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CMS Withdraws MSP Future Medicals Rule

According to the AAJ and other sources: “CMS has officially withdrawn their proposed rule on Medicare Secondary Payer: Future Medicals.”

We don’t think the fact that CMS has temporarily withdrawn proposed regulations changes the analysis for plaintiff counsel. A client can still experience a denial of future injury related care with or without formal regulations. Medicare has issued guidance in the past in the form of memos. As you may be aware, they issued a memorandum back in September of 2011 detailing an exception of when a Medicare set aside wasn’t necessary in a liability settlement. This memo was issued by the Baltimore HQ. The fact that they told everyone when one isn’t necessary reinforces the fact that they believe they are necessary regardless of whether there is a formal regulation issued or not. They have been routine and common place in comp since 2001 without any real regulations. It is all policy memoranda driven. Until CMS comes out publicly and says don’t worry about any of this, we would still be concerned about clients who are Medicare beneficiaries and receive money towards future medicals.

In the end, it boils down to the risk you want to take as plaintiff counsel. You can choose to advise clients to ignore this issue. If they do and they have Medicare deny future injury related care, they are going to come back to you. In our humble opinion, you still have to educate the client about the potential risks involved just like you would do with a client who is on needs based benefits such as Medicaid/SSI relative to creating an SNT. We don’t see how this really changes anything.

Our analysis of this obligation was never based on proposed rules. It is based on the MSP statute and agency memoranda as well as Medicare’s stated interpretation of the MSP contained therein (which they are charged with interpreting). The fact that the agency is reworking the proposed rules does not change anything. Defendants will not understand this development. You will not see them rushing to remove MSA language from their releases. Without formal regulations, it is a bad thing since it keeps the status quo and nobody knowing exactly what to do.

So our suggested course of action remains the same: Consult, Advise and Document (“CAD”). Consult competent experts such as those at Synergy. Advise the client regarding potential implications if they are a Medicare beneficiary and receive money for future medicals. Document your file regarding what you did.

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