6 Ways Post-Settlement Professional Administrators Can Provide Peace of Mind

Injured workers with long-standing claims and ongoing medical concerns are often hesitant to settle their case because they fear running out of money too soon and potentially having no one to turn to for help. Increasingly, injured workers and their advocates are finding they can alleviate both concerns — by working with a professional administrator.

 

 

Professional Administration

 

Professional administrators are not new to the workers’ compensation system; however, few injured workers know or understand what they do and how they can help. Meanwhile, a growing number of claim settlements now involve a professional administrator.

 

Recent advancements in pricing and capabilities have made administration a more cost-effective and elegant solution. Those who go with a professional administrator find they have more freedom of choice than under the workers’ compensation system, but can still take advantage of expert assistance and discounted prices for their medical needs.

 

Companies that excel in professional administration have large medical networks to offer discounts — for medical office visits, medications and durable medical equipment. The individuals that settle their cases, also known as “members,” save an estimated 20-30% on their annual medical care. These organizations also offer personal expertise to help navigate the complex healthcare system. Members can reap these benefits, without giving up precious dollars.

 

What members do give up are the restrictions of the workers’ compensation system; such as

 

  • Utilization review
  • Being required to see providers in inconvenient locations
  • Difficulty contacting someone who understands their case and needs

 

Professional administrators also handle government regulations for Medicare, Medicaid, and other government benefit programs. They take care of all reporting requirements.

 

 

Control of Funds

 

Some professional administrators are now using technology to simplify and assist members to get the benefit of expert oversight while maintaining full control over their money. Here’s how it works:

 

The professional administrator provides the member with a healthcare savings card that is used to pay for all medical care. The injured party or “member” receives their settlement money and deposits it in their own personal bank. Then, the member places the debit card for that account on file with the administrator for use for medical expenses. All subsequent medical bills go directly to the professional administrator, which applies its discounts and pays the bills from the debit card on file. There are no co-pays or out-of-pocket expenses involved.

 

However, the member has complete control over the account at all times. He or she can deposit and withdraw funds at any time. Activity on the account can be tracked by the professional administrator and available for viewing at any time by the member — including the discounts generated by using the card.

 

This newer online system can be easily accessed through smartphones and other electronic devices to see activity on the account. They also provide notifications, about advanced trending, for example, to monitor the account spending over a specific time period.

 

The platform functions similar to a clearinghouse by managing transactions and ensuring money is available to support any charges. Support personnel is available to answer any questions.

 

Some of the country’s largest companies offer the service at settlement to give their employees a better experience and to show goodwill. The healthcare savings card is just the latest service to simplify the injured worker’s post-settlement experience.

 

 

What to Look For

 

As with any industry, some professional administrators are better able to assist members than others. When looking at these companies, here are some of the issues to consider:

 

  1. Experience. The professional administrator should be comprised of people with solid backgrounds in all aspects of insurance, finance, and healthcare.
  2. Large networks. The more robust the medical networks, the better the savings for the injured party. The company should be contracted with multiple providers, pharmacies, and durable medical equipment companies throughout the country.
  3. Price comparisons. Ideally, the company should be able to provide a comparison report showing the retail prices for the injured worker’s specific medications and the discounts currently offered through the professional administrator.
  4. Medicare expertise. Since a majority of workers’ compensation settlements involve Medicare Set-Asides, the professional administrator should be able to competently handle all reporting aspects required by the Centers for Medicare and Medicaid Services.
  5. 24-Hour Help. The company should provide easy access to support personnel who can help coordinate medical care and recommend qualified providers.
  6. Expansive Resource Outreach. Each injured worker has different needs, and the professional administrator should have access to a wide network of people and organizations that can assist.

 

 

Summary

 

Injured workers seeking to settle their claims now have an option to get the support they need to manage their funds and comply with various regulations. A competent professional administrator can ensure these injured workers move forward with their lives.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

 

Effectively Use Mediation to Settle More Workers’ Compensation Claims

The use of mediation as a means of effective alternative dispute resolution in workers’ compensation is gaining momentum across the United States.  Given the highly litigious nature of many workers’ compensation claims, mediation promotes the involvement in all interested stakeholders and allows parties to resolve their claims in a timely manner.

 

Members of the claims management team who fail to prepare for mediation will not see its benefits.  Anyone seeking to promote efficiency and reduce workers’ compensation costs must take proactive action in order to make the most of a mediation session.

 

 

Effective Use of the Mediation Process

 

Alternative dispute resolution in workers’ compensation systems can be used even if it is not required or endorsed by a state industrial commission.  The process starts when the employee and employer/insurer agree to use a neutral third party to help resolve their dispute.  When agreeing to do so, it is important to invest time and effort in reaching a settlement.  Terminating the mediation session at the first sign of tension is never helpful.

 

Preparing for medication is key.  All interested stakeholders must take the following steps:

 

  • Evaluate the claim and set realistic expectations for settlement. While issues such as “pain and suffering” are important to any injury-related case, this is something that does not add value to the underlying claim;

 

  • All interested stakeholders must be present and willing to work hard toward settlement. This includes being physically present at the mediation settlement and willing to sometimes work through lunch or late into the day.  Be prepared for downtime and keeping occupied and focused; and

 

  • Include interested parties and settlement services in the mediation session. Effectively settling a workers’ compensation claim involves many complex issues and considerations. Leverage the following services to prior to and during mediation:

 

– Defense attorney: Attorneys must play an active role in managing the emotional nature of settlement negotiations, and are a key relationship to leverage early in the claim.

