With the release of the WCMSA Reference Guide v4.4 (July 2025), updated Self-Administration Toolkit v1.7, and the rollout of the Notice of Settlement Received letter, the Centers for Medicare & Medicaid Services (CMS) has made it clear: professional administration of Medicare Set-Asides (MSAs) is more important than ever.
But with increased attention comes increased confusion. Let’s set the record straight on ten of the most common myths surrounding MSA administration and what the facts really are.
Myth #1: The cost of items and services listed in an MSA is exactly what you’ll pay providers and pharmacies.
False.
Fact:
The costs listed in an MSA allocation are estimates based on a case-by-case analysis that considers:
- Payment histories
- Applicable fee schedules
- Evidence-based guidelines
- Provider charges
- Usual and customary rates
- CMS-specific pricing methodologies
Actual post-settlement costs can vary significantly. A professional administrator may be able to secure lower rates through established provider and pharmacy networks, potentially reducing overall medical expenses and extending the life of the MSA.
Myth #2: An MSA can only be used for items and services listed in the original allocation report.
False.
Fact:
An MSA is intended to cover Medicare-eligible expenses related to the underlying workers’ compensation injury, not just those itemized in the original report. According to the WCMSA Reference Guide v4.4, Section 3.0, a portion of the WC settlement is allocated for future medical expenses that are related to the injury and Medicare-covered.
CMS clarifies in the Self-Administration Toolkit v1.7, Section 8:
“It is not important if what you spend from your WCMSA does not match how you expected to spend it.”
For example, if your MSA allocates $7,000 for prescriptions and $3,000 for medical expenses, but you spend $6,000 and $4,000 respectively, you’ve still used the account correctly.
Annual attestation to Medicare’s Benefits Coordination & Recovery Center (BCRC) is required within 30 days of the settlement anniversary. A professional administrator ensures accurate tracking and timely submission of these attestations.
Myth #3: Traditional Medicare is not denying payments.
False.
Fact:
Medicare does deny claims when it believes MSA funds are available. Per the WCMSA Reference Guide v4.4, Section 18.0, CMS uses electronic markers to track MSA usage and prevent Medicare from paying for injury-related services until the MSA is properly exhausted.
Timely and accurate attestation is essential. As stated in the Self-Administration Toolkit v1.7, Section 8:
“CMS will continue to deny claims related to the WC injury until final exhaustion attestation is received and documented.”
Professional administrators help ensure compliance and prevent unnecessary claim denials.
Myth #4: Medicare Advantage Plans (MAPs) do not deny payments.
False.
Fact:
Medicare Advantage Plans (Part C) also receive MSA data from CMS and are instructed to deny coverage for injury-related treatment that should be paid from the MSA. While their data access may be less detailed than traditional Medicare, MAPs are increasingly coordinating benefits with MSAs.
In 2024, 54% of Medicare beneficiaries were enrolled in a MAP. The WCMSA Reference Guide v4.4, Section 4.1.3 confirms that:
“A WCMSA is primary to all Medicare coverage related to your settled illness or injuries and must be exhausted before using other Medicare benefits.”
MAP and Part D sponsors are required to avoid paying expenses that should be covered by the MSA.
Here’s your revised content with improved clarity, grammar, and flow, while maintaining a professional tone and structure:
Myth #5: Medicare recommends self-administration over professional administration
False.
CMS does not prohibit self-administration if permitted by state law. However, it clearly states:
“Although beneficiaries may act as their own administrators, it is highly recommended that settlement recipients consider the use of a professional administrator for their funds.”
(WCMSA Reference Guide, v4.4, Sec. 17.1)
Professional administration is especially important when a claimant is prescribed controlled substances that CMS classifies as “frequently abused drugs” under its Part D Drug Utilization Review (DUR) policy.
Administering an MSA is complex. CMS strongly recommends professional administration to ensure proper care, coordination of benefits, and protection for all parties involved post-settlement.
Myth #6: Professional administration is only for individuals who lack the capacity to manage an MSA
False.
While CMS requires that an MSA be managed by a “competent administrator,” it does not limit professional administration to individuals with diminished capacity. If an injured party has a court-appointed guardian or has been declared incompetent, that information must be included in the MSA proposal.
(WCMSA Reference Guide, v4.4, Sec. 17.1)
However, CMS highly recommends professional administration for all settlement recipients, regardless of their capacity or circumstances. It can benefit any injured individual by ensuring compliance, proper fund usage, and peace of mind.
Myth #7: Professional administration is only for WCMSAs
False.
Professional administration is beneficial for any settlement involving post-settlement medical funds—not just Workers’ Compensation Medicare Set-Asides (WCMSAs). It helps preserve public benefits such as Medicaid, SSDI, and SSI, and can provide access to provider and pharmacy discounts that extend the life of the medical fund.
Additionally, professional administrators assist with care coordination, relieving the injured party of the burden of managing bills and determining treatment eligibility.
Myth #8: Attestation to Medicare doesn’t matter
False.
Attestation is essential to ensure Medicare does not deny coverage. Submitting annual attestation to Medicare is a critical part of MSA administration.
(Self-Administration Toolkit for WCMSA Arrangements, v1.7, Sec. 8)
If the MSA is temporarily depleted or fully exhausted—especially in annuity-funded cases—a professional administrator ensures timely attestation and proper coordination of benefits, preventing Medicare denials. Given the technical complexity of electronic submissions, a professional administrator is best equipped to handle this process accurately.
Myth #9: Professional administration is costly
False.
The cost of professional administration is typically a small fraction of the total medical portion of a settlement. In many cases, it is significantly less than the cost of the MSA itself. For example, Ametros charges only a nominal administrative setup fee.
This modest investment provides:
- Extended life of the medical fund
- Potential savings on medical, prescription, and DME costs
- Finality and clarity in settlement execution
- Support and guidance for the claimant
- Proper fund usage and compliance
- Timely attestation to Medicare
- Peace of mind for all parties
Protecting Medicare’s interests doesn’t end with establishing an MSA—it must also be properly administered. As CMS increases its focus on post-settlement compliance, understanding the facts is critical for making informed decisions.
Myth #10: The professional administrator works for the insurance company
False.
A professional administrator is bound by CMS guidelines and the terms of the final workers’ compensation settlement. The WCMSA account can only be used for Medicare-covered treatment and prescriptions related to the injury.
(Self-Administration Toolkit for WCMSA Arrangements, v1.7, Sec. 4)
Professional administrators offer access to provider discounts, detect billing errors, and prevent payment for unrelated conditions.
*This is an updated document that was originally authored by Shawn Deane on January 9, 2020.
