American Insurance Association Opposes Proposed Maryland Set-Aside Regulation

waitThis post serves as a follow up to our original blog on September 13, 2011 regarding the new proposed Maryland regulation affecting workers’ compensation settlements as it relates to ensuring that Medicare’s interests are protected before a settlement will be approved.

The new proposed regulation is much less stringent than the last version and seems to harmonize with CMS directives by allowing for approval of settlements without mandating CMS review and approval of an MSA.  However, there continues to be opposition to the proposed regulation.

An article posted on WorkCompCentral (subscription required) earlier this month noted that the American Insurance Association (AIA) filed their opposition to the new version of the regulation. The AIA argued that the compromise did not alleviate the concerns originally expressed, that the proposed MSA regulation would create undue delays in the approval of settlements and would also leave attorneys with the responsibility of obtaining CMS approval of MSAs.

Furthermore, it is noted in the article that Bruce Wood, Associate General Counsel and Director of Workers’ Compensation for the AIA, points out that the amount of state settlements dropped 33% between 2009-2010, according to the Commission’s 2010 annual report. It is clear that the AIA feels these statistics would only worsen upon passage of the proposed MSA Regulation.

A meeting will be scheduled in the next few months to discuss comments received on the compromise proposal.  The comment period ended on October 11, 2011.

The Workers’ Compensation Section of the Maryland Association for Justice is backing the revised proposed regulation.  If the regulation is approved, it will then be submitted to the Maryland General Assembly’s Joint Administrative, Executive, and Legislative Review Committee (AELR).

The new Maryland MSA proposed regulation does not seem to require anything that the MSP does not itself require, other than actual identification of the consideration of Medicare’s interests in the settlement documents.

To view the proposed legislation please click here and refer to page 49, Title 14, Subtitle 09.

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