 

– Settlement Consultant: A settlement consultant can assist the parties to understand the different options available, help identify the true wants and needs of both sides, and provide a negotiation tool to help bridge the gap of negotiations and bring about a successful resolution to the case.

 

– Professional Administrator: A professional administration handles many of the administrative tasks on behalf of the injured worker once they’ve settled their Workers’ Compensation claim and can provide piece of mind to address many of the injured worker’s fears and concerns prior to settlement.

 

 

Be Prepared; Be Willing to Compromise

 

Preparing for mediation is key for all involved parties.  Steps members of the claims management team must take include:

 

  • Receiving an updated case analysis from your settlement team. Request that this be provided in advance so one can receive clarification, properly set reserves and provide adequate settlement authority;

 

  • Communicate with defense counsel and settlement services well in advance of mediation and develop a strategy. Make sure a confidential mediation statement is also sent to the mediator in advance.  This statement should outline the claims, defenses, and evaluation of the case.  It may also be helpful to provide a statement as to how you see the issues being resolve; and

 

  • Be realistic and willing to compromise. In a settlement via mediation, all parties are able to have a role in resolving a case and be heard.  It is important that there be a willingness to find a happy medium – a “win” for everyone.

 

 

Effectively Working with the Mediator

 

It is important to work with your settlement team to select the right mediator.  This is because each mediator has their own style.

 

The style of a mediator may also be important depending on the unique facts of a case.  Some of these could include matters involving a pro se claimant, a claimant who is a recent immigrant (cultural sensitivity is an important consideration), someone who is older (or younger) or one who has had many prior workers’ compensation cases.

 

It is also important to be open and honest with a mediator.  If there is information a party does not want to be disclosed to the other side, make sure you are clear when sharing this information.  Never lie and do not be evasive.

 

 

Conclusions

 

Mediation is a great tool to use when settling workers’ compensation cases. In many instances, it provides for fast and effective resolution to reduce program costs.  When using this tool, it is important to prepare for and be willing to compromise.  It is also important to work with the mediator in an effective manner.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center.

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

8 Steps to Obtain Faster, More Accurate Medicare Set-Asides

8 Steps to Obtain Faster, More Accurate Medicare Set-AsidesMedicare Set-asides can take time, money and valuable resources in the claim settlement process. Partnering with experts makes both financial and logistical sense to get your claims settled that much faster, and for the lowest cost.

 

Taking a proactive approach and truly engaging with your MSP vendor will help limit the costs and time to create the best possible MSA.

 

 

Action Steps

 

Strengthening your relationship with your MSP provider requires you to become involved, rather than taking a back seat and expecting the vendor to do it all. Here are actions that will help:

 

 

  1. Provide Complete Information

 

An accurate, defensible MSA report is dependent on the availability of all pertinent information and documentation. You don’t want to delay the process by having to revise the report because of missing information. While the MSA company may be able to access your claim system for relevant records, there may be older records and legal documents in a different system. At the time of referral the following information should be provided:

 

  • Complete referral form
  • Claim payment history
  • Two years of medical records for each
  • Accepted and denied body parts
  • Multiple dates of injury settling
  • Court orders and rulings
  • Depositions

 

 

  1. Read and Heed the Report

 

In addition to a projected dollar amount, the MSA report should include the basis for the number along with recommendations on ways to reduce the allocation and streamline the process. Failing to read through the report and follow the recommendations is wasting your money. For example, there may be suggestions to

 

  • Clarify ongoing medication use
  • Address open-ended treatment
  • Implement an action plan to reduce high opioid or other medication use

 

The vendor may have services that can address these and other issues that will better ensure CMS approval. Also, the report may include unintentional oversights or a misinterpretation of the records. Since you know the details of the claim better, it makes sense to read through the report and question anything that you don’t understand.

 

 

  1. Allow for Intervention

 

Missing medical reports, open-ended medication recommendations, and inconsistent physician statements are among the many hurdles that can increase the allocation or stall the approval process. The MSA vendor should provide an intervention plan to address any such issues that arise before the MSA report is completed and submitted to CMS. You should authorize the company to move forward with the plan and to meet with any attorneys involved if necessary.

 

 

  1. Work with the Compliance Team

 

A couple of questions are best left to attorneys, such as whether an MSA is even necessary and, if so, how state statutes, regulations or case law may affect the preparation and submission of the MSA. MSP vendors typically work with attorneys who are experts in MSP compliance. They can show you various tactics to limit the allocation amount. To do so, you need to provide the vendor with information on accepted and denied body parts along with relevant court orders, rulings or depositions.

 

 

  1. Agree to Escalation

 

A claims professional who neglects to respond to a recommendation from the vendor can create problems getting CMS approval. Conversely, the MSA vendor’s front-line personnel may not be giving you the information you need. Both you and the vendor should agree to have an escalation process in place. This will allow the vendor to bring the recommendation to a supervisor or manager, and lets you talk with a key contact at the vendor’s office to get a complete picture of any issues that must be addressed.

 

  1. Task Vendor as Gatekeeper

 

If your organization has many legacy or other claims that have been open for a while, you may want to conduct a settlement initiative. This typically involves many parties; such as defense attorneys, structured settlement brokers, professional administrator and a medical case manager. Have the MSA vendor act as the gatekeeper for this, by coordinating MSA development, clinical intervention, and CMS submission. That frees up the claims handler and defense attorney to focus on settlement negotiations and finalization.

