November CMS News: Mandatory Reporting and Conditional Payment Updates

November 24, 2020

Hand writing What's New?" on a chalkboard for CMS news update

Here’s a recap of recently announced CMS news:

CMS News #1: Medicare Conditional Payment Appeals Guide

In follow-up to its September 2020 webinar on Medicare conditional payment appeals through the Commercial Repayment Center (CRC), CMS converted the slides into an appeals guide.  The guide, which can be found here, provides a breakdown of the Medicare conditional payment appeals process and the bases for appeals.

CMS News #2: Updated MMSEA Section 111 Medicare Secondary Payer Mandatory Reporting Guide

Earlier in November, CMS released a Technical Alert and an updated MMSEA Section 111 Medicare Secondary Payer Mandatory Reporting User Guide, Version 6.1, to announce “Section 111 Edits to no Longer Cause Record to Reject.”

In short, starting April 5, 2021, several error codes will be converted into what CMS calls “soft edits.”  Soft edits are still considered errors by CMS but will not cause the entire record to be rejected.  Examples of such data errors are in fields reporting middle initial of claimant’s name and alleged cause of injury.  The Responsible Reporting Entity (RRE) is still responsible for correcting these errors in the next quarterly file submission.

Additionally, a new soft edit will be added and applied to NGHP Claim Input File Detail Record files when users submit a no-fault insurance claim where the policy limit is less than $1000.00. The input files will be accepted but a new CP13 error will be returned on the response files.

Finally, Claim Input File Detail Records submitted prior to the effective date of the injured party’s entitlement to Medicare will be rejected and returned with a Disposition Code ‘03’ instead of an SP31 error.  As a result, if the purpose of the report was to indicate ongoing responsibility for medicals has been accepted (ORM=Y), then the claim will need to be re-submitted in the next quarterly reporting period (at which point the claimant is presumably entitled to Medicare).

CMS News #3: CMS to Host BCRC Recovery Process Webinar

On Wednesday, December 9, 2020 at 1:00 PM ET, CMS will be hosting a webinar focused on the Medicare Secondary Payer (MSP) recovery process when a Medicare beneficiary receives a settlement, judgment, award, or other payment.  In other words, following its September webinar featuring the CRC, CMS is now highlighting the work of its Benefits Coordination and Recovery Center (BCRC).  The announcement can be found here

Per the announcement:

The primary intended audience is attorneys who represent beneficiaries and other beneficiary representatives.  The BCRC will present a refresher on the beneficiary recovery process, including what functions can be facilitated using the Medicare Secondary Payer Recovery Portal (MSPRP).  Such functions include submission of authorizations, requesting a Final Conditional Payment, and electronic payments. The webinar will also discuss alternative demand calculation options (Self-Calculated Conditional Payment Amount and Fixed Percentage Option), as well as other beneficiary recovery tips and best practices. The presentation will be followed by a question and answer session with participants.

We encourage anyone who is new to Medicare conditional payment recovery through the BCRC or would like, as CMS indicates, a refresher, to attend the webinar. 

If you have any questions regarding these announcements, please contact Tower’s chief compliance officer, Dan Anders, at or 888.331.4941.


CMS to Host Reporting and Medicare Conditional Payment Recovery Town Hall

$750 Medicare Conditional Payment Recovery Threshold Remains for 2021

CMS Introduces Pre-CPNs and Open Debt Reports in Conditional Payment Recovery Process

What Do Medicare Part D, Medicare Set-Asides and Parenting Have in Common?

March 2, 2018

parenting - father hugging two young children

For those who have raised children, or are in the process of doing so, one of our biggest challenges is to instill in our children some sort of positive decision-making paradigm in our children.  You can call it religious values, moral absolutes, grounding, or just plain common sense, but as parents, we set boundaries (rules) from the earliest age, and try to be consistent in our enforcement.  Our children may think we’re just mean, but this is a price we’re willing to pay if it helps establish an internal barometer to use when approached by people, thoughts and ideas that challenge them.

In raising my three children, one of the techniques I used was a simple, banded bracelet with the acronym, “WWJD” that is, What Would Jesus Do? This was a popular phrase in the Bible Belt where we lived.  I asked that they look at the bracelet each time they were faced with an obstacle or asked to do something that didn’t quite feel right.  One afternoon, my son was telling a story about something that happened at his elementary school that caused him to look at his bracelet. I was so pleased when he said he actually looked at it!  He then responded, “Mom, I tried to decide what Jesus would do, but had a little bit of a tough time, so I switched it in my head to “WWMD”, and I knew exactly what Mom would do!”  I couldn’t help laughing, but based on his response to the situation, my simple reinforcement worked.  At the same time, this also reminded me that our actions speak much louder than our words….children will “do as we do” long before they will ”do as we say.”

