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CMS to Launch Functionality in WCMSAP Which Allows for Direct Input of Prescription Drugs

By , August 25, 2014 12:43 pm

Through a recent alert issued on August 19, 2014, CMS has announced that it will be providing a mechanism for users of the Workers’ Compensation Medicare Set-Aside Portal (WCMSAP) to enter prescription drug information and calculate the proposed prescription drug portion of the WCMSA proposal.  The alert states that this will be available on all new and existing “work-in-progress” cases as of October 6, 2014. To access the alert, please click here.

A lookup tool will be provided to select the proper drug. Additionally, the tool will provide pricing and the prescription allocation will be automatically calculated once proper frequency is entered.

The alert provides that the new tool will include the following features:

  • New data-entry pages to provide users with the ability to indicate
    if a claimant is taking, or expecting to take prescription drugs as a
    result of the workers’ compensation injury.
  • Look-up tool that allows the user to search by drug name, National
    Drug Code (NDC) or manufacturer name.
  • Ability for user to select drug from look-up tool and add it to the
    portal case.
  • Ability for user to enter frequency for anticipated medications
    (per day, week or month) and system will calculate expected drug costs.

Helios Settlement Solutions applauds this action by CMS and believes that the new functionality will be very useful; submitters of WCMSAs through the WCMSAP will be assured of proper pricing of prescription drugs based upon monthly Redbook Drug Reference pricing in effect when the submission is sent in for review. This should alleviate a great deal of prescription drug pricing discrepancies that have typically occurred in the past.

It is unclear from this alert if submitters can use the tool to check pricing before the case is created/submitted. If submitters are able to do this, once the MSA is first prepared, the submitter could be informed of any possible changes in pricing.  The alert does not clearly indicate if this will be possible or part of the functionality. CMS did announce in its alert that more information will be forthcoming prior to the October 6, 2014 implementation and Helios is hopeful that CMS will offer that this functionality will be part of the new process.


CMS Issues NGHP Alert Clarifying MSP Criteria for Exposure, Ingestion, and Implantation Cases

By , August 21, 2014 1:29 pm

On August 19th, CMS issued an NGHP alert which clarifies a previous alert regarding MSP applicability to exposure, ingestion, and implantation cases and the December 5, 1980 date. Within this alert, CMS notes that it is clarifying a previous alert dated October 11, 2011. For the new August 19th alert, click here. For the previous October 11, 2011 alert, click here.

The August 19th alert is very similar to the October 11, 2011 alert. The main change in the new alert is to reference that the “most recently amended operative complaint or comparable supplemental pleading” applies when looking to see if exposure, ingestion, or implantation was claimed or released before or after December 5, 1980.

In other words, RREs should take note that the most recently amended operative complaint or comparable supplemental pleading will be the document used in determining whether the exposure, ingestion, or implantation is claimed or released and whether the ingestion or exposure occurred on or after December 5, 1980 and thereby falls within the MSP or not.


Texas Department of Insurance Issues Letter to CMS Regarding Improper Denials of Payment to Medicare Beneficiaries

By , August 18, 2014 10:27 am

On July 31st, the Commissioner of the Division of Workers’ Compensation for the Texas Department of Insurance (TDI), Rod Bordelon, issued a letter to Marilyn Tavenner, the Administrator at CMS regarding CMS improperly denying payment to Medicare beneficiaries. A copy of the letter can be found here.

In the letter, Bordelon states that TDI has been receiving numerous complaints from Medicare beneficiaries that they have been denied medical coverage by CMS due to the fact that the beneficiary had a previous workers’ compensation claim. In response, CMS has been asking TDI to confirm that the beneficiary’s prior workers’ compensation claim has been closed/settled so that the injured employee could seek medical treatment through Medicare. TDI cannot confirm that workers’ compensation claims are “closed or “settled” since under Texas state law, medical benefits for workers’ compensation claims are unable to be settled (Texas Labor Code, §408.005(b) and §408.021(d)).

Bordelon goes on to state in his letter that there is little policy guidance available for RREs to address situations where state workers’ compensation laws prohibit claim settlements for medical benefits (and therefore prohibit claims to be “closed” for future medical benefits. He therefore urges CMS in his letter to issue additional policy guidance to RREs on how to address situations, like these, where state laws prohibit the settlement of medical benefits for workers’ compensation claims.

In essence, there has to be better communication between CMS and RREs, and this issue needs to be addressed as this is creating unnecessary hurdles for Medicare beneficiaries who urgently need access to medical care for non-work related conditions. When looking at this issue, CMS should not only look to Texas, but other states as well where similar issues are occurring.


The 2014 Social Security and Medicare Trustees Recommendations May Lead to Furthering Medicare Secondary Payer Legislation and Regulations

By , August 15, 2014 11:24 am

Each year, the Trustees of the Social Security and Medicare trust funds report on the current and projected financial status of the two programs. Much like they have done over the last several years, in 2014, the Trustees again indicate that neither Medicare nor Social Security can sustain projected costs, and therefore again recommend legislative changes to avoid disruptive consequences for beneficiaries and taxpayers.

