- 1. Conditional Payment Processes will improve- CMS announced on December 23, 2013 that it will launch the Benefits Coordination and Recovery Center (BCRC) on February 1, 2014. The two units that will be consolidated are the Coordination of Benefits and the Medicare Secondary Payer Recovery units. They will collectively be called the BCRC, and the consolidation is aimed at creating greater efficiencies in resolving claims and eliminating confusion caused by two separate contractors. The new BCRC should accelerate conditional payment disputes and make the overall process easier. However, it has been rumored that the new BCRC will pursue conditional payment reimbursement on cases where open ORM is reported. Traditionally, Medicare only seeks reimbursement of conditional payments after a case settles or TPOC is reported. This will create additional revenue for Medicare in that it will be able to recover conditional payments on cases where future medicals remain open.
- CMS/WCRC WCMSA Processes will also improve- the WCRC should continue to improve their communication with the industry on their allocation methodology. In 2013, the WCRC issued a more detailed WCMSA Reference Guide, held their first WCMSA teleconference, and turnaround times on WCMSA approvals vastly improved. In 2014, it is expected that the WCRC will continue with their efforts to make the WCMSA process quicker, smoother and more predictable for all involved.
- Continued Divergence of Case Law on LMSAs will continue- In 2013, we saw a great deal of case law where parties to liability settlements brought their LMSA disputes to the court system hoping for resolution on the potential need for an LMSA. We had jurisdictions that refused to intervene on the LMSA issue- in Florida in the Early v. Carnival Corp. case, the court found that intervening on whether an LMSA was required would amount to issuing an “advisory opinion” and therefore the court declined opining on the need for an LMSA. However, in Mississippi in the Welch v. American Home Insurance Company case, the court not only reviewed the proposed amount of the LMSA, but increased the amount that was needed! These are just a few examples that demonstrate case law with regard to LMSAs was all over the map last year.This could potentially be resolved in 2014 if CMS continues working on the rulemaking concerning MSP and Future Medicals. As we blogged about in August of last year, CMS noted on its regulatory calendar that it was going to resume its rulemaking on this topic this past September. However, CMS did not take any further action on this topic in 2013. If CMS resumes the process on this in 2014, we could receive clarity as to obligations with regard to future medicals in liability settlements with Medicare beneficiaries.
- The SMART Act: Rulemakings will set the stage for action in 2014, however most items will not be in place until 2015 or later. In 2013, CMS issued several rulemakings pertaining to required action items from the SMART Act.
- First, CMS issued an interim final rule which would create a conditional payment web portal. While CMS is applauded for taking action on this item from the SMART Act, the interim final rule left much to be desired, with one of the main disappointments being that the roll-out deadline would be January 1, 2016. One can only hope that the comments received on this interim final rule will push CMS to roll out the portal sooner than indicated as well as resolve other issues present in the interim final rule. However, because CMS has indicated that roll-out will be January 1, 2016, it is unlikely that we will see much action on this item this year.
- Second, CMS issued an ANPRM which would carve out circumstances where penalties could be imposed for violations of MMSEA Section 111 reporting requirements. We may see some movement and actual rules carved out in 2014 for the circumstances where CMS may issue penalties. However, until the process is set into place, which will likely not be until mid-end of 2014, we will not see penalties
issued. Our prediction on this item is that actual penalties will not be issued until sometime in 2015.
- Third, CMS issued an NPRM for an appeals process to be utilized by applicable plans for conditional payment disputes. It appears likely that this appeals process could be rolled out this year, in that it is only for conditional payments (and not WCMSAs), and because it will mirror the existing appeals process currently in place for Medicare beneficiaries.
- Lastly, we will see pressure on CMS this year to create and publish an annual threshold wherein conditional payments would not have to be reimbursed and the settlement would not be reportable under MMSEA Section 111. This action item of the SMART Act should have already been in effect; CMS was supposed to publish this amount on November 15, 2013 and the threshold would have begun on January 1, 2014. But CMS did not take action on this item in 2013. We should see that pressure upon CMS from the industry aas well as MARC (who was responsible for getting the SMART Act approved) will force a hand in publishing this threshold.
2014 should be an interesting year full of MSP-related events. Count on PMSI Settlement Solutions to keep you up to date, in compliance, and ahead of the curve!