By B. Joshua Pettingill & Jason D. Lazarus
The hiring of a Medicare Set Aside (“MSA”) allocation vendor is an important decision when settling a worker’s compensation or liability matter. The future medical costs included in the allocation report can make or break a case. If the MSA allocation is too high, it may hurt the chances of settling the case. If the allocation is too low due to improper calculation of the future medical care covered by Medicare, CMS is not going to approve the MSA. Failure to obtain CMS approval of an allocation can cause a contingent settlement to disintegrate.
Hiring the right MSA vendor is critical to successful conclusion of a case involving a Medicare beneficiary where an MSA will be implemented. Here are ten questions to help guide your decision making process when searching for a MSP compliance partner:
- Does the MSA allocation vendor do work for plaintiffs or insurance companies?
- Are the vendor’s owners & employees certified Medicare set aside consultants (MSCC)?
- What other qualifications and designations do their allocators have?
- Does the vendor have proper E & O coverage?
- Has vendor ever been sued as a result of the work performed?
- Does the vendor more than one person who reviews the MSA before the final report is completed?
- Does the vendor handle liability claims differently than worker’s compensation claims?
- What is their average turnaround time to hear back from CMS?
- What calculations are included in the analysis?
- Can they provide a funding analysis of the MSA using a structured settlement?
You should be very leery of vendors who make outrageous claims such as, “guaranteed acceptance by CMS”. There are MSA vendors who continue to market using these false claims. The problem with this practice is the MSA allocation amount may be overly inflated so CMS will approve it automatically. This can cost the insurance carrier more in terms of settlement dollars. More importantly, an overinflated MSA allocation amount will result in less upfront cash for the plaintiff.
You should also avoid MSA vendors who advertise “lowest defensible allocations”. When a MSA is prepared, there is a very strict methodology that must be employed to comply with CMS guidelines. If the MSA is being submitted to CMS for approval, the Medicare contractor evaluating the allocation is going to review all of the accompanying documentation for both medical treatment and prescriptions. If the allocation amount is too low, they are going to flag the report and revise the amount upward. Once that happens, you are at the mercy of CMS. There is no formal appeal process if CMS comes back with a significantly higher number in place of the artificially low number submitted by an MSA vendor.
A properly calculated MSA allocation should have a rational basis in the medical records and bills attributable to the injury related care prior to settlement. It is imperative to hire a firm who has the experience, knowledge and ability to guide you through all of the pre-settlement, settlement and post-settlement issues that may arise with Medicare Secondary Payer compliance. More importantly, the right experts can insure you and your client are fully protected so you do not have to worry about unforeseen litigation after the claim has been resolved.
To learn more about how Synergy can help with Medicare Secondary Payer compliance and Medicare Set Asides, click HERE.