CMSCenters for Medicare and Medicaid Services has been under scrutiny since June 22, 2011 when they were questioned regarding the MSPMedicare Secondary Payer Act program during a congressional oversight hearing. Deborah Taylor, the Chief Financial Officer of CMSCenters for Medicare and Medicaid Services, faced very difficult questioning during the hearing regarding financial controls that CMSCenters for Medicare and Medicaid Services had in place to ensure the MSPMedicare Secondary Payer Act regime was operating efficiently.
On April 3, 2012, the release of a report by the GAOGovernment Accountability Office entitled “Medicare Secondary Payer- Additional Steps Are Needed to Improve Program Effectiveness for Non-Group Health Plans” was disseminated, seemingly in response to a request from Representative Stark (D-CA-9) on August 10, 2010. Both CMSCenters for Medicare and Medicaid Services officials and a group of NGHPNon-Group Health Plan - liablity (including self-insurance), no-fault and workers' compensation stakeholders were consulted during the review period which mainly included a review of processes and statistics over the last four years. For a copy of the GAOGovernment Accountability Office Report, please click here.
The GAOGovernment Accountability Office Report focused on multiple areas of interest to the industry and provided a quantitative overview of the increase in MSPMedicare Secondary Payer Act contractor workloads, CMSCenters for Medicare and Medicaid Services payments to contractors, and Medicare savings from 2008 through 2011. The Report noted that the increase in workload is directly related to the delays CMSCenters for Medicare and Medicaid Services and its contractors have been experiencing. CMSCenters for Medicare and Medicaid Services has stated that the increase in workloads is expected to continue and could be due to mandatory reporting and the industry’s submissions of ineligible WCMSAWorkers' Compensation Medicare Set-Aside submissions.
One of the more significant points the GAOGovernment Accountability Office made was that the MSPMedicare Secondary Payer Act process should always be cost effective. If administrative costs exceed the recovery amount, the intent to protect Medicare’s interest becomes questionable. While CMSCenters for Medicare and Medicaid Services has taken steps to address some of these concerns, there are other issues that have not been adequately addressed, such as how to appropriately consider Medicare’s interest in liability settlements, the lack of a formal appeals process for WCMSAs and the significant turnaround times for WCMSAWorkers' Compensation Medicare Set-Aside reviews.
The report concluded with the GAOGovernment Accountability Office making the following recommendations to HHSDepartment of Health and Human Services to improve the effectiveness of the MSPMedicare Secondary Payer Act process:
- CMSCenters for Medicare and Medicaid Services should review the recovery thresholds periodically to ensure recovery efforts are being conducted in the most cost-effective manner possible
- CMSCenters for Medicare and Medicaid Services should not require NGHPsNon Group Health Plans to report MSPMedicare Secondary Payer Act cases which the Agency would not pursue for recovery
- CMSCenters for Medicare and Medicaid Services should consider making the submission of ICD-9International Classification of Diseases, 9th Revision codes an optional component of reporting for liability NGHPsNon Group Health Plans
- CMSCenters for Medicare and Medicaid Services should take the following actions to improve communication:
- Develop a centralized MSPMedicare Secondary Payer Act program website
- Develop guidance regarding liability and no-fault set-aside arrangement
- Review and revise the correspondence sent to beneficiaries to ensure rights and responsibilities are more clearly communicated
The GAOGovernment Accountability Office’s MSPMedicare Secondary Payer Act report concludes with comments made by the HHSDepartment of Health and Human Services in response to the GAOGovernment Accountability Office’s recommendations. HHSDepartment of Health and Human Services generally concurred with the majority of the GAOGovernment Accountability Office’s recommendations, and stated that several items were already being worked on. Of interest, in response to developing guidance regarding liability and no-fault set-aside arrangements, CMSCenters for Medicare and Medicaid Services responded that it was currently working on this and plans to use notice and comment rulemaking to seek industry input. The liability industry has been waiting for guidance from CMSCenters for Medicare and Medicaid Services in this area, and will certainly welcome the opportunity to comment on how this should process should be implemented, if at all. However, it begs the question of why the workers’ compensation industry did not have an opportunity for notice and comment rulemaking with regard to WCMSAs. Perhaps that is forthcoming as well?
While the GAOGovernment Accountability Office study did not bring any major ground-breaking issues to light, it certainly brings the need for improvements to the MSPMedicare Secondary Payer Act process to the forefront of the government’s attention. This GAOGovernment Accountability Office Report, along with other legislative activity such as the SMARTStrengthening Medicare and Repaying Taxpayers Act of 2011 ActStrengthening Medicare and Repaying Taxpayers Act of 2011, should promote more streamlined processes so that the MSPMedicare Secondary Payer Act program operates efficiently and properly takes into account the interests of both the insurance industry as well as the Medicare Trust Fund.
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