How does this relate to Medicare Part D and Medicare Set Asides?

Each day, one of my first activities is to review my Google Alerts to look for news about NGHPs, Medicare Secondary Payer issues and opioids.  This morning, the article that drew my attention was from entitled CMS Proposes Opioid Prescribing Limits for Medicare Enrollees.  My first thought in reading the article was that this was great news.

“We are proposing important new actions to reduce seniors’ risk of being addicted to or overdoing it on opioids while still having access to important treatment options,” said Demetrios Kouzoukas, CMS deputy administrator and director of the Center for Medicare.

“We believe these actions will reduce the oversupply of opioids in our communities.”

Key components of the proposal include:

  • Hard formulary levels at pharmacies that would restrict the amount of opioids beneficiaries could receive
  • Establishment of a safety level of 90 morphine mg equivalent (MME)
  • Limiting the # of pills and days supply in an initial prescription for acute pain

According to Kouzoukas, “these are triggers … [that] can prompt conversations between physicians, patients, and plans about appropriate opioid use and prescribing.”

I then realized what CMS was doing.  CMS was setting boundaries to help physicians, patients and plans make better decisions about opioid use…. the same type of boundaries I set for my children so they would make better decisions as adults.  What a great idea!  If physicians, patients and plans (both Medicare and workers’ compensation) can dialogue before Rxs are filled, better decisions about opioids are inevitable and the frequency of opioid addiction will diminish.

So what’s the problem?

Unfortunately, there remains a problem in the world of workers’ compensation and the WCMSA review process.  While I applaud CMS’s effort, there remains a strong disconnect between CMS’s proactive stance on opioid limitations with Medicare Part D and its opioid-friendly review process for WCMSAs.  At the same time, I must also admit to a similar disconnect between what happens with prescription opioids during the life of a workers’ compensation claim and what we are asking CMS to do when reviewing the MSA at settlement time.  Are we asking  CMS to “do as I say,” instead of providing the example of   “do as I do?”

Can we ‘connect the dots’?

After reading the article, I realized that as an MSP compliance company that has integrated opioid triggers into its Pre-MSA Triage and review process since Day #1, Tower now has a new weapon in its arsenal to assist clients to identify pharmacy obstacles as early possible, and to address issues of inappropriate drug use.  By advising clients to establish and enforce “CMS-like” boundaries at Rx fill time, we have the potential to reduce opioid use in workers’ compensation just as CMS seeks to accomplish with Medicare Part D.  Through such efforts, we can reinforce dialogue between physicians, claimants and workers’ compensation plans before the Rx is filled, and hopefully facilitate better decisions about the first opioid Rx.

And as for the disconnect between Medicare Part D and the WCMSA review process, we cannot force CMS to change its WCMSA prescription drug review process.  We can, however, leverage CMS’s expertise to support better outcomes with Medicare beneficiaries, MSAs and settlements by mirroring their Medicare Part D policies and processes within the workers’ compensation PBM model.  In doing so, we provide CMS with a positive example of their own recommendations implemented successfully, and can hopefully encourage them to “do as we do.


So how do we affect change in opioid prescribing habits in workers’ compensation?  It’s as simple as the bracelet I gave my children.  From Day #1 of a claim involving an active or soon to be active Medicare beneficiary, we continually ask the question, “What Would Medicare Do?” and we execute.

CMS Releases Annual Report on CRC Conditional Payment Recovery

September 5, 2017

On 8/30/2017 the Centers for Medicare and Medicaid Services released its annual report on the Commercial Repayment Center’s (CRC) Medicare conditional payment collections for the 2016 fiscal year (10/1/2015 through 9/30/2016). In short, the report documents the CRC identified $243.68 million in conditional payments, collected a net of $106.29 million and returned $88.35 million to the Medicare Trust Fund after subtracting collections costs.

