Thursday, June 25, 2015

Case Study: Are Unnecessarily High MSAs Driving your Settlement Out of Range?

Quite often we are asked to provide second-opinion review of MSA allocations that were prepared by another vendor.  We have consistently found that a majority of those allocations are incredibly inflated and include unnecessary treatment and medications.  Though inflated MSA allocations help ensure a high CMS approval rating, they drive many settlements out of range.  In cases that are able to settle, they cost a tremendous amount of money that simply does not need to be spent on MSAs.

To illustrate this point, we decided to highlight a file we recently reviewed which resulted in the client saving $160,034.  In this case, the employer/insurer planned to settle below the $25,000 CMS review threshold. The treating physician had provided written confirmation that the claimant, a Medicare beneficiary, would "not need future medical care related to [the] work injury or illness based on a reasonable degree of medical certainty."  However, uncertain of how CMS would view the case, the employer/insurer referred the file to another vendor for advice.

Unfortunately, that vendor lacked experience and understanding of CMS guidelines.  They didn't recognize that an MSA was completely unnecessary in the case!  The client should have been told that CMS had clearly stated in a memorandum issued on April 22, 2003, which was incorporated into the WCMSA Reference Guide, that an MSA is not necessary when the following conditions are met:

• The facts of the case demonstrate that the injured individual is only being compensated for past medical expenses (i.e., for services furnished prior to the settlement);
• There is no evidence that the individual is attempting to maximize the other aspects of the settlement (e.g., the lost wages and disability portions of the settlement) to Medicare’s detriment; and
• The individual’s treating physicians conclude (in writing) that to a reasonable degree of medical certainty the individual will no longer require any Medicare-covered treatments related to the WC injury.

Instead of advising the client that an MSA allocation was completely unnecessary, the vendor prepared and charged the client for a $160,034 MSA.  The allocation included medications that were no longer prescribed, treatment for an unrelated condition, a surgery that the treating physician clearly noted was not recommended and treatment that was not even covered by Medicare.  Relying on our advice and the WCMSA Reference Guide, the client was able to settle the claim as originally planned, well below the CMS review threshold.

We describe scenarios like this in terms of buying a car.  If you go to a dealership and offer to purchase a car for $10,000 above sticker price, of course your offer will be accepted and you'll get a new car.  You'll also have made the salesperson and dealership very happy!  However, most of us use better judgment and don't conduct business like that.  We try to save as much of our money as possible while getting a good quality, reliable vehicle.  We firmly believe that our clients are much better served by our knowledge, experience and aggressive advocacy skills when it comes to Medicare Compliance issues.  We help ensure that Medicare is protected while also conserving our client's resources as much as possible.  Though we may lose money on individual cases when we advise clients not to pay us to prepare MSA allocations that aren't necessary, we prefer to build trusted relationships with them that last for years.

If you have an MSA allocation you feel is unnecessarily high or that has priced you out of settlement range, let us know.  We would be happy to prepare a second-opinion review to see if we can save you money while ensuring that you are in complete compliance with Medicare Secondary Payer laws, regulations and guidelines.

IMRs in California Accepted by CMS in Carr Allison MSA Allocations

Under California workers' compensation law, as of July 1, 2013, medical treatment disputes for all dates of injury are resolved through the Independent Medical Review (IMR) process. Specifically, Section 4610.6(g) of the California Labor Code provides that "[t]he determination of the independent medical review organization shall be deemed to be the determination of the administrative director and shall be binding on all parties."

As a general matter, CMS should recognize a binding decision on the merits under state law that certain treatment or prescriptions are not compensable.  However, last year we discussed the IMR process with CMS and were informed that the WCRC, the CMS contractor that reviews MSAs, had not been giving appropriate consideration to IMR Final Determinations in cases submitted by other vendors.  The contractor simply did not understand the binding nature and legal effect of IMR Final Determinations.

Carr Allison was at the forefront of discussions with CMS regarding IMR Final Determinations and WCMSA policy, explaining the IMR process and applicable section of the California Labor Code to the CMS Central Office.  We are pleased that those efforts paid off, as CMS has recognized IMR Final Determinations following our discussions.  In fact, in a very recent case, we negotiated a $66,438 MSA reduction with CMS based on the findings of an IMR Final Determination.  CMS agreed to exclude medications that were found by the IMR Final Determination to not be reasonable or necessary.

As a law firm, we are committed to aggressively advocating to CMS any legal basis for reducing MSAs.

If you have any questions about reductions based on IMR Final Determinations or applicable state laws, please do not hesitate to contact us.

CMS Alert: Matching Criteria for SSNs

On June 18, 2015, CMS issued an Alert entitled "Modification of Matching Criteria Used When Reporting Partial Social Security Numbers for Liability Insurance (Including Self-Insurance), No Fault Insurance, and Workers’ Compensation."  The text of that alert is copied below:

New Matching Criteria for Partial SSNs
In order to determine if individuals are Medicare beneficiaries, the following information is used:
•HICN or SSN
•First initial of the first name
•First 6 characters of the last name
•Date of birth (DOB)
•Gender

Effective immediately, the matching criteria for partial SSNs will be changed. When an exact match on the partial SSN is found, then four out of the four remaining data elements must be matched to the individual exactly. The matching criteria for HICNs and full SSNs will remain the same.

Reporting Compliance Considerations
NGHP RREs are encouraged to submit the HICN or full SSN when available to ensure the most accurate match is attained. Failure to match to a Medicare beneficiary with the full or partial SSN does not negate the RRE's Section 111 mandatory reporting requirement when a reportable claim exists.

The entire alert can be found here.

Wednesday, June 24, 2015

Section 111: Rule on Penalties Not Expected Until December 2016

Under the SMART Act, CMS is supposed to issues rules specifying "practices for which sanctions will and will not be imposed."  In December, 2013, CMS issued an Advanced Notice of Proposed Rulemaking seeking comments on circumstances in which penalties should and should not be imposed.  The comment period closed in February, 2014 and since then the industry has been awaiting proposed rules from CMS.  After CMS issues proposed rules, the public will be allowed to submit comments during a 60 day period, and then CMS will issue final rules.

Previously, CMS had indicated that they would issue proposed rules in July, 2015.  However, CMS has now indicated that they will not be issued until December, 2016.  Of course, it is possible that this time frame will change again and that CMS will issue proposed rules at a later date.  We will continue to keep you updated and let you know once any proposed and final rules are issued.  Until they are, RREs should focus on ensuring that they are reporting under Section 111 correctly and not be overly consumed with fear of retribution from CMS.
If you have questions or would like an audit of your Section 111 reporting program and processes, please let us know and we will be happy to help.

Tuesday, June 23, 2015

Melisa Zwilling named 2015 Woman Leader in the Law by Fortune Magazine



Congratulations to Carr Allison Medicare Compliance Group Chair:


For the second year in a row, Ms. Zwilling has received the honor of being named one of Fortune Magazine's Women Leaders in the Law. Congratulations on your achievement!

Tuesday, June 16, 2015

Upcoming Event: Iowa Workers' Compensation Symposium



Join us!

 53rd Annual Iowa Workers' Compensation Symposium
June 18-19, 2015
Des Moines Marriott Downtown

Stop by
 Booth 18
and register for your chance to win a $100.00 VISA gift card

Friday, June 5, 2015





We look forward to seeing you at the
  18th Annual Tennessee Workers' Compensation Educational Conference, this week, June 8-10 
at the Nashville Airport Marriott

Stop by Booth #18 and drop off your business card for a chance to win a Visa Gift Card!