Payer Compliance Update Medicare Secondary Payer Compliance Update Presented by: Heather Schwartz Sanderson, Esq. Chief Legal Officer, Franco Signor LLC

Agenda Workers’ Compensation Medicare Set-Asides (WCMSAs)/Non-Submit Alternatives Liability Medicare Set-Asides (LMSAs) and No-Fault Medicare Set-Asides (NFMSAs) Traditional Conditional Payments and Medicare Advantage Plan (MAP)/Part D Conditional Payments Provide Accurate Information Directly (PAID) Act Medicaid Liens

WCMSAs / Non-Submit Alternatives What is a WCMSA and its intended purpose? Protect future cost shifting to Medicare CMS Submission Thresholds Class I Class II Why do parties submit a WCMSA to CMS for approval? It has become the industry standard Finality in settlement Medicare indicates there are “no safe harbors”

WCMSAs / Non-Submit Alternatives (cont.) Flaws in the CMS submission and approval process No due process/appeals process if dissatisfied with determination CMS over allocates opioids and prescription drugs No use of evidence based medicine Is it required to submit a WCMSA to CMS? No, CMS submission is voluntary Parties may settle with a non-submitted MSA

LMSAs/NFMSAs Review process coming for LMSAs? CMS continues to indicate that a formal voluntary process for LMSAs/NFMSAs will be created. Guidance to medical providers Indicates that CMS is laying the groundwork for providers to bill the Workers’ Compensation Medicare Set-Aside (WCMSA)/LMSA/NFMSA instead of billing Medicare. Alerts issued CMS seeking stakeholder feedback in the near future on proposed review process for LMSAs/NFMSAs. Workers’ Compensation Review Contractor (WCRC) Request for Proposal (RFP)- Includes requirement for new contractor to review LMSAs/NFMSAs potentially beginning July 1, 2018. Here we are in 2019- is a process coming?

LMSAs/NFMSAs (cont.) Serious concerns among the industry LMSAs/NFMSAs will cause delay in settlement and increase costs. Many have questioned CMS’ legal ability to require a LMSA/NFMSA. It is unclear how CMS would review an LMSA Factors such as comparative negligence, policy limits, and other issues present in liability and no-fault claims that are not present in workers’ compensation claims.

Traditional, Medicare Advantage Plan (MAP) and Part D Conditional Payments Understand the difference between Medicare Part A, B, C & D Medicare Parts A and B- Traditional Medicare Medicare Part C- Medicare Advantage Medicare Part D- Prescription Drugs MAPs are gaining double damages’ rights in several jurisdictions- 3rd and 11th Circuit are the only established Circuits with case law in favor of MAPs having a double damages right to recovery.

Traditional, Medicare Advantage Plan (MAP) and Part D Conditional Payments (cont.) Strategic filing Humana and other MAPs are strategically filing in other jurisdictions to establish precedent. MSP Recovery LLC An entity solely formed to file private cause of actions on behalf of MAPs, is filing class actions nationwide against nearly every insurance carrier. Best Practices Establish Best Practices immediately for the 6 states at the very least. All other states, an inquiry should at least be made for MAP/Part D enrollment.

PAID Act Why the concern? CMS has this information Primary plans do not have a centralized methodology to determine a claimant’s Medicare Part C/D, or Medicaid enrollment. CMS has this information A legislative fix is needed to force CMS to provide this data to Responsible Reporting Entities (RREs). SPARC (Provide Accurate Information Directly) Act Plan is to be re-introduced in 2019 and will gain momentum.

Medicaid Murray/Ryan Budget Deal Current political climate Went into effect on October 1st allowing Medicaid agencies to recover 100% of dollars expended (Medicaid is no longer limited to the medical portion of the settlement). Current political climate Current CMS Administrator, Seema Verma, is in favor of block grants to states which would inevitably provide less dollars to states for their Medicaid agencies. Proactively determine Medicaid enrollment Notify the state Medicaid agency of claim/settlement (if required under state law).

Questions

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