The CRC, which is paid on a contingency basis, has responsibility for Medicare conditional payment recovery efforts involving Group Health Plans and Non-Group Health Plans (NGHP). NGHPs are liability insurance (including self-insurance, no-fault insurance or workers’ compensation). FY 2016 was the first fiscal year in which the CRC had responsibility for recovery of conditional payments from NGHPs, a task previously handled by the Benefits Coordination and Recovery Center (BCRC). Recovery claims involving Medicare beneficiaries remain with the BCRC.

A copy of the report may be found on the CMS website here.

Some observations from the report:

  • CMS does not split out GHP and NGHP recovery information which makes it difficult to ascertain, one, the effect of adding NGHPs to the CRC’s responsibility has had on overall collections and, two, the percentage of overall collections attributable to GHPs versus NGHPs.
  • Despite identifying $243.68 million on conditional payments, the CRC only recovered $117.40 million, shortly under half (48%) of the identified amounts. This may be the result of the provided data only documenting debts that are identified and collected within the fiscal year. The report indicates that collection of FY 2016 identified debts continues into the next fiscal year.
  • Connected to the above observation, it is disappointing that the CRC does not provide a more comprehensive multi-year view of its recovery work. Information such as amounts recovered over the past several years, average turnaround time from demand to repayment, and the above-mentioned GHP vs. NGHP data would be invaluable to understanding the overall program.
  • Provided in the report is a statement indicating amounts returned to the Medicare Trust Fund dropped from $125.05 million in FY 2015 to $88.35 million in FY 2016. CMS attributes the drop to “a decrease in GHP recoveries due in part to the maturity of the mandatory insurer reporting under Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 decreasing the instances of mistaken payments, as well as the CRC’s resolution of pending available recoveries.” This drop is nonetheless surprising given that FY 2016 marked the CRC’s first year recovering from NGHPs!


We do not recommend any changes to your Medicare conditional payment resolution program or process based upon the report. The report merely provides a window into the efforts by the CRC at recovering conditional payments from GHPs and NGHPs.

Federal Court Holds Against Medicare Practice of Over-Inclusive Reimbursement Demands

February 13, 2017

The California Insurance Guarantee Association (CIGA) has prevailed in its lawsuit (Cali. Ins. Guar. Ass’n v. Burwell, No. 2:15-cv-01113-ODW (FFMx), 2017 U.S. Dist. Ct. LEXIS 1681) against the Centers for Medicare and Medicaid Service (CMS) challenging the practice of over-inclusive reimbursement demands by CMS. As a consequence of this ruling from the U.S. District Court for the Central District of California, claimants and employers, have judicial support to dispute charges which contain mixed diagnosis codes, some related to the workers’ compensation injury and some unrelated, in CMS’s conditional payment demands.

A summary of CIGA’s challenge to CMS, CMS’s response to the claim and the Court’s decision is detailed below with a discussion on practical implications of the decision.

CIGA’s Claim Against Medicare

CIGA claimed that CMS’s practice of seeking reimbursement for the full amount of a medical charge despite the charge including mixed diagnosis codes, some related to the workers’ compensation injury and some unrelated, goes beyond CMS’s authority under the Medicare Secondary Payer Act.

By way of background, medical providers include ICD-10 diagnosis codes within billing records that are supposedly associated with the treatment provided. However, it is commonly known that medical providers, especially hospitals, may add any and all diagnoses for which a claimant reports a medical condition, even if such condition is not the subject of the treatment on the bill. For example, a claimant who has a low back injury and seeks treatment at a hospital for a cardiac condition may report on an intake form that he has ongoing low back pain. The hospital may list a low back diagnosis code on the medical bill even though the incurred medical treatment is solely related to the cardiac condition. This is not to say that there may also be situations where actual treatment was received for the work-related injury, but, even then, it may represent only a portion of the overall charge.

As evidence to support its claim, CIGA presented three examples of recovery demands with mixed diagnosis codes. In one demand the Medicare conditional payment charge included a diagnosis code connected to the work-related back and hip injury, but other diagnosis codes relating to diabetes, insulin use and bereavement. In these cases, CMS issued a formal demand letter seeking recovery for the complete charge for both related and unrelated conditions. CIGA disputed on the basis that the charges “did not fall ‘within the coverage of an insurance policy of the insolvent insurer’” under California law.

CMS’s Response

The Court rejected all of CMS defenses as detailed below.

