Tag: CMS Development Letters

CMS Hits ‘Reset’ Button With Workers’ Compensation Review Contractor Procedures and Request for Approval of Zero-Dollar Medicare Set-Aside Amounts

November 2, 2016

In an announcement distributed on November 1, 2016, CMS acknowledged the receipt of many inquiries from the MSP industry regarding procedural changes in the way CMS’s  Workers’ Compensation Review Contractor (WCRC) reviews proposed zero-dollar Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) amounts.  CMS further acknowledged that as a result of these inquiries, it has determined that changes had transpired without prior notification, and that effective immediately, the WCRC will utilize (the) procedures that were previously in effect, further noting that CMS continually evaluates all policy and procedures related to WCMSA reviews and will publish any pending changes when or before they go into effect.

Background

Prior to October, 2016, the Workers’ Compensation Review Contractor’s procedure with Zero Dollar WCMSAs in cases where evidence of a complete denial of the claim was handled as follows:

  1. The carrier’s complete denial would be evidenced by
    • a claim payment history documenting no payments for medical treatment and indemnity and
    • a letter from the adjuster or defense attorney confirming such full denial.
  2. The MSA must be submitted to CMS for approval PRIOR to obtaining a court-approved settlement.

When these conditions were met, the settlement would be recognized as a strict compromise and CMS would issue a determination letter staying no MSA is needed.

While CMS never published this procedure as an official policy in the WCMSA Reference Guide, the policy was exercised regularly and consistently.   As such, Tower, as well as many other MSP companies, incorporated this “policy” into its standard CMS submission procedure for Zero WCMSAs for denied claims.

The October ‘Surprise’

Beginning in October, 2016, with no notice, CMS responses for denied claims took a complete 180 degree turn in terms of the WCRC’s review process.  No longer was the carrier’s evidence of complete denial of the claim sufficient to obtain CMS’s approval of a Zero WCMSA.

When questioned regarding its rationale for this drastic change, CMS noted only that there was a ‘NEW‘ procedure being followed by the WCRC, and in order to obtain approval of a Zero WCMSA one of the following would be required:

  1. A court ruling regarding the compensability of the claim; or,
  2. Treatment records (i.e. a letter from the treating physician) which demonstrate/indicate that no further treatment for the alleged industrial condition(s) will be required.

Unfortunately for the industry, there was no advanced notice of the change in procedure, no documentation of the change and no explanation of CMS’s rationale for making such a drastic change.  We, along with everyone else in our industry, basically learned about this through development letters and undesirable dialogue with WCRC & CMS representatives.

Industry Reaction and CMS’s ‘Reset’

As expected, companies reacted immediately, contacting CMS to request answers, and seeking to determine how WCMSAs currently being reviewed would be handled.  Tower clients with cases pending with CMS were advised to wait to see if the case would be developed or if CMS would follow its original policies.  If developed, the case could be withdrawn.

In an effort to further clarify, NAMSAP (National Alliance of MSA Professionals) also intervened on behalf of its constituent members to confirm why the change was made, to ‘demand’ the courtesy of notice, and to offer its expertise to assist CMS in setting future policy to simplify the process rather than creating confusion and chaos.

As a result of the avalanche of questions, concerns and complaints, CMS has now taken a very positive step back, announcing that it will revert to its original, established procedure for reviewing Zero WCMSA for denied claims until such time as it can analyze, define policy, establish review procedures, communicate to the MSP industry and provide ample notice.

What’s Next?

With today’s announcement that the WCRC will revert to its original procedure for reviewing Zero WCMSAs for denied claims, the industry can return to its internal policies for setting settlement strategy with a clear understanding of the review process that will be executed by CMS’s review contractor when evaluating Zero WCMSAs.

As a reasonable next step, NAMSAP has offered to serve as a resource to CMS to provide industry experiences, to identify the perceived impact of the WCRC’s shift in policy, and to open dialogue regarding both our goals and the unintended consequences of CMS’s shift in review practices.  I trust CMS will consider this offer, and will engage in conversations that will lead to a seamless

Stay tuned….

