Archive for January, 2009

Medicare Set-Asides in Liability Settlements

As we previously reported on February 19, 2008, the new Medicare, Medicaid, and SCHIP Extension Act of 2007 requires liability insurers, including self-insurers, no-fault insurers and workers’ compensation insurers, to:
• Determine Medicare/Medicaid status for all claimants; and
• Report to the Centers for Medicare and Medicaid Services (“CMS”), the federal administrative agency responsible for administering Medicare and Medicaid, when those claims are resolved.

The Act now has additional requirements regarding how these insurers must handle the funds for the liability settlements.

With the enactment of the Medicare/Medicaid SCHIP Extension Act of 2007 (MMSEA), which went into effect July 15, 2008, a set-aside must be made concerning Medicare in liability settlements. The Act requires the withholding of Medicare payments when a payment has been or reasonably can be expected to be made by a primary plan, including a liability insurance plan. The Act also requires that, where a primary plan exists, any Medicare payment is conditioned on reimbursement by the entity that received the primary plan payment. Non-group health plans, including liability insurance, no-fault insurance, and workers’ compensation, must begin reporting the information required by the Act July 1, 2009. Failure to report as required by the Act may result in a civil penalty of $1000 per day per claimant.

For more information, please contact Timothy Buckley III, Esq. at (404) 633-9230.


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