 

 

  1. Include the Vendor in Finalization

 

The settlement terms must be consistent with CMS guidelines, including the proper inclusion of the MSA and defining Medicare conditional payment resolution. Also, CMS requires the MSA company to submit final, court-approved, settlement documents to make the approved MSA effective. Your defense attorney should, therefore, work with the MSP compliance team to avoid any problems later.

 

 

  1. Monitor Performance Metrics

 

You want to make sure your partnership with the MSA vendor continues to be successful and correct any areas that need improvement. The vendor should be able to provide performance metrics, such as

 

  • The number of MSA referrals
  • The turnaround time to write the MSA report
  • The CMS approval rate
  • Percentage of MSAs with prescription medications
  • Cost savings as a result of interventions
  • Percentage of MSAs with Development Letters from CMS

 

 

Conclusion

 

MSAs are complicated and can be expensive and time-consuming. Partnering with the right experts and staying involved with them can get you to a less costly settlement sooner.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

What To Expect From A Structured Settlement Consultant 

Injured workers who settle their claims are increasingly looking to settlement experts to help smooth the process. One of the key players in the equation is the structured settlement broker; the person who helps bring the case to resolution.

 

But there are many companies and individuals under the umbrella of ‘structured settlement broker,’ and they do not all function alike. It’s important to understand what they do — and what they can do — to ensure the settlement is truly a win-win for all parties, especially the injured worker.

 

 

Broker vs. Consultant

 

Planning a settlement is much more involved and complex than many may think. It requires more than just getting the money to the injured worker. There are many administrative and governmental issues that may need attention. Also, the injured worker may have needs beyond those of the immediate future must be taken into account. This takes a well-thought-out strategy.

 

The role of a structured settlement broker is evolving. The idea of setting up a transaction, signing the paperwork and then ending the relationship is over. The best companies to handle claims settlements are those that act as consultants to injured workers, understanding their needs and bringing in the best people to handle them.

 

Each settlement must be customized to fit a specific injured worker. Among the issues that may require involvement by experts are:

 

  1. Lien resolution.
  2. Financial planning.
  3. Tax consequences.
  4. Government benefit programs.
  5. Legal issues.
  6. Retirement planning.
  7. Insurance concerns.
  8. Future college education for children or grandchildren.

 

The consultant should know various settlement tools that can address these issues. For example, a consultant that works with insurance planners can provide comparative information on insurance products, such as disability or long-term care insurance. Having the benefit of an expert in Medicare Set-Asides available can ensure compliance and reporting issues are addressed, so future benefits are not put at risk.

 

These experts can be brought into the process early on, so the settlement is set up appropriately. Rather than just running quotes, the structured settlement consultant should act as the general contractor in identifying, bringing and managing the best experts to the table.

 

The consultant’s services should also be completely fee transparent, and come at no cost to the injured worker.

 

 

Examples of Issues and Players

 

Many circumstances may be overlooked in the settlement process. Working with an experienced structured settlement consultant can reveal and address those, such as:

 

  • Attorney Fee Deferrals. There are many ways to structure attorneys’ fees to allow money to be used in the future. Money deferred can be used for supplemental retirement funds, protection against inflation with cost of living adjustments, and potential avoidance of the Alternative Minimum Tax, for example.

 

  • Calculating realistic future medical costs. A top-notch structured settlement consultant should be able to show comparisons of the current costs of medications and procedures relevant to the injured worker with discounted costs offered through the consultants’ networks.

 

  • Trust funds. Trusts can be a great benefit to manage and protect assets, regardless of the person’s wealth level. Proper planning requires establishing a trustee, identifying beneficiaries, and determining how the assets should be held, invested and distributed. A qualified structured settlement consultant should be able to provide unbundled, transparent and competitive administrative and investment advisory pricing that will ultimately save money for the injured worker.

 

 

Collaborative Process

 

A successful structured settlement begins with a positive relationship between the injured worker and the consultant. A typical injured worker who is thinking of settling his claim is likely unaware of many issues he will face in the years ahead for which he is not prepared. By working closely and getting to know the injured worker the consultant can proactively identify concerns that may arise over the person’s lifetime.

 

The consultant and injured worker should work together as a team to find the optimal solutions. Bringing in the consultant as early as possible in the process allows him to become better acquainted with the injured worker and uncover his short- and long-term needs.

 

Once the settlement is reached, the consultant should ensure there will be someone to continue acting as a support and guide. They should have relationships with professional administrators who work with the injured worker throughout his life, guiding him through the many regulatory and medical mazes he will face.

 

 

Summary

 

The expectation for a structured settlement broker is a company that brings value beyond just the transaction itself. It should be a consultant that oversees the entire process, with the injured worker and his needs at its core.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

You’re Fired! Using Employment Releases in Work Comp Settlements

You’re Fired! Using Employment Releases in Work Comp SettlementsMany workers’ compensation cases that are settled include the voluntary resignation of the employee.  When this is the case, the employer/insurer request the employee sign an employment resignation and release document as part of the global agreement.  Failure to understand this process can result in added costs and missed objectives any settlement.

