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URGENT Alert – Liability Medicare Set-Asides: CMS Announces Proposed Rule-Making for LMSAs

A proposed rulemaking on “Miscellaneous Medicare Secondary Payer Clarifications and Updates” was just posted on the Office of Management and Budget website.

The abstract of the rule says: “This proposed rule would ensure that beneficiaries are making the best health care choices possible by providing them and their representatives with the opportunity to select an option for meeting future medical obligations that fit their individual circumstances, while also protecting the Medicare Trust Fund. Currently, Medicare does not provide its beneficiaries with guidance to help them make choices regarding their future medical care expenses when they receive automobile and liability insurance (including self-insurance), no-fault insurance, and workers’ compensation settlements, judgments, awards, or payments, and need to satisfy their Medicare Secondary Payer (MSP) obligations.”

Key Takeaways for Trial Attorneys:

  • This is the first time this proposed rule has been published in the Unified Agenda.
  • The proposed rule is earmarked as “Economically Significant” regarding priority level.
  • It cites the legal authority to make this proposed rule change is 42 U.S.C. 1395y(b) of the Medicare Secondary Payer statute.
  • There is no deadline listed for when the rule may take effect, but it provides that a Notice of Proposed Rulemaking (NPRM) will be issued by September 2019.

This official CMS communication is the latest evidence to support that CMS is continuing its pursuit of establishing formal guidelines for liability MSAs. CMS started the regulatory process for liability set-asides with the Advanced Notice of Proposed Rulemaking (ANPRM) proposal in May 2012.  However, in October 2014, CMS withdrew its Notice of Proposed Rulemaking (NPRM) for protecting Medicare’s interests with respect to future medicals. Until CMS provides formal guidance on these issues to plaintiff attorneys, Synergy will continue to advocate for techniques that lower the MSA or eliminate the MSA obligation.

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