Over the past month the Centers for Medicare and Medicaid Services issued two alerts reminding Responsible Reporting Entities (RREs) to make sure data reported through the Section 111 Mandatory Insurer Reporting process is accurate and updated. This appears to be part of an ongoing effort by CMS to avoid unnecessary Medicare conditional payment recovery efforts.

In the first alert, entitled “Reporting of Incorrect No-Fault Policy Limits” CMS states:

Responsible Reporting Entities (RREs) are accountable for ensuring the information included in their Section 111 MMSEA Mandatory Insurer Reporting submissions is accurate. There may be situations where, depending upon state law or the terms of a given policy, the policy limit may vary. In these situations, the reported Policy Limit should reflect the actual amount the RRE has accepted responsibility for at the time the record is submitted or updated. Just as important, if the Section 111 record needs to be corrected to reflect a different Policy Limit, the RRE should update the record as quickly as possible to reflect the new policy limit. For example, if a policy allows for a minimum amount of MedPay coverage and will only allow a higher amount under certain circumstances, and those circumstances are not yet met at the time of reporting, the RRE should report the lower amount. Should the criteria that triggers the higher policy limit be met after that report, the RRE should update the record as soon as possible. Reporting of an incorrect Policy Limit or failing to timely update the record can put the RRE at risk of non-compliance with the Section 111 reporting requirements.

 Inaccurate and/or uncorrected information can impact current Medicare claims payment actions. Inaccurate and/or uncorrected information also places the RRE at risk of recovery actions and increases the burden of proof upon the RRE should it attempt to dispute recovery efforts. Therefore, we advise the RRE to consider contacting their EDI Representative to submit an off-cycle Section 111 report with new policy limit information, rather than wait for their next Section 111 reporting cycle.

Practical Implications

By recommending an “off-cycle” reporting of the new policy limit, CMS is trying to avoid paying medical expenses when a primary payer, in this case, the no-fault carrier, is available to pay. (CMS has a similar recommendation in the Section 111 User Guide for an immediate report of ORM termination to the EDI representative.) If the no-fault plan can pay medical costs directly to the provider, it streamlines the system and eliminates the conditional payment recovery process.

This portion of the alert’s language raises some concern, though: “failing to timely update the record can put the RRE at risk of non-compliance with the Section 111 reporting requirements.”  While CMS has yet to issue final regulations regarding civil monetary penalties for non-compliance with Section 111 reporting requirements, in its proposal, timeliness and accuracy of reporting are factors in determining whether penalties will be imposed.

CMS could clarify this alert by stating that “failing to update the record by the quarterly reporting period following the policy change puts the RRE at risk of non-compliance.” Making failure to report “off-cycle” a basis for penalties adds confusion to a system based on quarterly reporting.  Tower will seek clarification from CMS on this point.

The second alert from CMS, “Use the Funding Delayed Beyond TPOC Start Date Field,” states:

This is a reminder that if funding is delayed after the settlement date reported in Field 80: TPOC Date, in the Claim Input File Detail Record, RREs should provide the actual or estimated date of the funding determination in Field 82: Funding Delayed Beyond TPOC Start Date.

Some RREs are failing to indicate a Funding Delayed Beyond TPOC Start Date when funds have not yet been released. This has resulted in CMS recovery demands being sent based upon the receipt of a TPOC date and TPOC amount before the funds for the settlement have been received by the beneficiary.

 As soon as CMS receives a report of a TPOC Date and corresponding TPOC Amount, CMS begins its recovery process to collect Medicare claims conditionally paid that are covered by the TPOC. The Funding Delayed Beyond TPOC Start Date is used to delay the recovery process so as not to negatively impact the beneficiary prior to receipt of the settlement proceeds.

In addition, the Funding Delayed Beyond TPOC Start Date is used to ensure an RRE is not found noncompliant with the Section 111 timeliness reporting requirements when a settlement has been made, but the final payment amount has not yet been determined or dispersed.

Practical Implications

What is not explained here is that Field 82, per the Section 111 User Guide, is to be used in specific circumstances where the amount the claimant Medicare beneficiary is to be paid is not known at the time the settlement occurs.  This happens most often in mass tort settlements.  Here is an example from the user guide:

• There is a settlement involving an allegedly defective drug.
• The settlement contains or provides a process for subsequently determining who will be paid and how much. Consequently, there will be payment to or on behalf of a particular individual and/or the amount of the settlement, judgment, award, or other payment to or on behalf of that individual is not known as of the TPOC Date.
• Timeliness of MMSEA Section 111 reporting for a particular Medicare beneficiary will be based upon the date there is a determination both that payment will be made to or on behalf of that beneficiary and a determination of the amount of the settlement, judgment, award, or other payment to or on behalf of that beneficiary.
• RREs shall submit the date of the settlement in the TPOC Date field and the date when there is a determination both that payment will be made to or on behalf of that beneficiary and a determination of the amount of the settlement, judgment, award, or other payment to or on behalf of that beneficiary in the corresponding Funding Delayed Beyond TPOC Start Date Field.

While it’s important to remind people to use Field 82 when applicable, the alert causes confusion when it refers to the date settlement funds are “dispersed.”  CMS seems to assume that the date inserted into Field 82 is not only the date that the settlement amount is determined but is the same date the funds are dispersed. However, these dates may be weeks or months apart.

We will seek clarification from CMS but based on CMS’s representation that this is the date it uses to initiate conditional payment recovery against the Medicare beneficiary claimant, we recommend placing the date settlement funds are dispersed in Field 82.