 

 

Meeting Expectations and Avoiding Miscommunications

 

The employment resignation and release is a legal contract between the employer and employee.  Given the nature of this agreement, it is outside the scope of a workers’ compensation insurance policy.  This adds to the complexity of settling a claim that includes employment law issues and requires each party to understand their proper role:

 

  • Defense Attorney: Attorneys representing the employer/insurer need to consider many   These factors include the scope of their representation in the claim and understanding of the law in employment matters.  Any misstep can result in unwanted malpractice claims and professional conduct or ethics violations;

 

  • Insurance Carrier: Members of the claims management team need to be in communication with the employer regarding the resignation of an employee as part of a global workers’ compensation settlement.  The consideration or money paid under an employment release is not covered under the workers’ compensation insurance contract;

 

  • Employer: Representatives from the employer need to remember adequate consideration in a release makes an employment law release a binding contract.  They also need to communicate their expectations to the insurance carrier and defense attorney regarding materials terms and conditions of the agreement.  They can also be expected to pay for legal services rendered for the preparing of the release; and

 

  • Employee’s Attorney: Monies paid under an employment release is taxable income under the Internal Revenue Code.  This tax needs to be fully explained to the employee.  There can also be considerations for potential legal malpractice and ethical violations if the expectations and terms are not explained fully to the employee.

 

 

The Basic Elements of an Employment Release

 

Given the contractual nature of an employment release, it needs to be in writing and have several key elements.  Failure to include these items can result in unnecessary and costly litigation:

 

  • Writing: All voluntary resignations and release agreements must be in writing.  It should outline how payments will be made and to whom it will be delivered.  The release should also include the timing of payments as there is usually a rescission period outlined by state law.  Payments should also be properly characterized for income tax purposes;

 

  • Monetary Consideration: The payment of money is a necessary component for such release – it is referred to as “consideration.”  This exchange is generally a nominal amount based on local custom and statutory guidelines, if applicable.  The employer is the party responsible for making this payment; and

 

  • Other Matters of Concern: A typical release includes discussion of other issues.  This discussion can include issues considering future reference letters, non-disclosure clauses (and what happens if material issues are disclosed to an unauthorized party) and “non-disparagement” agreements.

 

Mistakes in these areas commonly occur when lawyers with little understanding of employment law matters are involved in the drafting of voluntary resignations and releases.  It is also important to understand applicable state and federal laws such as the Fair Labor Standards Act, American with Disabilities Act and Family Medical Leave Act.

 

 

Waiting Periods and Settling a Work Comp Claim

 

The time frame for the rescission of a voluntary resignation and employment release is another important issue as they sometimes interfere with the settlement of a workers’ compensation claim.  As a general rule, parties should wait at least 21 days after signing a release before making payment per the workers’ compensation settlement.  Failure to understand this can cause a situation where a penalty arises.

 

 

Conclusions

 

Having the employee voluntarily resign from a position in a global workers’ compensation claim is something to consider as stakeholders seek to reduce workers’ compensation program costs.  When incorporating these agreements into a global settlement, it is important to avoid pitfalls that may arise when using releases.  All interested stakeholders should be aware, seek component legal advice and plan accordingly.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center.

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Case Study: $13,885.64 in Savings Through Resolution of Conditional Payment Recovery Dispute

Reduce your workers' comp case studyComplying with the ever-changing rules and regulations covering Medicare Secondary Payer issues is challenging enough, but adding in the complex conditional payment resolution and recovery process could push a workers’ compensation payer off the deep end.

 

Unless you strictly follow all the requirements of this system, you risk a referral for collections to the U.S. Department of Treasury. Knowing when to call in an expert is a good bet to keep you out of the government’s crosshairs.

 

 

Conditional Payments

 

Medicare does not pay for medical services or treatments which it believes are the responsibility of another entity, such as workers’ compensation. In those cases, Medicare is the secondary payer involved.

 

A conditional payment occurs when there is evidence that the other entity, workers’ compensation, has not promptly paid the bill. Medicare will then make the payment on the condition it will be reimbursed once the other entity does pay.

 

The responsibility for collecting the reimbursement rests with either of two entities; the Benefits Coordination & Recovery Center (BCRC) or the Commercial Repayment Center (CRC), which issues a demand for the repayment. If the debt is not paid or appealed to Medicare within 180 days, it is referred to the Treasury Department for collection.

 

 

Collecting the Debt

 

The Treasury Department has a number of methods to collect on debts owed to the federal government. For example, there are

 

  • Demand Letters
  • Telephone calls to the debtor
  • Administrative wage garnishment
  • Credit bureau reporting
  • Private Collection Agencies (PCAs)

 

One other avenue is the Treasury Offset Program or TOP. This program allows the Treasury Department to offset a federal payment to the debtor and use the offset to pay the debt.

 

For example, if the debtor is owed a tax refund, the money it will be taken from the refund.  Or, if the debtor is receiving a grant or rent money from the federal government, it will be taken out of this payment.

 

This system can create major headaches for carriers or a self-insured employers’ accounting departments, as less money than expected is received from the federal government. The result is the claims department, or risk manager gets called in to explain why the federal government is deducting these amounts as a result of a workers’ compensation claim and why the matter was not handled timely to avoid this issue.

 

 

Case study (provided by Towers MSA Partners); Resolving a Conditional Payment Dispute

 

 

Challenge

 

In this particular case, a self-insured real estate investor leases property to various entities, one of which is the federal government for a U.S. postal office. An employee of the real estate investor — unrelated to the U.S. post office — had suffered a work injury which was resolved and approved by a worker’s compensation judge. A few years post-settlement, Medicare issued a Conditional Payment Notice and demanded reimbursement of its lien for $14,026.00. The matter was referred to the Department of Treasury for collection, which applied the TOP and withheld federal funds owed for the rent for the postal office space.