Related:

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

CMS: Workers’ Compensation Medicare Set Aside Arrangements

Is The Tidal Wave of CMS Development Letters Behind Us?

May 14, 2014

In case you didn’t hear us shouting from the rooftop, Tower MSA Partners (as well as other companies across the MSA industry) was notified Tuesday, May 13, 2014 that full MSA approval had been given for approximately 100 cases, more than 50 of which were in various stages of development request processing.  While this was certainly a welcomed announcement, I believe strongly that it was not an arbitrary decision by CMS, nor was it achieved by a few large companies.  I see this accomplishment as the result of the combined and focused efforts of many in the MSP compliance industry.  

Where Do I Begin?

As many of our clients have become painfully aware, development requests have been a major issue for Tower, as well as every carrier, employer and MSA provider in our industry, since late 2013.  In early January, I discussed this new trend via a blog article (http://www.mspcomplianceblog.com/cms-wcrc-development-letters-essential-information-or-delay-tactic/ ) to explain what we were seeing as a company.  In follow up to the article, I took this information to my industry peers, encouraging their participation to track the trend through my involvement with the Data and Development Committee of NAMSAP (National Alliance of MSA Professionals).   

An Industry Moved to Action

Data capture of development requests began in January with analytics by the DDC for the next 90 days.  At the same time, the NAMSAP Board of Directors asked that I prepare an article to be published in NAMSAP’s national newsletter, and also to help author a letter to be submitted to CMS on behalf of the NAMSAP BOD.  The article’s intent was to communicate the source and impact of development letters among our membership, and to encourage readers to share their experiences in the form of actual data.  The letter to CMS presented aggregated, experiential data to demonstrate the effects of the WCRC’s actions, and to communicate the settlement obstacles being created by this process (not the least of which was the request for HIPAA protected primary care physician medical records). 

Communication Through Data Analytics

Through the efforts of the DDC to summarize the data obtained from multiple companies across our industry, the letter submitted by NAMSAP’s BOD to CMS provided clear evidence of the impact of the actions of the WCRC on settlement initiatives.  We then requested that CMS work with our industry to reestablish a strategy that included only ‘injury related’ medical and pharmacy history, and followed the published standards defined in the March 2013, November 2013 and February 2014 editions of CMS’s own WCMSA Reference Guide as their only criteria to ensure that Medicare’s interests are adequately protected.   

While we cannot confirm that CMS’s recent actions were in response to the initiatives pursued by NAMSAP, or through the efforts of a single company, we certainly believe industry involvement for the benefit of all stakeholders was the right course of action and are thrilled with the outcome.  We are pleased to have been an active participant in this process.

Lessons Learned?

As the MSP compliance partner for employers, TPAs and carriers, our primary responsibility is to prepare and submit Medicare Set Asides that to the best of our knowledge, ability and expertise ensure that Medicare’s interests are adequately protected when settling future medical claims.  From a professional ethics perspective, this means doing what is reasonable on behalf of the claimant.  For Tower, we describe this as, “helping clients balance care, cost and compliance when settling claims that involve Medicare beneficiaries”.       

One of our client’s website taglines reads as follows, “We strive to ensure that injured workers get the right care at the right time—and we focus on getting it done the right way. It’s our commitment.”  I’ve read this quote many times and strongly believe this is the goal of most in our industry….. do what is reasonable.  And in the end, regardless of CMS submission and approval, I believe this will provide adequate evidence of our efforts to protect Medicare.

Looking ahead, we must now prepare our team and our clients for the next wave of CMS submissions.  How do the experiences of the past 6 months impact our internal processes going forward?  Was the development letter barrage truly a ‘ghost hunt’, or is there something to be learned from the WCRC’s actions?   This will be the focus of our attention in the coming weeks.