Recognizing that both alerts are somewhat technical, and questions are understandable, feel free to contact me at Daniel.anders@towermsa.com or 888.331.4941.

Thanks to the Provide Accurate Information Directly (PAID) Act effective December 11, 2021, payers will have access to Medicare beneficiary enrollment status in Medicare Part C (Medicare Advantage [MA]) plans or Part D (prescription drug) plans. Enrollment information will be provided through the Section 111 query response file for the past three years.

Historically, workers’ compensation, liability, and no-fault insurance plans have had a difficult time trying to determine a Medicare beneficiary’s enrollment status in such plans as the current query response file only provides a yes or now as to whether the individual is enrolled in Medicare.  However, as close to 40% of Medicare beneficiaries are enrolled in a Part C plan and over 70% are enrolled in a Part D plan, the potential for these plans to seek reimbursement from both payer and/or claimant is significant.

Currently, payers must ask the claimant to voluntarily provide Part C and D plan information which sometimes is never provided or is provided, but incomplete or inaccurate.  Notably, Medicare beneficiaries can change plans every year, meaning in some cases many plans may have reimbursement rights over the course of a claim.

Of course, Medicare already shares Section 111 reporting data with the Part C and D plans, thus giving them the ability to seek reimbursement against a payer who may have no idea the claimant is enrolled in such a plan until they receive a demand for payment.

Great, But Now What? 

Tower’s September 15 “How-to Guide for PAID Act Implementation” webinar explained how the PAID Act affects payers, the differences in recovery processes, and the new reports Tower is creating to make life easier for its clients. If you missed the webinar, contact me at Daniel.Anders@towermsa.com to request the link because there’s a lot of information.

The Section 111 query response data received from the Benefits Coordination & Recovery Center (BCRC) is changing in a big way.  There are 244 new data fields. Parts A, B, C, and D will have the most recent effective dates and termination dates. Part C and D will have most recent and previous plan(s) data, up to three years of data. This will include not only the plan name, but also contract number, enrollment date, termination date, benefit package number and plan address.

Payers can receive and store this data themselves or, for Tower reporting clients, we will store it for our clients who can then obtain the data via Tower’s Section 111 portal.  In other words, it is the payer’s choice whether to receive this information.

Tower will also create PAID Act-specific reports around the new data, accessible through our S111 Management dashboard. These will be:

• Most Recent Medicare Effective and Termination Parts A, B, C, and D
• All Part C data
• All Part D data

Now, the Centers for Medicare and Medicaid Services will only provide the past three years of data, but Tower will store data beyond three years for use by our clients on claims which remain outstanding past that timeframe.

Handling Recovery

Based on the MSP statute and regulations and court decisions the Part C and D plans have a right of recovery against the primary plan and all those who receive payment from that primary plan, such as the claimant and the claimant’s attorney.  In some cases, a claim for reimbursement will be issued by the Part C or D plan without initiating an inquiry. Payers should use the contact information from the Section 111 data to initiate a query with the plan(s) to determine whether they have a reimbursement claim.

There are several differences among CMS recovery through Part A and B (Original Medicare) and Parts C and D recovery.

• Part C and D plans cannot access the Medicare Secondary Payer Recovery Portal (MSPRP)
• Debt collection is not split into two recovery contractors (Commercial Repayment Center (CRC) and BCRC), however, these plans might contract out their recovery efforts.
• The C and D plans also cannot refer debts to the U.S. Treasury Department; they must file suit instead.
• In our experience, Part D and C plans have significantly less unrelated charges on their claims for reimbursement compared to CRC and BCRC.
• Appeal rights are only held by the claimant unlike with Original Medicare conditional payment demands where an appeal right is also held by the payer.

Considering the above, on balance, while identifying the plan and obtaining the reimbursement claim may be a bit more difficult, Part C and D claims for reimbursement tend to be easier to resolve compared to demands from CMS’s recovery contractors.

Guidance for Addressing Part C and D Reimbursement

The following is recommended to properly resolve Part C and D reimbursement claims at time of settlement:

• Identify if the claimant is a Medicare beneficiary and enrolled in a Part C or D Plan
• Identify If the claimant was ever enrolled in traditional Medicare; if so investigate conditional payments with CRC and BCRC
• Investigate with Part C or D plan whether it is seeking reimbursement and obtain a letter itemizing reimbursement claims.
• Negotiate with Part C or D plan to remove charges unrelated to work injury or where there is a reasonable basis to dispute. These plans largely use the same dispute and appeal criteria as CRC/BCRC
• Contact plan at time of settlement to confirm final amount owed
• Resolve case with clear understanding of how plan will be reimbursed

Keep in mind that the PAID Act in no way changes Part C and D reimbursement rights nor puts any additional obligations on these plans that did not already exist prior to its passage.  Nonetheless, access to plan information by payers will undoubtedly lead to a greater emphasis on contact with the plan prior to settlement.  Payers should make use of this data to query the plan and identify and resolve reimbursement claims at the time of settlement.

Whether you’re ready to implement the PAID Act or not, Tower is.  In fact, we’re in front of it, building out our systems, creating reports to add to our year-old S111 Management Dashboard. We’ve been watching pending legislation and posting on it all along, thinking about how it could affect you and planning for the future.

As always, if you have questions about the PAID Act or anything else MSP or MSA related, please contact me at Daniel.Anders@towermsa.com or 847-946-2880.

There’s no better time to let Tower manage your Section 111 reporting. Contact Hany Abdelsayed for the details.   Hany Abdelsayed, hany.abdelsayed@towermsa.com, (916) 878-8062.