2012 Elections: How Will it Affect CMS, MSAs, and the MSP?

With the upcoming Presidential elections on November 6, 2012, the industry has been wondering what changes, if any, the election results would have on CMS, MSAs, and the MSP.

Additionally, with the Patient Protection and Affordable Care Act (PPACA), also commonly known as Obamacare1, being recently upheld in the U.S. Supreme Court as constitutional, one might wonder what the effect will be on the DHHS and CMS. Obamacare has been referred to as one of the largest changes to the U.S. healthcare system since the founding of Medicare and Medicaid almost five decades ago2. Regardless of one’s political affiliation, one cannot deny that the implementation of Obamacare would seemingly tie up resources at both the DHHS and CMS while implementing these changes.

The current, and arguably most impactful, activities surrounding MSAs and MSP reform are the following: 1) a new contractor, Provider Resources Inc., reviewing WCMSAs since July 2, 2012 (click here for prior blog on the new contractor); 2) an ANPRM which proposes formalized rules regarding MSP obligations and future medicals (comment period closed on August 14, 2012; for more information on the ANPRM click here for our prior blog); and 3) two pieces of legislation which propose reform of the MSP: The SMART Act and the Medicare Secondary Payer and Workers’ Compensation Settlement Agreements Act of 2012 (click here for prior blog regarding these Acts).

 Let’s look at each one more closely.

 1)     New WCMSA Contractor

There are mixed results and opinions on the new contractor. While turnaround time for WCMSAs submitted since July 2, 2012 has greatly improved, many have seen vast differences in the way the new contractor has been pricing and reviewing WCMSAs as compared to the prior contractor. All are hopeful that as the new contractor settles in, they will provide reasonable and predictable allocations of WCMSAs. Until Provider Resources, Inc. or CMS provides more predictability to the industry through concrete guidelines and consistency in the review process, WCMSA counter-highs may be inevitable.

  1. If Barack Obama is re-elected: Since Provider Resources, Inc. was chosen under his administration, it is unlikely we will see a change in vendors. Additionally, they are just “getting their feet wet” and arguably would need time before their abilities can be judged.
  2. If Mitt Romney is elected: The Statement of Work appears to be issued for one year periods3 and any changes to the contactor would have to come at the expiration of their Statement of Work period. Regardless, it is likely that the election of Mitt Romney would mean that a new DHHS Secretary would be elected. With Kathleen Sebelius no longer in office, a change in governmental contractors is always a possibility.  It is unclear whether Mitt Romney would change WCMSA contractors. However, if Provider Resources appears to be doing a good job after an expected “learning curve” period, it would not make sense to change them.

2)     ANPRM

  1. If Barack Obama is re-elected: As the ANPRM was issued under his administration, a re-election of Barack Obama would likely help it move along more quickly. The officials at DHHS and CMS currently reviewing commentary received from the public would retain their jobs and could respond and provide finalized rules more quickly. While the focus on implementing Obamacare will still be the top priority of these agencies, one can anticipate that the rule making process will continue.
  2. If Mitt Romney is elected: Kathleen Sebelius would undoubtedly be replaced, which would mean that between November and January 1st, she along with the rest of DHHS would likely focus its efforts on transitioning to a new Secretary. The rule making process would predictably stall during this time. After January 1, the new Secretary of DHHS may be focusing his/her efforts on dismantling Obamacare. Although many have opined that it would be difficult for this to be done4, any focus on the ANPRM could possibly be dismantled or significantly delayed altogether. Regardless, Mitt Romney has proffered that, “[h]is goal is for Medicare to offer every senior affordable options that provide coverage and service at least as good as what today’s seniors receive.”5 Due to the fact that Romney has stated that he is dedicated to preserving the Medicare trust fund and coverage for beneficiaries, it is likely that some form of the ANPRM or other proposed rulemaking would eventually re-surface which would aim to protect Medicare beneficiaries as well as the Medicare Trust Fund.

3)     SMART Act and other WCMSA Legislation

This legislation may not only be impacted by the Presidential election, but also may change due to the composition of the legislature.  Assuming the composition of the House and Senate remain relatively unchanged, the fact that the SMART Act has bi-partisan support should help it to continue to move through the Legislature.

  1. If Barack Obama is re-elected: The SMART Act recently passed the House Energy and Commerce Subcommittee on Health on September 11, 2012 and is planned to head to the full Energy and Commerce Committee for a vote before floor consideration in the House. If Obama stays in office, it is likely that we will eventually see both the SMART Act and the WCMSA legislation tied onto another piece of healthcare legislation with a better chance of passing if Obama stays in office.
  2. If Mitt Romney is elected: Mitt Romney has frequently commented that he will dismantle Obamacare on day one. Many political experts believe that if Romney is elected, his best chances of dismantling Obamacare would be if the Republican Party could win control of both the House and Senate, and in which case he would need to stave off filibusters and repeal the Act.6 Clearly Mitt Romney would try to focus Congress’ efforts on dismantling Obamacare and both pieces of MSP reform legislation may lose priority.  One could anticipate that just as the passage of Obamacare was a contentious task, any attempt to dismantle it will be equally contentious.  If such efforts were successful, the bi-partisan support that the SMART Act currently receives might be at risk, for purely political reasons. It seems that the potential outcome of both pieces of MSP reform would be more dependent upon the make-up of both Houses of Congress after the election, rather than who is elected as President.

Wherever the future of our state of political affairs ends up, we are hopeful that those affected by the MSP, the insurance industry as well as Medicare beneficiaries alike, will ultimately have a fair system of MSP enforcement that not only protects the Medicare Trust Fund, but also provides clear, equitable and consistent guidelines for settlements and consideration of Medicare’s interests. We trust that the future will be bright and our elected officials will ultimately continue to pursue improvements to the system.

We want to hear from you- what do you hope to get out of the 2012 Elections and where do you see the future of MSP reform going?

This blog is not intended to be an endorsement for any political party, platform, or affiliation.

1. [http://en.wikipedia.org/wiki/Patient_Protection_and_Affordable_Care_Act]
2. [ http://en.wikipedia.org/wiki/Patient_Protection_and_Affordable_Care_Act]
3. [https://www.fbo.gov/index?s=opportunity&mode=form&tab=core&id=5b5f6bb5088ed00ffe7c2b5c643ed74d&_cview=0]
4. [http://news.yahoo.com/romneys-pledge-repeal-obamacare-elected-165418907.html]
5. [http://www.mittromney.com/issues/medicare?gclid=CI2Bk7vhl7MCFRRbnAodgBwA9w]
6. [http://news.yahoo.com/romneys-pledge-repeal-obamacare-elected-165418907.html]

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