CMS withdrawing the demand is not a sufficient basis to dismiss the case

At some point following the initiation of CIGA’s lawsuit CMS “recalculated” its demands resulting in CMS effectively withdrawing the demands that were the subject of this litigation. CMS claimed that as the demands were withdrawn the case should be dismissed. The court denied the dismissal noting “Indeed, given the timing of the withdrawals (i.e., immediately after a hearing in which the Court made clear that CMS’s practice would not withstand scrutiny), it seems obvious that this is simply a strategic maneuver designed to head off an adverse decision so that CMS can continue its practice in the future.”

CIGA identifying unrelated diagnosis codes is a sufficient basis to shift the burden to Medicare

CMS disputed CIGA’s assertion that identifying the non-work related diagnosis codes is sufficient to shift the burden to Medicare to prove otherwise. The Court disagreed and held that it is sufficient to shift the burden to Medicare to prover otherwise, and further, that CMS never challenged CIGA’s claims that the diagnosis codes were unrelated.

CMS’s claim that the term “item and service” refers to the charge and not the treatment is unsupported

The Medicare Secondary Payer Act provides “a primary plan . . . shall reimburse [Medicare] for any payment made . . . with respect to an item or service if it is demonstrated that such primary plan has or had a responsibility to make payment with respect to such item or service.” CMS regulations (42 CFR 1003.101) further define item or service “Any item, device, medical supply or service provided to a patient which is listed in an itemized claim for program payment or a request for payment . . . .”

CMS asserted the definition of “item or service” for which they are able to recover under their regulations refers to whatever (and how many) medical treatment(s) a provider lumps into a single charge. Not surprisingly, the Court found nothing under the statue nor the intent of Congress in writing the MSP Act to substantiate that “item or service” refers to the listed charge from the medical provider, rather than one medical treatment whether billed as a group with other treatments or listed singly.

CMS is bound by state law in determining whether the WC employer or carrier has responsibility to reimburse Medicare

CMS next argued that it is not bound by state law as state law is preempted under the MSP Act (Preemption refers to the principle that between federal and state law federal law trumps state law). The Court cited with approval a prior federal appellate court decision, Caldera vs. Ins. Co. of the State of Pa. 716 F.3d 861 (5th Cir. 2013) which addressed the question of whether CMS’s ability to recover is limited in anyway by state law. In Caldera the Court found “responsibility to make payment with respect to an item or service is generally a matter of state law.” Accepting then that CMS is held to state law in its ability to recovery, the judge in the present matter went on to cite several California state court decisions finding that a compensation carrier is not responsible for making payment on treatment unrelated to the workers’ compensation injury.

CMS is not entitled to deference in its interpretation of the MSP Act and regulations

The court rejected CMS claim of deference to its interpretation of the MSP Act and regulations since the Court found such an interpretation of CMS’s regulations actually supports CIGA and, further, its arguments conflict with CMS’s own MSP Manual which provides for medical providers to be reimbursed partially by a primary plan and partially by Medicare if work-related medical treatment is provided concurrently with non-work-related treatment.

Court Finds the Real Reason CMS Calculates in this Manner

The Court holds, “At bottom, it is quite clear that the real reason CMS calculates reimbursement demands in the manner that it does is simply because it is too difficult to do otherwise, not because that is what is required (or even permitted) by any statute, regulation, or policy manual.” According to the Court then, CMS must attempt to apportion the charge between covered and non-covered services. It is possible, as the court indicates, that CMS may find apportioning the charge unreasonable. The court further notes that if the charge is apportioned, it takes no position on how CMS should do so in terms of pro rata reimbursement, etc.

Practical Implications of Decision

Whether it is Medicare conditional payment recovery or Workers’ Compensation MSAs, CMS regularly asserts that it is not bound by state law in determining items or service for which it may seek recovery or to be included in the MSA. Further, CMS operates under an assumption that the courts will defer to its interpretation of the MSP Act and relevant regulations. At least in the Medicare conditional payment context, this decision completely refutes such assumptions. This is a well written decision which along with the holding in Caldera (mentioned above), is significant in finding that state law places limits on the extent of MSP conditional payment recovery. We applaud CIGA’s pursuit of this decision.

It should be noted that this is a U.S. District Court decision, not an appellate decision, thus it has limited precedential value for other cases addressing this same issue. Nonetheless, along with the Caldera case, which is an appellate decision, we now have two decisions which limit Medicare recovery. It is unclear at this point whether CMS will appeal the decision to the 9th Circuit Court of Appeals. A decision at that level would provide precedential value for all states within the 9th Circuit and would be on par with the Caldera case which was an appellate decision of the 5th Circuit.

