NAMSAP Bulletin Provides a Sneak Peek into CMS’ LMSA Review Program

Last week, the National Alliance of Medicare Set Aside Professionals (NAMSAP), through their Liability Medicare Set Aside (LMSA) Committee issued a special edition bulletin about LMSAs.  The bulletin described an April 16, 2018 meeting between NAMSAP members and the Centers for Medicare & Medicaid Services (CMS).  The informational bulletin, which is subject to change until CMS provides official guidance, addresses some highlights of the discussion between CMS and NAMSAP.

Based upon the bulletin, here’s what to expect in a LMSA review program:

 

  • The LMSA review program will not be rolled out sooner than October 2019.
  • The review program will be voluntary, as with workers compensation Medicare-Set Asides (WCMSA).
  • The enforcement of a LMSA (as with WCMSAs) is the denial of services.
  • Review of a LMSA will occur only if settlement has been reached.
  • CMS will publish a LMSA Reference Guide.
  • The voluntary review program will be available for Medicare beneficiaries or injured parties who have a reasonable expectation of Medicare eligibility within 30 months.
  • A minimum workload threshold of $250,000 is anticipated.
  • For settlements between $250,000 and $750,000 threshold, CMS will apply “a formula” to determine the LMSA amount.
  • Any LMSA above $750,000 level is a full commutation, in that a traditional MSA as with workers’ compensation claims, would be prepared and, if submitted to CMS, evaluated by CMS for adequacy.

Within this meeting, CMS also indicated that per the statute, Medicare’s interest must be considered in every claim.  CMS also suggested that a LMSA is exclusively the responsibility of the plaintiff and made it clear to the meeting attendees that the defendant(s), and their insurers, are not a target.

Takeaway and commentary:

As we have learned in the past, statements by CMS are subject to change and certainly a lot can change over the next 14 months or so.  That being said, one of the most interesting points coming out of the CMS-NAMSAP meeting is the statement that CMS perceives LMSAs are the responsibility of Plaintiffs.  This statement is somewhat alarming, given the fact that much of attaining Medicare Secondary Payer compliance is in fact dependent on both parties working together.  Without both parties conferring to achieve MSP compliance, settlement may be stopped dead its tracks.  Moreover, how can parties be sure that Medicare’s interests have been adequately considered, if not both involved in the LMSA process?  Perhaps CMS will provide additional clarification down the road.

Again, a lot can change in the next 14 months.  Recall that we saw a case last year, Silva v. Burwell, No. 16-cv-488 JCH/KK, 2017 U.S. Dist. LEXIS 195032, which at best only perpetuated the confusion surrounding LMSAs because CMS was unwilling to take a position as to whether a LMSA was in fact required.  InSilva, the Court opined “…that there is no law or regulation currently in place that requires the CMS to decide whether Plaintiff is required to create a MSA for personal injury settlements.  [However]…CMS provides no other procedure by which to determine the adequacy of protecting Medicare’s interests for future medical needs and/or expenses in conjunction with the settlement of third-party claims.” Id. at 12.  This brief bulletin gives us a sneak peek at the procedure CMS is considering implementing to determine whether Medicare’s interests have in fact been adequately protected.  It is likely more information will be shared in the coming months.  In the meantime, NAMSAP will be discussing LMSAs at their annual conference and will be possibly holding a webinar in the near future.  We will be sure to update our readers on additional developments.

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