September 03, 2011

Congress and the MSP

September 03, 2011

In last month’s Newsletter, we shared information on Congressional attention being paid to the MSP.

On July 25, 2011, members of the Subcommittee on Oversight and Investigations sent a letter to the Secretary of Health and Human Services and the Center for Medicare and Medicaid Services Administrator outlining its position on the current state of the conditional payment process.  The letter discusses the great expense charged to taxpayers for CMS to recover conditional payments as low as $1.59.

The Subcommittee acknowledged CMS’ interest in balancing the solvency of Medicare against wasteful recovery efforts and requested that CMS answer questions regarding what steps have been taken to achieve this balance.  The inquiry included questions regarding whether there is a policy established to evaluate if the cost of pursuing low dollar amounts in the non group health plan setting outweighs the cost of recovery.  The Subcommittee further inquired whether CMS has considered or plans to establish a threshold dollar level to determine whether it will proceed with a claim in a non group health plan setting.

In an apparent response to these Congressional inquiries, Medicare announced a new policy effective September 6, 2011.  From September 6, 2011 onward, for liability insurance cases only, MSPRC will not recover conditional payments made if the claimant receives a settlement of $300.00 or less, and two conditions are met:

  1. The “settlement is related to an alleged physical trauma-based incident, not an alleged exposure, ingestion, or implantation, and
  2. [The claimant does] not have any additional settlements related to the same alleged incident.”

It remains to be seen whether a similar policy will be extended to the workers’ compensation arena.  Wiedner & McAuliffe will continue to monitor legislative and policy developments relating to the Medicare Secondary Payer Act, and keep you updated as additional information becomes available.