical exposure, and falls are the most significant. The best thing to consider with injuries is how and if it impacts daily functioning.
  • Medical impairments
    • Most major health impairments will impact the rated age, such as diabetes, stroke, coronary artery disease, obesity, smoking, peripheral artery disease, kidney, colon, and liver diseases, HIV/AIDS, post-covid syndrome, and major respiratory disorders, to name a few. This is a very broad category.  One of the things I cannot stress enough is that medical impairments usually have the biggest impact on the rated age.

Do you solely consider the injury-related diagnoses or both the injury and non-injury-related diagnoses?

The injury and residuals and any medical impairments are both considered in processing the rated age.  We try to let our clients know that not only healthy people get injured.  Medical impairments usually have the biggest impact on rated ages.  In some instances, medical impairments can prevent or delay healing from the injury. For example, diabetes can delay healing in cuts or burns, leading to amputation or slower response to treatment.

What is your typical turnaround time to provide a rated age?

KP Underwriting’s turnaround time is usually 2-3 hours, with rush requests completed within an hour.  All cases that come in before 4 pm EST are completed the same day.  All cases after 4 pm are completed first thing the next business day.

What does your rated age report contain?

 The rated age report sent back to our clients is on KP Underwriting letterhead and contains the name, date of birth, gender, current age and current life expectancy, rated age and rated life expectancy, a brief medical summary of the impairments and injuries used in consideration of the rated age, and the table used in our calculations.  These are tailored to meet our clients’ needs.

How long has KP Underwriting been in business?

KP Underwriting has been in business since 2004. Initially, we prepared rated ages mainly for life companies and structured settlements.  We branched out in 2006 to include rated age services for MSAs.

Do you do all the rated age calculations, or do you have a staff that assists you?

KP Underwriting grew quickly to the point that I needed help to do them.  I currently have a staff of 10-from underwriters to processors- who assist in the rated age process.

If you want more information on KP Underwriting, you can visit their website or contact Kevin at kevinp@kpunderwriting.com or (502) 345-8048.  And if you have a question about a specific MSA or the impact of rated ages on MSAs in general, I am happy to speak with you.  Email Daniel.Anders@TowerMSA.com.