The court does leave a door open for CMS in that CMS can determine whether it is unreasonable to separate a charge between related and unrelated. It is assumed though that CMS would have to provide evidence to support why it cannot reasonably separate the charges.

Tower MSA will utilize this important decision to support disputes of mixed diagnosis code conditional payment charges on behalf of our clients. Whether CMS will agree remains uncertain as this is a lower court decision and the decision itself still gives CMS the ability to determine whether it is reasonable to remove unrelated portions of a charge and how the remaining work-related amount of the charge should be apportioned. Tower MSA will continue to keep you apprised of any developments in this area of Medicare conditional payment recovery. Tower MSA Partners’ Rita Wilson Predicts CMS Re-Review Changes Will Help Payers

January 27, 2017

Tower MSA Partners CEO, Rita Wilson, was recently interviewed by following her participation in a January 24, 2017 “State of MSP” webinar presented by the National Alliance of Medicare Set-Aside Professionals (NAMSAP). asked Rita to comment on CMS’s December 21, 2016 announcement regarding its plans to update its WCMSA re-review process in 2017. This includes expansion of the process to previously approved MSAs where there has been a substantial change in the claimant’s medical condition and the case has not settled (For details see Tower MSA blog on the announcement: CMS Announces Plans for 2017 Expansion of MSA Re-Review Process & New Policy Regarding URs in MSAs)

Rita’s comments to follow:

“CMS will need to establish the parameters for re-review and define ‘substantial changes.’ We expect costly procedures such as surgeries and spinal cord stimulators to be included,” Wilson said. “A WCMSA involving patients who have weaned off expensive polypharmacy regimens could also qualify.”

“Tower’s workflow and decision-tree software application identifies recommended, not-yet-performed procedures and intervenes to address inappropriate treatment prior to submitting an MSA,” Wilson said, “But this could be a game-changer for payers with CMS-approved MSAs that they were unable to settle.”

The full article may be found here.

Removal of SSN from Medicare IDs Detailed in CMS Open Door Forum

January 23, 2017

On January 17, 2017, the Centers for Medicare and Medicaid Services (CMS) held a Special Open Door Forum to detail how the Social Security Number Removal Initiative (SSNRI) impacts the Medicare Secondary Payer (MSP) community. CMS’s explanation is summarized below with Tower MSA’s thoughts on the practical implications of this change.

SSNRI Explained

Presently, Medicare beneficiaries are assigned a Healthcare Insurance Claim Number (HICN) which generally includes either their or their spouses Social Security Number (SSN) followed by a letter, commonly an A or B. For the purpose of reducing identify theft involving SSNs, the Medicare Access and CHIP Reauthorization Act of 2015 included a provision requiring CMS to remove SSNs from all Medicare cards by April 2019.

In accordance with the Act, CMS announced that starting in April 2018 it will begin to issue what will be called Medicare Beneficiary Identifiers (MBIs) to replace the HICNs currently in use. MBIs will be 11-alphanumeric characters in length with letters only in uppercase. The MBIs will be assigned to approximately 60 million current Medicare beneficiaries and 90 million deceased/archived Medicare beneficiaries. CMS targets completion of the assignment of MBIs by April 2019.

CMS advised there will be significant outreach to Medicare beneficiaries, medical providers, and other stakeholders, such as the Medicare Secondary Payer community, prior to implementation of this change.

CMS has a dedicated website regarding the SSNRI which may be found here.

SSNRI Impact on MSP Compliance

In regard to Medicare Secondary Payer compliance processes, the MSP compliance community currently exchanges data with CMS through Section 111 Mandatory Insurer Reporting, the Medicare Secondary Payer Recovery Portal (MSPRP) and the Workers’ Compensation Medicare Set-Aside Portal (WCMSAP). CMS made the following statements concerning the SSNRI’s impact on this exchange of information:

• Fields presently identified as HICN will be retitled “Medicare ID.”
• As the HICN fields currently accept 11 characters there will be no expansion of these fields as a result of the implementation of MIBs.
• SSNs can continue to be used for querying whether a particular claimant is a Medicare beneficiary through the Section 111 Reporting process and for communication through the MSPRP and WCMSAP.
• Use of partial SSNs will continue to be permitted for querying Medicare eligibility.
• After April 2018 the CMS response to a Section 111 query will either provide the HICN or the MBI, depending upon whether the particular Medicare beneficiary has been issued an MBI.
• Outgoing documentation through the MSPRP or WCMSAP will include the HICN or MIB, depending upon what was most recently reported. For example, if an MSA is submitted to CMS for review through the WCMSAP and contains a HICN, then the response from CMS will include the HICN. On the other hand, if an MIB is submitted, then the CMS response will include the MIB.