 

Total MSA exposure = $14,026.00

 

Solution

 

After reviewing the details of the claim and the demand for reimbursement by Medicare, Tower’s legal team determined an appeal of the entire conditional payment amount was justified because the charges were unrelated to the work injury. The matter moved from the Department of Treasury back to the CRC, which concurred with the appeal that the charges were not related to the work injury, and therefore, not the responsibility of the employer.

 

Results

 

CRC agreed with the rationale and determined the payments were appropriately paid by Medicare. Also, the funds previously held by the Department of Treasury have been returned to the employer.

 

Total Savings = $13,885.64

 

 

Conclusion

 

Complying with Medicare requires continuous attention to the program. While the government has made some changes over the years to simplify the process, you must still engage Medicare in this process

 

Conditional payments can be tricky as there are specific deadlines and failure to meet them creates problems for workers’ compensation payers, as seen here, with Treasury Department collection actions. Medicare will generally remove unrelated charges from its demands, but it requires payer action to have the charges removed.  So, it is especially important to verify that all conditional payments are related to the claim before settlement.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

NCCI Report Recap: How Professional Administration Factors In

NCCI Report Recap: How Professional Administration Factors Innew research brief on MSAs and Workers’ Compensation by the National Council on Compensation Insurance (NCCI) reveals significant opportunities to help injured parties, especially through use of support systems like a professional administrator.

 

The brief updates a previous report published in 2014. That document considered data on MSA submissions to the Centers for Medicare and Medicaid Services (CMS) between September 2009 and November 2013. The latest version also includes information from 2014 and 2015 submissions, based on 11,500 MSA submissions.

 

As Medicare is a secondary payer for work-related injuries, insurance carriers must protect Medicare’s interests when settling claims. Many insurers create MSA funds to help pay for injury-related costs that Medicare might otherwise pay. There is no legal requirement to submit a proposed MSA to CMS; however many insurers choose to do so. Once the CMS-approved set-aside amount is spent and properly accounted for to CMS, Medicare will pay for future covered expenses.

 

Findings and Discussion

 

  • “The largest share of MSAs are submitted about four years after the injury. The number of submissions gradually decreases after that, but it is not uncommon to have a submission 20 or 25 years from the accident.”

 

The amount of the MSA increases with each passing year. As NCCI’s report notes, in the first year, the average amount of an approved MSA is $53,213; by year 5, that has increased to $105,430; and by year 20, it is $168,469.  Clearly, it makes sense for payers to settle claims as soon as possible. It also benefits the injured party, who is in a better position to move on with his life and not dwell in a disability mindset.

 

  • “Almost 95% of submissions are for claimants who are Medicare-eligible.”
  • “Almost all MSA settlements are self-administered. Larger MSAs are more likely to be professionally administered than smaller MSAs.”

 

In fact, only 2 percent of MSAs are handled by professional administrators. This is discouraging, as that means 98 percent of injured parties with MSAs are themselves responsible for complying with all the Medicare requirements, including:­

 

  1. Maintain line item detail for the duration of eligibility
  2. Use the fund only for Medicare covered expenses
  3. Pay according to the appropriate fee schedule
  4. Prepare and submit annual accounting report to CMS
  5. Deposit the fund into an interest-bearing account
  6. Use the fund only for treatments related to the injury

 

Failing to comply with all six requirements puts the injured party at risk of being denied benefits by Medicare.

 

In addition to compliance, having a professional administrator involved can also extend the life of the MSA fund. Savings on provider bills, durable medical equipment, medical treatment, and prescriptions are only available to injured parties who have a professional administrator involved with their post-settlement scenario.

 

  • “While many MSAs have been approved by CMS as submitted, CMS often requires that the MSA be increased.” In fact, the gap between the average amount submitted for an MSA and the amount approved by CMS increased slightly from 2013 to 2015.
  • 2013 — Submitted amount: $101,260; approved amount: $111,793 – a difference of $10, 533.
  • 2015 — Submitted amount: $88,911; approved amount: $103,288 – a difference of $14,377.

 

Much of the increase in this gap is due to prescription medications.

 

  • “Overall, drugs are about half of MSA amounts, but for more than one-third of MSAs, drugs are less than 10 percent of the MSA value.”

 

Working with a professional administrator can entitle injured parties to significant discounts on medical costs. Injured parties who are shown the cost differences through a professional administrator compared to the retail prices they would otherwise pay are often pleasantly surprised to see how much they can save.

 

  • “More than half of MSA claimants seek claimant attorney assistance when establishing MSA arrangements”

 

54 percent of MSAs involve an attorney, while the remaining 46 percent do not.

 

Injured parties leery of settling their claims often feel overwhelmed by the various requirements for compliance, as well as the fear of managing their money so they don’t run out too soon. Professional administrators can help guide injured parties (and all involved parties) through the settlement maze, and stay with them after settlement.

 

 

 

Author Leah Fusco, Chief of Staff, Ametros. Leah manages all of Ametros’ clients and partners, manages and supports the sales team, analyzes trends, and provides reporting and analytics. She brings over a decade of claims, settlement consultation and account management experience to Ametros. Prior to joining Ametros, Leah was a manager within the Medicare Compliance Department at Sedgwick, a leading third-party claims administrator. Before working with Sedgwick, she worked in Claims Management at PRM Claim Services, and Triad Group. Leah obtained her A.A. in Humanities and Social Sciences from Schenectady County College, and her B.S in Business Management from The Sage Colleges. She is CMSP certified, and is also a licensed New York Independent Adjuster, and a licensed life broker. Leah is an officer of the Albany Claims Association. She currently resides in Albany, New York with her husband and son.

