New CMS Website: Medicare Secondary Payer Conditional Payment Information

On January 10, 2013, President Obama signed legislation for the establishment of a website to provide information to beneficiaries about their Medicare Secondary Payer (MSP) obligations.[1]  While there are exceptions, Medicare generally expects to be reimbursed if it makes a conditional payment for which a third party, such as other insurance or a personal injury settlement, may be liable.[2]
MSP beneficiaries and attorneys have long sought clarification of their obligations to reimburse Medicare for its expenditures on behalf of beneficiaries following an accident or injury for which third party liability is established.[3]   In addition, Medicare, through its contractors, has not always responded promptly or accurately to beneficiaries' requests for information about their reimbursement obligations.[4]
MSP Claims Information Via a Website
Per the new legislation, the Secretary of Health and Human Services must create a website through which final conditional payment amounts and information can be obtained by beneficiaries.[5]  Regulations to implement the new website are to be published in final form not later than 9 months from the date of enactment of the initiating clause of the legislation.[6] To compile the necessary information, the beneficiary is to notify the Secretary through the website at any time beginning 120 days before the reasonably expected date of a settlement, judgment, or award, etc.[7]  The final conditional payment amount is also to be made available to a beneficiary's authorized family member or other representatives, or to an insurance plan (plan) with the consent of the beneficiary.[8] In addition, the website is to provide a method for the receipt of secure electronic communications, including the official time and date that the information is transmitted. [9]
Within 18 months of enactment, the Secretary is to modify the reporting requirements on the use of Social Security numbers and other identifying information in reporting MSP information (with the possibility of a 1 year extension).[10] In addition, a plan is permitted, but not required, to access or report the Social Security account numbers or health identification claim numbers of individuals to the Secretary.[11]
The Final Conditional Payment Amount Subject to Recovery
If a beneficiary (or authorized individual) obtains a statement of a reimbursement amount from the website during the protected period (defined below) and the related settlement, judgment, award or other payment is made during that period, the last statement of the reimbursement amount that is downloaded during the protected period, and within 3 business days before the date of the settlement, judgment, award, or other payment will constitute the final conditional amount subject to recovery.[12]
If the individual (or authorized representative) believes there is a discrepancy in the statement of the reimbursement amount, the Secretary shall provide a timely process and identify the necessary documentation for its resolution.[13]  Within 11 business days after the date of receipt of such documentation, the Secretary must determine whether there is a reasonable basis to include or remove claims on the statement of reimbursement.[14] If the Secretary does not make such a determination within the 11 business-day period, the proposal to resolve the discrepancy is accepted.[15]  If the Secretary determines within such period that there is not a reasonable basis to include or remove claims on the statement of reimbursement, the proposal to include or remove shall be rejected.[16]
The process for resolving a discrepancy is not an appeals process and does not establish a right of appeal for a statement of reimbursement amount, nor is there administrative or judicial review of the Secretary's determination of the reimbursement amount.[17]
Defining a Protected Period for Obtaining Information Concerning an MSP Conditional Amount
A "protected period" means the period beginning on the date of notice with respect to the settlement, judgment, award, or other payment that is after the end of a Secretarial "response period.[18]  The Secretarial "response period" shall be a period of 65 days, except that such period may be extended by the Secretary for a period of an additional 30 days if the Secretary determines that additional time is required,[19] and for other exceptional circumstances.[20]
Exception to Claims Reporting Requirement (Below a Threshold Amount)
In general, a plan is exempt from the reporting requirements of the Act, with respect to any settlement, judgment, award, or other payment arising from liability constituting a total payment obligation of not more than the single annually set threshold amount calculated by the Secretary for the year involved.[21] Beginning in 2014, not later than November 15, the Secretary shall calculate and publish a single threshold amount for settlements, judgments, awards, or other payments for obligations arising from applicable liability issuance (including self-insurance) and for alleged physical trauma-based incidents (excluding alleged ingestion, implantation, or exposure cases) for that year.[22]
Report to Congress
Not later than November 15^th of each year, the Secretary shall submit to Congress a report on the single threshold amount for settlements, judgments, awards, or other payments for conditional payment obligations arising from liability insurance (including self- insurance). [23]  The report to Congress is also to include a discussion of a similar threshold amount for that year and for conditional payment obligations arising from worker compensation cases and from no fault insurance cases subject to this section.[24]
Civil Money Penalty for Insurer Non-Compliance
Insurers and plans "may be subject to a civil money penalty of up to $1,000 for each day of noncompliance with MSP reporting respect to each claimant."[25] Not later than 60 days after the enactment of this penalty provision, the Secretary must publish a notice in the Federal Register soliciting proposals on sanctions.[26]
Statue of Limitation for Medicare's Assertion of an MSP Payment Owed
Effective 6 months after enactment of the Act, an action may not be brought by the United States for an MSP payment owed unless the complaint is filed not later than 3 years after the date of the receipt of notice of a settlement, judgment, award, or other payment.[27]
Conclusion
The new MSP legislation and implementing efforts are a step forward.  Reliable information about MSP-related conditional payment amounts will be helpful. Timely and adequate information from Medicare Agencies is essential.  Having an annual threshold amount that is exempted from MSP recovery will be very useful.  Similarly, establishing a statute of limitation for suits to recover conditional payments will provide beneficiaries a long sought measure of finality in such matters.

