CMS Provides New Self-Calculated Final Conditional Payment Amount Option

CMS issued an Alert which provides an option for certain liability settlements below $25,000 to obtain a final Medicare conditional payment demand prior to settlement starting in February 2012. Under this option, the beneficiary or their representative will calculate the amount of Medicare’s conditional payment amount using information received from the MSPRC, the MyMedicare website, or other claims information available to the beneficiary. The MSPRC will review this amount and, if finding the amount accurate, will respond with Medicare’s final conditional payment amount within 60 days.

To secure the final conditional payment amount, the beneficiary must settle within 60 days after the date of Medicare’s response. Additionally, the alert confirms that ALL the below criteria must be met:

1. The liability (including self-insurance) settlement is for a physical trauma based injury (the settlement does not relate to ingestion, exposure, or medical implant);

2. The total liability settlement, judgment, award, or other payment will be $25,000 or less;

3. The Date of Incident occurred at least six months before the beneficiary or their representative submits the proposed conditional payment amount to Medicare;

4. The beneficiary demonstrates that treatment has been completed and no further treatment is expected either through a written physician attestation or by certifying in writing that no medical treatment related to the case has occurred for at least 90 days prior to submitting the proposed conditional payment amount to Medicare

A full explanation, including instructions on how and when to elect this option, will be available on the MSPRC website by January 15, 2012. This option is an “initial step” to provide beneficiaries and their representatives with Medicare’s conditional payment amount prior to settlement and CMS plans to expand this option as it gains experience with this process.

At this time, the self-calculation option will only be helpful for a small portion of liability settlements. However, if CMS truly expands the option to a larger group of settlements, it would greatly assist the liability community and avert the common issue of holding the release of settlement funds pending Medicare conditional payment demand.

PMSI believes that this alert, as well as other recent MPSRC changes (as noted in our October 26, 2011 blog) is a reaction to the proposed SMART Act. The SMART Act calls for the ability of parties to obtain final conditional payment amounts prior to settlement. As the SMART Act continues to garner increased bi-partisan support, CMS may be looking to stay in control and avert the need for legislation to reform the conditional payment recovery process.

To view the alert in its entirety please visit the MSPRC website.

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