Treasury Department to No Longer Include Medicare ID

Also announced during the forum is an impending change by the Treasury Department to no longer include the HICN (or the MIB when it becomes active) in its correspondence stemming from Medicare conditional payment recovery. Instead, the Treasury Department will only list the Case Recovery ID that has been assigned to the case by either the Benefits Coordination and Recovery Contractor (BCRC) or the Commercial Repayment Center (CRC). This change is expected to occur before the end of 2017.

Practical Implications

An important takeaway from CMS’s explanation of the SSNRI is that for MSP compliance purposes we can continue to use SSNs in communicating with CMS and its contractors. What we should recognize is that as of April 2018 besides SSNs, claimants may be providing MIBs rather than HICNs. Further, it should be recognized that the Section 111 query process may return an MIB, rather than an HICN, starting in April 2018.

Our Tower MSP Automation Suite will seamlessly transition to recognition and reporting of MBIs for Section 111 Reporting purposes starting in April 2019. We do recommend to our clients that they confirm their internal claims database will be fully capable of recognizing the MBIs when they become active for Medicare beneficiary claimants.

Finally, the Treasury Department’s removal of any Medicare beneficiary identifier from its conditional payment recovery correspondence may present some difficulty to workers’ compensation, liability and no-fault plans in identifying the particular claimant from which the demand stems. Tower MSA will work with our clients to address any uncertainty, but we also recommend to our clients that they work with us to actively resolve Medicare conditional payments on open and settling claims such that these demands never are referred to the Treasury Department.

If you have any questions regarding the SSNRI, please contact Tower MSA Partners Chief Compliance Officer, Dan Anders, at (847) 946-2880 or

CMS MSA Review Expansion to Liability Planned for 2018

January 4, 2017

We are not even a week into 2017, but already have news to share regarding Medicare’s planned expansion of its Workers’ Compensation MSA review process to liability in 2018. In its recently released Request for Proposal for the Workers Compensation Review Contractor (WCRC), the Centers for Medicare and Medicaid Services (CMS) includes an option allowing CMS to expand the responsibilities of the WCRC to review of Liability Medicare Set-Asides (LMSAs) and No-Fault Medicare Set-Asides (NFMSAs) effective July 1, 2018.

The CMS WCRC RFP Solicitation may be viewed here.

Background on CMS Review of MSAs

Since 2001 CMS has had in place an official voluntary review process for Worker’ Compensation Medicare Set-Asides (WCMSAs). A WCMSA, as CMS states, is a “financial agreement that allocates a portion of a workers’ compensation settlement to pay for future medical services related to the workers’ compensation injury.” The purpose of the review then is “to independently price the future Medicare-covered medical services costs related to the WC injury, illness, and/or disease and to price the future Medicare covered prescription drug expenses related to the WC injury, illness and/or disease thereby taking Medicare’s payment interests appropriately into account.”

These WCMSA reviews were initially handled by the CMS Regional Offices spread throughout the country, but eventually transitioned to a centralized WCRC in 2005 (The CMS Regional Offices must still approve the review recommendation of the WCRC before it is released to the WCMSA submitter). CMS’s RFP solicitation for the new WCRC contract indicates the contract is to be awarded by June 30, 2017 with a contract term running for five years from July 1, 2017 to June 30, 2022.

Expectations for Liability MSA Reviews

Presently, CMS allows its 10 Regional Offices to accept voluntary requests for review of LMSAs at each office’s discretion. Some Regional Offices have consistently refused to review any LMSAs while other offices agree to review based upon criteria that seemingly changes over time and bears no indication that it is indeed the official policy of CMS. It appears then that just as it did in 2005 when CMS took the responsibility away from the Regional Offices for reviewing WCMSAs, CMS is now considering centralizing the process of reviewing LMSAs with a contractor, leaving the Regional Offices to only approve of the contractor’s recommendations.