For further discussion of MSP issues, contact policy attorney Alfred Chiplin (achiplin@medicareadvocacy.org) in the Center for Medicare Advocacy’s Washington, DC office at (202) 293-5760.

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[1] Title II of H.R. 1845, entitled "Strengthening Medicare Secondary Payer Rules," amends 42 U.S.C. §1395y(b)(2)(B) of the Medicare Statute, Pub. Law No. 112-242 (January 10, 2013).  See http://beta.congress.gov/bill/112th-congress/house-bill/1845/text. The Bill Summary and status report are available at: http://thomas.loc.gov/cgi-bin/bdquery/z?d112:h.r.1845. The current Medicare Secondary Payer Recovery Contractor (MSPRC) website is located at www.msprc.info. Title I, Section 101 of H.R. 1845, sets out a demonstration project under Medicare Part B for the payment of supplies and services related to the administration of Intravenous Immune Globin (IVIG) for the treatment of primary immune deficiency diseases.[2] The Medicare Secondary Payer program is set out at 42 U.S.C. §1395y(b)(2).[3] The Center’s work on MSP matters can be accessed at: http://www.medicareadvocacy.org/medicare-info/medicare-secondary-payer-program/. In addition, the Center led a task force of the Public Policy Committee of the National Academy of Elder Law Attorneys (NAELA) (www.naela.org) on the use of set-aside arrangements involving future medical expenses. The task force made recommendations on how attorneys might approach "future medicals" pending guidance from the Medicare agency. See: http://www.naela.org/App_Themes/Public/PDF/Home%20Page/ISSUE%20Medicare%20Set%20Aside%20TF_2%20(2).pdf. [4] See, for example, the joint findings and recommendations, sent to the Medicare Agency, by the Center for Medicare Advocacy, the Medicare Rights Center, and California Health Advocates, available at http://www.medicareadvocacy.org/2011/05/12/medicare-secondary-payer-practices-that-harm-medicare-beneficiaries/.[5] See §201of the Act.  Note, the term "website" includes any successor technology that might be developed. Id., at subclause (VII).[6] See §201of the Act, ("VI") Effective date.[7] See §201of the Act.[8]Id., amending §1862(b)(2)(B) of the Social Security Act, 42 U.S.C. §1395y(b)(2)(B), adding a new clause: (vii) use of website to determine final conditional reimbursement amount.[9] Id.[10] See §204, amending §1862(b)(8)(B) of the Social Security Act, 42 U.S.C. §1395y(b)(8)(B).[11] Id.[12] Id., at subclause "(III)."[13] Id., at subclause "(IV)."[14] Id.[15] Id.[16] Id.[17] Id.[18] Id., at subclause (V), protected period.[19] Id.[20] Id. In addition, the Secretary shall promulgate final regulations to carry out this clause not later than 9 months after the date of the enactment of this clause. Id.[21] Id., §202(a)(2) of the Act.[22] Id., §202(b).[23] Id., subclause "(D)"Report to Congress.[24] Id.[25] See §203, amending §1862(b)(8) of the Social Security Act, 42 U.S.C. 1395y(b)(8)( Required submission of information by or on behalf of liability insurance (including self-insurance), no fault insurance, and workers’ compensation laws and plans).[26] Id.[27] See §205, amending §1862(b)(2)(8)(iii) of the Social Security Act, 42 U.S.C. §1395y(b)(2)(8)(iii).