The Path to Engaging a Structured Settlement Consultant

The Path to Engaging a Structured Settlement ConsultantLegacy claims that have been sitting on the books for months, years or even decades can add up to major headaches and expenditures for workers’ compensation payers. Despite all attempts to close them, the injured worker involved just doesn’t seem to be interested in settling the claim.

 

The good news is, there are organizations solely committed to bringing even some of the most difficult cases to settlement and creating a true win-win for all stakeholders involved – including the injured worker.

 

Structured settlements are an alternative to lump sum settlements, which often fail to take care of the injured workers’ needs long term. Structured settlements can be set up to deliver varying amounts of money over the injured worker’s lifetime which can address all his current and future needs, such as:

 

  • Medical expenses
  • Living costs
  • Children’s education
  • Special needs trusts
  • Establishing a business
  • Home modifications

 

Working with an experienced, highly professional structured settlement consultant can be a lifesaver, for the injured worker, his family, employer and the payer.

 

 

Why Claims Don’t Settle

 

Structured settlement consultants specialize in settling claims. Typically the most difficult challenge in settling claims is addressing the injured workers’ concerns:

 

  • Concerned there will be no money
  • Not wanting to deal with Medicare compliance issues
  • Worried about losing support to navigate the medical system
  • Uneasy about the red tape involved in paying medical bills
  • Afraid of change

 

The emotional concerns of injured workers with legacy claims are just as, or even more important than the practical concerns, such as running out of money too soon. While injured workers may abhor dealing with the workers’ compensation system, they find some comfort in knowing they will get a consistent flow of money and that they have someone, the claims adjuster, who helps steer them in the right direction.

 

Part of the problem with trying to close these claims is that the injured worker has not had anyone fully explain the options available in settling. The claims adjuster may ask every few months whether the injured worker is interested in settling, but that person is not in the best position to develop a settlement plan. This process requires someone getting involved with the injured worker; understanding his particular needs, his family situation, and what he wants for the future. Engaging with an injured worker this way can reveal his true needs and concerns, which can lay the groundwork for a settlement.

 

 

Why a Structured Settlement Consultant

 

Structured settlement consultants don’t get paid unless and until the claim settles. Therefore, they work with all parties involved, rather than promoting one side or entity over another. For claims to settle, everyone involved must agree it is a win-win arrangement.

 

Your consultant knows that the easiest way to achieve a solution is by ensuring that all needs are addressed. Working under the premise that there is no one-size-fits-all, or cookie-cutter approach to settlements, the consultant creates a customized plan that takes into account any and all issues that may arise over a person’s lifetime. Using the flexibility of a structure allows for addressing these issues, but a good consultant will present a variety of solutions, sometimes even going beyond the structured settlement.

 

For example, the settlement might involve a large initial payout for the injured worker to pay off medical bills, attorney fees, liens, and other bills. It might then have an ongoing stream of specified monthly payments, and it might include a larger stream of payments designated for a certain time period if, for example, a child will reach college age and needs money for education.

 

 

Engaging a Structured Settlement Consultant

 

Often, a settlement consultant can help by finding a block of claims with high reserves that seem to be going nowhere. Providing the name of the case, the adjuster, the claims liaison, attorneys, employer, TPA and a brief synopsis to the structured settlement consultant starts the ball rolling. With permission, the consultant can reach out to the various parties, gather information and report back as to which claims make sense for settling, as well as which cases do not and why.

 

The best and most efficient time to engage a settlement consultant is as early as possible, rather than waiting until the 11th hour when the claim has been open for 22 years. As new cases come up, they too can be earmarked for possible settling.

 

 

Best Claims for Settling

 

Despite all the advantages of structured settlements, not all claims are ripe for them. Identifying these cases can be difficult to manage, thus it’s important to choose a consultant who understands both structured settlements as well as other settlement options, and which are most preferable for the case at hand.

 

Ultimately, choosing a company that employs objective Settlement Planners over Structured Settlement Brokers can be the best route. Settlement Planners are trained to offer a variety of solutions, rather than a single approach. However, whether you choose a Settlement Planner or a Structured Settlement Broker, these consultants are trained to think outside the box and are much more likely to bring legacy claims to settlement.

 

 

 

Conclusion

 

Structured settlement consultants are a great vehicle for getting long-term workers’ compensation claims off the books. By giving them minimal information on claims, they do the legwork and determine whether a claim is likely to be settled. They then go about getting a settlement agreement that meets the needs of all stakeholders.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center.

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

CRC Contractor Change Brings New Team to Medicare Conditional Payment Recovery Efforts

On Thursday, January 18, 2018, the Centers for Medicare and Medicaid Services (CMS) held a webinar to introduce the new Commercial Repayment Center (CRC) contractor, Performant Recovery, and Performant’s management team. This transition to a new contractor is important to insurers and employers as the CRC is responsible for recovery of Medicare conditional payments against these entities stemming from liability, workers’ compensation and no-fault claims where ongoing responsibility for medicals has been accepted.

 

Ted Doyle, the Performant MSP CRC Project Director, emphasized in his introductory remarks and throughout the presentation that their main goal is to make the transition seamless for all those who engage with the CRC. His message to stakeholders is CMS’s recovery processes and timeframes remain the same, it is only the entity handling those processes that is changing.