Some may recall CMS launched a prior initiative to establish a formal policy for consideration of future medicals in liability settlements when it issued an Advanced Notice of Proposed Rulemaking in 2012. This initial effort was ultimately withdrawn by CMS in 2014. CMS’s new initiative began with this June 9, 2016 notice on the CMS website:

The Centers for Medicare and Medicaid Services (CMS) is considering expanding its voluntary Medicare Set-Aside Arrangements (MSA) amount review process to include the review of proposed liability insurance (including self-insurance) and no-fault insurance MSA amounts. CMS plans to work closely with the stakeholder community to identify how best to implement this potential expansion. CMS will provide future announcements of the proposal and expects to schedule town hall meetings later this year. Please continue to monitor for additional updates.

No town hall meetings were scheduled in 2016, however, based upon this RFP indicating LMSA reviews will not begin until at least July 1, 2018, CMS has given itself 18 months to develop and implement a formal LMSA review policy. In terms of how many liability settlements such a review process would impact, CMS seems uncertain. A Statement of Work attached to the RFP indicates “reviews could represent as much as 11,000 additional cases (based on all FY2015 NGHP demands), or as little as 800 additional cases annually, depending upon industry response.”

Tower MSA Takeaways

Over the past 15 years, starting with the formalized review of WCMSAs, continuing with the implementation of Section 111 Mandatory Insurer Reporting and recent stepped up efforts at denying injury-related medical care and recovery of conditional payments for medical care related to workers’ compensation, liability and no-fault claims, CMS has expanded its enforcement under the Medicare Secondary Payer Act. It is not surprising then that CMS’s next objective is formalizing a voluntary review process for LMSAs.

It has been our experience that when CMS does implement new policy and procedures it does take a deliberative approach evidenced by the at least 18-month timeframe signaled with this RFP to expand the MSA review process to liability and no-fault. Our expectation then is over the next 18 months or longer, CMS will provide additional announcements concerning the rules and procedures around expansion of the review process.

Tower MSA will be involved in these discussions and will keep you abreast of relevant developments. In the interim, there remain important obligations of parties to liability settlements and no-fault claims under the Medicare Secondary Payer Act. Rest assured that you can rely upon Tower MSA’s team of MSP compliance experts for consultation and expert guidance in liability and no-fault matters.

If you have any questions, please contact Tower MSA Partners, Chief Compliance Officer, Dan Anders, at (847) 946-2880 or

Workcompcentral Highlights Tower MSA CEO Rita Wilson’s “Edge” in MSP Compliance Technology

December 20, 2016

Tower MSA Partners CEO, Rita Wilson, is the subject of a recent Workcompcentral article, Focus on Tech Has Guided MSP Compliance Co. CEOs Career, highlighting how Rita’s career in building better pharmaceutical and worker’s compensation technology systems led her to develop a Medicare Secondary Payer (MSP) technology platform which electronically integrates medical and cost-containment information.

In discussing why the MSP compliance technology platform is a difference maker for Tower MSA, Workcompcentral’s Emily Brill quotes Rita:

Tower MSA has differentiated itself by building out a software system that monitors and shares claim information from beginning to end, integrating medical and cost containment information for “continuity” and to avoid “reinventing the wheel” by scrambling to get information from separate sources.

The article further quotes Rita in explaining how the platform assists Tower MSA in providing MSP compliance services to its clients:

Our technology platform is able to track claim information all the way through, through the conditional payment research process, through the intervention process, through the MSA process. What we did was integrate this information and track it with one software application that allows us to measure the progress each month, and determine when the right time to finalize the MSA.

In understanding the benefits of Rita’s focus on technology in MSP compliance, Ms. Brill spoke to Ann Schnure, the former Vice-President of Risk Management for Macy’s, and also a strong proponent of the use of technology in claims handling, who said of Rita:

Wilson’s focus on technology has always given the CEO an edge.

Learn more about Tower MSA Partners Chief Executive Officer Rita Wilson,  connect with her on LinkedIn and view her blog posts on our MSP Compliance Blog.

To learn more about how Tower MSA Partners’ technology platform can give you an “edge” in Medicare Secondary Payer Compliance please contact Rita Wilson at or 888.331.4941.