The Trustees indicate in their 2014 report that if lawmakers take action sooner rather than later, more options and more time will be available to phase in changes so that the public has adequate time to prepare. Earlier action will also help elected officials minimize adverse impacts on vulnerable populations, including lower-income workers and people already dependent on program benefits.

Based on the 2014 report, Social Security and Medicare accounted for 41 percent of Federal expenditures in fiscal year 2013. This is expected to grow since both programs will continue to experience cost growth substantially in excess of GDP growth through the mid-2030s due to rapid population aging caused by the large baby-boom generation entering retirement and lower-birth-rate generations entering employment.

Consequently, the financial status and expected increase in enrollment in both the Social Security and Medicare programs could potentially affect Medicare as a secondary payer and therefore CMS’ efforts regarding MSP services, regulations, and enforcement thereof. This article explores such possible effects and facets.

Social Security

There are two Social Security trust funds – the Old Age and Survivors Insurance (OASI) trust fund and the Disability Insurance (DI) trust fund. OASI provides early retirement and full retirement benefits to insured workers and their families, as well as benefits to survivors of insured workers and their families. The 2014 Trustees Report provides detailed information as to the number of workers paying into the system, number of beneficiaries drawing benefits, and predictions as to the financial stability of these funds to be able to provide such benefits in the future.

Although the OASI trust fund is currently in stable shape, as it meets the Trustees 25 year or short term financial stability tests, as it has over the last several years, the report again concludes that the DI program does not satisfy the Trustees’ short-range or long-range financial adequacy. It faces the most immediate shortfall of any of the trust funds. The Trustees project DI trust fund depletion late in 2016, the same year projected in last year’s Trustees Report, as DI costs have exceeded non-interest income since 2005.

While legislation is needed to address all of Social Security’s financial imbalances, the need has become most urgent with respect to the program’s disability insurance component. As the Trustees have urged Congress to do over the last several years, the report again recommends lawmakers to act soon to avoid automatic reductions in payments to the current 11 million and expected to continue to grow DI beneficiaries in late 2016.


There are two Medicare trust funds – the Hospital Insurance (HI) trust fund and the Supplementary Medical Insurance (SMI) trust fund. The HI trust fund oversees Medicare Part A, which provides coverage and payments to hospitals. The SMI trust fund oversees Medicare Part B, which provides coverage and payments to physicians; Medicare Part C, which provides capitated reimbursement to Medicare Advantage Plans (MAP) for Medicare beneficiaries who have chosen to receive their Medicare coverage through private health insurance plans contracted with Medicare to provide such coverage; and Medicare Part D, which provides coverage and payments for prescription medications.

The Trustees project that the HI trust fund will be the next to face depletion after the DI Trust Fund. The projected date of HI Trust Fund depletion is 2030, when revenues will only be sufficient to pay 85 percent of HI costs. As a result, the HI fund again fails the short-range and long-range Trustees’ financial adequacy tests primarily because of the significant growth in the Medicare eligible population over the next 25 years and the expected growth in needed medical services and higher costs for same during this time period.

The Trustees project that Part B of Supplementary Medical Insurance (SMI), which pays doctors’ bills and other outpatient expenses, Part C of SMI, which reimburses MAPs, and Part D of SMI, which provides access to prescription drug coverage, will remain adequately financed into the indefinite future because current law automatically provides financing each year to meet the next year’s expected costs. However, the aging population and rising health care costs cause SMI projected costs to grow steadily from 1.9 percent of GDP in 2013 to approximately 3.3 percent of GDP in 2035, and then more slowly to 4.5 percent of GDP by 2088.


Built within the Trustees’ predictions are the Affordable Care Act’s (ACA) cost-reduction provisions, which are expected to provide substantial savings to all parts of Medicare. However, notwithstanding recent favorable developments, both the projected baseline and current law projections indicate that Medicare still faces a substantial financial shortfall that will need to be addressed with further legislation or regulation. One of the potentially affected population bases by this shortfall is the group of Medicare beneficiaries that has primary coverage or where a primary payer is responsible for any medical problem associated with such care and treatment. As a result, it is expected that CMS will continue to step up their mandatory insurer reporting, conditional payment reimbursement, and future allocation arrangement compliance efforts through legislation and regulatory provisions.

It is anticipated that such legislative and regulatory efforts will aim to make certain that all primary payers, including liability defendants or plans, remain responsible for past and future payments related to any claim related expenses. Although according to CMS, MSP savings have grown from $2 billion annually five years ago to almost $8 billion in 2012, the belief is that these numbers have only begun to scratch the surface of the potential returns the MSP provisions will be able to provide to the trust funds and taxpayers, especially once a fully integrated, well thought out, comprehensive MSP program is created and up and running for all group health plans and non-group health plans.


The 2014 Social Security and Medicare Trustees report recommends lawmakers should address the financial challenges facing Social Security and Medicare as soon as possible. Very specifically, the Trustees report finds that the DI program does not satisfy the Trustees’ short-range or long-range financial adequacy, with projected depletion late in 2016. The Trustees also project that the HI trust fund will be the next to face depletion, with projected depletion in 2030. The Trustees recommend taking legislative and regulatory action sooner rather than later. It is anticipated that such legislative and regulatory efforts will aim to make certain that all primary payers, including liability defendants or plans, remain responsible for past and future payments related to any claim related expenses.


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