 

Besides Mr. Doyle, other webinar participants were John Albert, the Director of the CMS Division of Medicare Benefit Coordination and Laura Martinez, the MSP CRC NGHP Recovery Manager for Performant.

 

Key contractor transition information provided during the webinar was as follows:

 

  • The current CRC contractor, CGI Federal, will cease operations effective Friday, February 9, 2018.
  • Performant Recovery will commence CRC operations effective Monday, February 12, 2018.
  • Transition cutover, or what CMS calls “Dark Days,” will occur on February 8 and 9. During this period while CGI Federal will continue to answer telephone calls and the Medicare Secondary Payer Recovery Portal (MSPRP) will be available, the information will be limited to what was available at close of business on February 7. Also, uploading documents through the MSPRP will not be available.
  • Performant will go live as of 8am EST on February 12 at which point the MSPRP will once again be fully available as well as the call center. Correspondence received during the Dark Days or prior to the transition will be transferred to Performant for handling.

 

In regard to what will remain the same post-transition:

 

  • All current cases initiated by CGI will be transitioned to Performant.
  • Case information, copies of communication, correspondence and contact information, including letters of authority, will be fully accessible to Performant such that there should be no reason for stakeholders to resend correspondence or other information that was previously provided to CGI.
  • There will be no changes to CMS established recovery processes or timeframes applicable to MSP recovery.
  • The CRC Call Center will continue the same hours: 8am – 8pm EST
  • The CRC Call Center phone number will remain the same: (855) 798-2627
  • All Benefits Coordination and Recovery Center (BCRC) processes remain the same, including Section 111 Mandatory Insurer Reporting.

 

As for what is changing post-transition:

  • Effective 2/12/2018* the CRC has a new address:Medicare Commercial Repayment Center – NGHP ORM
    P.O. Box 269003
    Oklahoma City, OK 73216*Any correspondence received prior to 2/12/2018 will be held and then processed starting on that date.
  • Effective 2/12/2018 the CRC fax number is (844) 315-7627.

 

As with any transition, some bumps are to be expected. We are hopeful these will be short-term and that the transition will not only be seamless, but that Performant improves the customer service aspect of the Medicare conditional payment recovery process. CMS and Performant engaging with Tower MSA and other stakeholders through this webinar is a good first step at building a collaborative relationship with those impacted by the CRC’s recovery efforts.

 

It was indicated a copy of the presentation slides will be made available on the downloads section of the CMS Coordination of Benefits and Recovery website next week.

 

 

Author Dan Anders, Chief Compliance Officer, Tower MSA Partners. Dan oversees the Medicare Secondary Payer (MSP) compliance program. In this position, he is responsible for ensuring the integrity and quality of the MSA program and other MSP compliance services and products. Based upon his more than a decade of experience in working with employers, insurers, TPAs, attorneys and claimants, Dan provides education and consultation to Tower MSA clients on all aspects of MSP compliance. Contact: (847) 946-2880 or daniel.anders@towermsa.com

8 Questions from Attorneys about Medicare Set Aside Administration

8 Questions from Attorneys about Medicare Set Aside Administration1.  “What is my risk if my client makes mistakes with their MSA?”

 

 

2. “What’s the chance that Medicare denies my client’s care because they misused or misreported their Medicare Set Aside funds?

 

 

3. “Why can’t my client just find coverage through another private insurance plan?”

 

Determining the best approach to address MSAs with their client in the settlement process can be a challenge for many plaintiff attorneys. The questions above are common amongst plaintiff attorneys who struggle to provide comprehensive advice to their clients regarding the regulations and ramifications of the Medicare Secondary Payer statute (“MSP”).

 

There are still quite a few attorneys in the workers’ compensation and liability industries that try to find ways to avoid the need for a Medicare Set-Aside (“MSA”) altogether when their clients settle their claims. It is understandable; the MSP regulations are complex, and the guidelines from the Centers for Medicare and Medicaid Services (“CMS” or “Medicare”) restrict how their clients can use the settlement funds – which their clients do not like at all. In addition, most jurisdictions preclude attorneys from taking contingency fees on medical funds allocated for Medicare purposes.

 

These factors, among others, can lead attorneys to shy away from addressing MSP issues head-on with their clients and instead, consider risky approaches that may put them in danger of committing a malpractice claim. This article, in consultation with a number of the nation’s prominent plaintiff attorneys, addresses the less obvious aspects of MSP compliance and the common questions attorneys have, as well as how attorneys can best protect themselves and their clients as they address these issues.

 

 

Protect Your Client’s Benefits

 

4. “Will Medicare really deny my client’s benefits?”

 

 

5. “Show me a case where Medicare benefits were ever denied, or Medicare came after the client or attorney for misappropriated MSA funds?”

 

Denials of treatment from CMS after settlement occur daily. The Medicare Administrative Contractors in charge of approving all Medicare claims have systems in place to automatically deny injury-related treatments for individuals that have MSAs accounts with remaining funds. The Contractors are closely monitoring MSA account recipients using the Mandatory Insurance Reporting Section 111 data they receive from insurance carriers for every single settlement that involves a Medicare beneficiary. They match this data with the injured party’s MSA reporting to verify if the MSA has funding to pay, or if Medicare should accept payment.

 

Generally, very few of the MSA accounts managed by professional administration exhaust, when that occurs, the administrator should automatically notify Medicare of the account’s exhaustion. We are often contacted by Medicare to review the treatments that were paid and to determine exactly when the funds were exhausted. In most cases, Medicare requires receipt of this information before they begin providing coverage for any injury-related bills. There can be a number of unique issues that arise after settlement, such as conditional payments, denials, etc., that require specialized attention to be resolved.

