Medicare and Workers' Compensation Interaction: Crucial Details Explained
Working with Medicare and Workers' Compensation: All You Need to Know
Navigating the overlap between workers' compensation and Medicare is crucial to avoid claim denials, and potential reimbursement obligations. Workers' compensation provides insurance for employees who have suffered work-related injuries or illnesses.
Handled under the Department of Labor's Office of Workers' Compensation Programs, this benefits system applies to federal employees, their families, and specific entities. Understanding the effects of workers' compensation on Medicare coverage is vital to manage work-related medical costs effectively.
Interplay of Workers' Compensation and Medicare
As per Medicare's secondary payer policy, workers' compensation must cover any treatment for a work injury before Medicare steps in. However, if immediate medical expenses arise prior to the recipients' workers' compensation settlement, Medicare may cover the initial costs and initiate a recovery process managed by the Benefits Coordination & Recovery Center (BCRC).
To avoid recovery processes and ensure that Medicare covers only the appropriate portion of claimants' medical expenses, the Centers for Medicare & Medicaid Services (CMS) usually monitors the amount received by claimants from workers' compensation for injury-related medical care. In some cases, Medicare might ask for the establishment of a workers' compensation Medicare set-aside arrangement (WCMSA) for allocated funds. Medicare will only cover the care after all the money in the WCMSA has been exhausted.
Settlements to Report to Medicare
Workers' compensation must submit a total payment obligation to the claimant (TPOC) to CMS to ensure Medicare covers the right portion of claimants' medical expenses. Reporting is necessary for individuals already enrolled in Medicare based on age or Social Security Disability Insurance and for settlements of $25,000 or more. Additionally, reporting is necessary if the person is not yet enrolled in Medicare but will qualify for the program within 30 months of the settlement date, and the settlement amount is $250,000 or more. On top of workers' comp, a claimant must also report to Medicare in case of filed liability or no-fault insurance claims.
Frequently Asked Questions
You can get in touch with Medicare or the BCRC regarding your concerns by phone at 800-MEDICARE (800-633-4227, TTY 877-486-2048). During certain hours, a live chat is also available on Medicare.gov. If you have questions about the Medicare recovery process, contact the BCRC directly at 855-798-2627 (TTY 855-797-2627).
A Medicare set-aside is voluntary. However, if a Medicare beneficiary wants to set one up, their workers' compensation settlement must be over $25,000, while if they are eligible for Medicare within 30 months, the settlement must exceed $250,000. It is prohibited to use the money in a Medicare set-aside arrangement for any purpose other than its designated purpose, as misusing the funds could result in claim denials and reimbursement obligations.
"Learn more: Everything You Need to Know About Medicare Set-Asides"
Takeaway
"It's required by law for Medicare beneficiaries to inform Medicare about their workers' compensation settlements, with reporting deaths handled by the responsible reporting entity (RRE). The RRE typically includes the employer, insurer, or their representative who makes the settlement payment. The reporting process involves registration with CMS and detailed information about the case, parties involved, and settlement terms. Failing to report can result in penalties, with Medicare potentially recovering double the amount of payments owed. This reporting ensures Medicare's interests are protected by coordinating benefits and preventing Medicare from paying for treatment that should be covered by workers' compensation."
Medicare resources
For further guidance in navigating the complexities of medical insurance, visit our Medicare hub.
- Medicare health systems should monitor the amount received by claimants from workers' compensation for injury-related medical care to avoid recovery processes and ensure they only cover the appropriate portion of the claimants' medical expenses.
- In some cases, Medicare might ask for the establishment of a workers' compensation Medicare set-aside arrangement (WCMSA) for allocated funds, and Medicare will only cover the care after all the money in the WCMSA has been exhausted.
- Medicare beneficiaries must inform Medicare about their workers' compensation settlements, as failing to report can result in penalties, with Medicare potentially recovering double the amount of payments owed.