Workers’ Compensation Medicare Set-aside Portal (WCMSAP)

November 29, 2011

The Center for Medicare & Medicaid Services (CMS) has completed its Pilot Testing of the Workers’ Compensation Medicare Set-aside Portal (WCMSAP). The CMS will be conducting a Town Hall conference call on November 29, 2011 from 1:00 to 3:00 pm (EST), to introduce this initiative to submitters of proposed Workers’ Compensation Medicare Set-Aside Arrangement (WCMSAs) amounts, and to answer questions regarding the WCMSAP. After the Town Hall conference call, CMS will post the links of the WCMSAP application, and the WCMSAP Computer Base Training (CBT) Modules, on the Workers’ Compensation Medicare Set-aside Portal (WCMSAP) section page “Related Links Outside CMS.”

Please Note: The call in information for the WCMSAP Town Hall teleconference is:
Call in time: 1pm to 3pm
Call In Line: 1-(800) 603-1774
*Conference ID: 29840615

*Participants must use the Conference ID number to be allowed into the call.

Wyden, Portmam Lead Effort to Make Medicare Secondary Payer Program More Efficient, Save Taxpayer Dollars

October 19, 2011

Wyden, Portman Lead Effort to Make Medicare Secondary Payer Program More Efficient, Save Taxpayer Dollars

Bill Makes Common Sense Reforms to Medicare’s Reimbursement Rules to make it easier for the program to collect from Third Party Payers

FOR IMMEDIATE RELEASE: Monday, October 17, 2011
Jeff Sadosky (Portman) | 202-224-5190
Jennifer Hoelzer (Wyden) | 202-224-3789
Jake Thompson (Nelson) | 202-224-8795
David Ward (Burr) | 202-228-1616

WASHINGTON, D.C. – U.S. Senators Ron Wyden (D-Ore.) and Rob Portman (R-Ohio) are leading a bipartisan effort that includes U.S. Senators Ben Nelson (D- Neb.) and Richard Burr (R-N.C.) to make the Medicare Secondary Payer (MSP) Program more efficient and cost effective to taxpayers. The Strengthening Medicare and Repaying Taxpayers (SMART) Act will speed up the rate by which Medicare and its beneficiaries are reimbursed for costs that should be borne by another party.

“Streamlining third party payment fixes some of the bureaucratic requirements that often stand in the way of Medicare being reimbursed for services that they are not supposed to pay for,” Wyden said. “By making the process more efficient, Medicare will be repaid more quickly and more accurately than before and the repayment process will work the way it was designed to work. An easier repayment process is not just good for Medicare and taxpayers, but also for the beneficiary who should be able to settle their claim more quickly.”

“I am pleased to introduce the SMART Act because it will help strengthen and protect Medicare by ensuring greater reliability and efficiency of Medicare reimbursements,” said Portman. “With Washington’s sky high debt and deficit, we need to do everything we can to ensure that entitlement programs such as Medicare are cost effective and working for the very people they were designed to help.”

“The current Medicare Secondary Payment Program is a bureaucratic mess that often leaves everyone involved in the settlement process – from Medicare beneficiaries to small businesses – unsatisfied,” Sen. Nelson said. “The SMART Act will help the program run more efficiently and reduce unneeded uncertainty for all the parties involved.”

“The lack of transparency and inefficiencies with the current Medicare Secondary Payer process illustrates how Washington’s red-tape and regulatory uncertainty can adversely impact seniors and businesses,” Burr said. “In order to get our economy back on track, we simply cannot afford to continue to waste taxpayer dollars by perpetuating the inefficiencies of the current Medicare Secondary Payer system. We can and must do a better job for the seniors and stakeholders depending upon this program to be as transparent and efficient as possible.”

Under the MSP program, if a Medicare beneficiary is injured by a third party and a settlement is pursued as a result of that injury, the third party is responsible for paying for the individual’s medical expenses. If Medicare, now the “secondary payer,” pays any of the costs associated with the injury, it is entitled to reimbursement.

Several problems exist with the reimbursement process under this scenario. Under current law, Medicare does not have a way to disclose the MSP amount before settlement, creating unnecessary uncertainty that makes it hard to settle cases. Second, there are times when Medicare spends more money pursuing an MSP payment than they actually end up receiving in payment. MSP reporting requirements also require beneficiaries to submit sensitive personal information to the settlement company, causing privacy concerns. Finally, there is no clear statute of limitations on all MSP claims.

The SMART Act will address these issues by creating a process that allows CMS to disclose the MSP amount before settlement so it can be factored into the settlement; requiring Medicare to no longer pursue MSP claims that do not cover their own expenses; directing Medicare to establish an alternative method of identifying individuals so that they don’t have to provide sensitive personal information; and setting a three-year statute of limitations for most claims.


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