 

There are no known litigated cases against Medicare for cutting off benefits due to misuse of MSA funds; however, that does not mean that denials of care are not routinely taking place. The ability to deny care and remain the secondary payer is the fundamental right that Medicare established in the federal MSP statute. Most industry experts have seen Medicare increase its commitment to monitoring MSA accounts over the past several years and expect that will continue into the future. In addition to workers compensation cases, Medicare has indicated that it plans to also institute a review process for liability cases as well; it’s a clear sign that, if anything, Medicare is paying closer attention to all settlements.

 

 

Facts about MSAs:

 

 

The reference guides and memos provided by CMS have some authority, but the authority is not statutory. An attorney could follow all the guidance provided by CMS, yet still, run some minimal risk of failing to address the regulations under the law. Nonetheless, the safest approach is to recognize and consider MSP laws in settlement proceedings which requires providing thorough client guidance and a qualified advocate, to help the client abide by the guidelines. By doing this, the attorney can show that they did everything possible to protect the client’s Medicare benefits thus avoiding any successful claim of malpractice.

 

 

Insurance Coverage Misconceptions

 

6. “ But can’t my clients find coverage through another private insurance plan after they settle?”

 

 

7. “What about the Affordable Care Act?”

 

There is a frequent misconception by attorneys that their clients can get insurance coverage elsewhere and thereby not have to worry about an MSA. Although sometimes the injured party may initially be able to get another entity to cover their injury, most of the time insurance carriers are including exemptions for care relating to settled claims. Using another plan may be a good near-term way to save some of the MSA funds, but it may result in confusion over the long-term and the client spending MSA funds to pay for the premiums and deductibles of these new plans which will put them out of compliance with Medicare’s guidelines.

 

Private insurance plans, whether they be Medicare Advantage, Affordable Care Act plans, or provided through an employer, only last for one year at a time. MSA funds are meant to be used properly for the client’s lifetime. If the injured party believes they can rely on a private plan to cover their injury costs, they may be more incentivized to use their MSA funds to pay for that plan or for other non-injury related costs. If the private plan they rely upon ceases to exist, increases premiums drastically, or starts to deny their injury-related claims, the client will have put themselves in a very compromised position. At that point, they will likely not have a record of what they did with their MSA funds which will result in Medicare denials if they exhaust their funds. At the heart of the matter, it is risky to assume that a private insurance plan will be in place and available to the injured party for 10, 15 or 20+ years after settlement.

 

Over the past several years, private insurance plans have become much more vigilant on MSP matters. Other insurance entities are becoming increasingly savvy regarding the fact that they should not be the primary payer for these work-related or personal injuries and are finding ways to avoid paying. Medicare is the ultimate backstop for an individual’s healthcare, so if the injured party has misused their MSA funds and can’t get coverage, there really is nothing left to assist them with their care. When the client has exhausted their funds and cannot find private coverage, they will likely make two calls: The first is to their attorney, the second is to a malpractice attorney.

 

 

What is My Responsibility?

 

8. “I advised them of the risks, what else am I supposed to do?”

 

For attorneys that recognize the importance of having their clients thoroughly advised and aware of MSP guidelines, they are off to a good start. Many attorneys give their client an overview of the MSA’s purpose, but struggle to determine how they can truly protect themselves and their client once they hand their client what can be a sizable amount of money.

 

Medicare does allow for self-administration of MSA’s, but there’s good reason that Medicare recently came out and “highly recommended” professional administration (See Section 17 of Medicare’s updated reference guide).

 

Going through self-administration alone has often proven to be too much of a burden and challenge for the injured party. Medicare seems to have realized that its 31-page Self-Administration Toolkit is just too complicated for the average individual to follow. Attorneys need to consider whether their client understands what is happening and must determine whether they can realistically handle what is being asked of them for the rest of their lives. Or as Medicare puts it: will they be a “competent administrator?” Providing a professional administrator to help the client with administration of the MSA funds not only shows good faith to abide by Medicare’s recommendation, but it also helps the injured party save money on their medical care, remain compliant and have a resource to rely upon so that they are not continually reaching out to the attorney after settlement.

 

 

Get Professional Administration Involved

 

As with all decisions, attorneys should consider what approach sets both their clients and themselves up for success and the most defensible case if there are complications down the road. Taking a little extra time to get a professional administrator involved to explain what the MSA is and to set up administration will save the attorney potential exposure on a number of issues. Also, one should not forget, typically carriers are offering to pay for the administration service, so it is no extra cost to the attorney or the injured party.

 

Plaintiff attorneys take enough risks managing and growing their businesses and fighting for their client’s rights; there is no need to add to those challenges by risking any potential issues with Medicare.

 

If you have questions about MSA compliance and administration, don’t hesitate to reach out to our team of experts.

 

 

 

Porter Leslie is the President of Ametros. Porter has a passion for directing the growth strategy of Ametros and working with its many partners and clients.  He built his career leading customer-focused businesses in the healthcare and financial services industries. Prior to Ametros, Porter worked in investment banking, private equity and corporate development.

 

Porter earned a B.A. in Economics from Columbia University, as well as an MBA from the Wharton School and an M.A. from the Lauder Institute at the University of Pennsylvania. Porter is fluent in Spanish and Portuguese and resides in Boston with his wife, Ruth, and son, Camilo. Contact: https://www.ametroscards.com/porter-leslie/

 

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