For people who have settled workers’ compensation claims or liability claims in the past, the use of professional administration for post-settlement life used to be very costly, even upwards of $30,000 driven by high upfront set up costs and annual fees attached the administration. Many people are unaware that far superior services are now available for just a fraction of that amount. Cost is one of the many misconceptions about professional administration.
“Professional administration of MSA funds post settlement is increasingly recognized by employers and injured workers as an industry best practice. A professional administrator takes the burden off the injured worker while often extending the life of the MSA funds. This creates a win-win-win situation for employer, injured worker and Medicare.”
– Rita Wilson, President of NAMSAP and CEO of Tower MSA Partners
The last 5 to 10 years have brought about significant changes regarding the way care can be accessed by injured parties post-settlement. The new low costs and high quality support provided by administrators prompted Medicare to change their WCMSA Reference Guide to include that they “highly recommend” injured parties use a professional administrator, rather than trying to self-administer their money and medical care on their own after settlement.
What’s Different
Until recently, there was very little post-settlement help available for injured parties who settled their claims. Once attorneys, insurers, and other stakeholders left the negotiation table, the injured party was left on their own to figure out how to manage their money, their medical care and their life.
Services that did exist dealt mainly with ensuring compliance paperwork was filed properly for a Medicare Set Aside (MSA). While this is a vitally important piece of managing MSA funds, it is only one aspect of what an injured party must deal with after settling their workers’ compensation or liability claim.
Top quality professional administrators now take a holistic approach to helping injured parties post-settlement. Not all professional administrators provide a complete set of services so be sure to inquire when deciding on which provider to utilize. Among the suite of services available are such things as:
- Discounted prices for doctor visits, medications and healthcare services
- Advocacy to help the injured party protect government benefits and find resources
- Bill management to review and verify all medical bills
- Access to sophisticated technology such as online healthcare portals and telehealth
- Clinical support to aid decision-making with nurse and pharmacist attention
Reporting injury-related medical expenditures to Medicare for MSAs
Professional administration is now extremely cost-effective; so much so, that it benefits both injured parties with lower priced settlements, as well as those involving millions of dollars.
The Evolution
Prior to the early 2000s, there were virtually no organizations dedicated to helping injured parties post-settlement. People with extremely high future medical costs would consider setting up a trust and had a professional trustee (usually an attorney or bank) administer the funds. These programs were customized and extremely costly.
The holistic concept of post-settlement advocacy is relatively new and started with a Medicare directive and guidance issued in 2001. A federal statute was initially passed in 1980 mandating that Medicare’s liability must be considered as secondary to the liability of non-group health plans, including workers’ compensation. But the MSPA lacked the details to make it truly effective. That changed some 21 years later.
A memorandum from an executive at Medicare known in the industry as the “Patel Memo”, gave details on how compliance with the MSPA should be achieved in workers’ compensation cases whenever the settlements included future medical expenses. It was circulated to the insurance industry by the Centers for Medicare and Medicaid Services (CMS), the federal agency that administers Medicare.
The memo suggested that workers’ compensation claims could voluntarily verify with CMS that they are properly considering CMS’s “interests” in the settlement to be the secondary payer. It helped establish a process in which CMS would review the settlement and approve a “Medicare Set-Aside” allocation that would need to be spent properly before CMS would pay for bills related to an injury that had been settled. CMS also requested that the injured party send in annual reporting on how they spent their MSA funds. Even though there was, and still is, no regulation that explicitly requires an MSA account be sent to CMS for review, the idea that Medicare could deny care for an injured party that did not use their settlement funds years after the settlement turned the workers’ compensation industry on its ear.
Almost overnight, a niche industry was born. Many attorneys familiar with the settlements industry ventured to develop MSAs that would be successfully reviewed and approved by CMS as insurance carriers, third party administrators, and self-insured employers sought to develop processes to protect Medicare’s interest. MSAs became the primary method to develop the allocation amount but ensuring the injured party spent the funds appropriately after settlement was not always top of mind for many stakeholders.
Then and Now
As MSAs became more prevalent, some in the industry began to wonder how injured parties would manage the myriad of rules and regulations involved after the case settled. Creative MSA vendors realized they could not only develop the MSAs, but administer the funds for injured parties after they settled their claims as well. These mainly “mom and pop” companies would ensure medical treatment was covered by Medicare, cut the checks from the MSA account, and handle the required paperwork, but the costs for these services were very high, often with a $3,000 start-up fee followed with another $1,000 per year. The cost could easily exceed $40,000 during a person’s lifetime. This is where Ametros and true “professional administration” as is offered today started coming into play.
With an up-front cost of $1,500 and annual fee of $450, Ametros seemed like a better deal than what had previously existed. Ametros was able to leverage technology and sound business practices to drastically lower the cost for professional administration services, leading the way for lower costs across the industry. Ametros hired experts in all facets of medical services and gained traction with some of the larger insurance carriers and stakeholders at the settlement including structured settlement brokers, and plaintiff attorneys. Rather than handling only the MSA reporting requirements, Ametros considered all the needs the injured party would face post-settlement.
“Professional administration is the best way to ensure an injured party’s medical funds and future Medicare benefits are protected. While administration used to be a costly add-on, it is quickly become the standard when settling a case with a future medical component regardless of the size of the case.”
– Leslie Schumacher, RN, CRRN, CCM, LNCC, CLCP, CNLCP, MSCC, CMSP, Founder, President, PlanPoint
For the first-time clinical professionals were brought on to help injured parties not only find quality medical services but to understand and make informed decisions about the care they receive. By partnering with various medical networks, Ametros now offer discounted prices for medical care and pharmacy to their members, which includes complex networks and arrangements that drive significant discounts to injured parties.
Prices have come down even further in the last 5 years, with some charging as little as a one-time fee of $2,000. This has opened up organizations, like Ametros, to be able to help all injured parties post-settlement, regardless of the size of their settlement funds. Injured parties with run-of-the-mill $15,000 settlements can now reap significant benefits from these newer professional administration companies and the various services that are offered to help the injured party not only remain in compliance, but save money, access sophisticated technology, and have clinical insights
The Future
When Ametros explains the service, it is not uncommon for an audience member to ask whether such help is available for people outside the post-settlement realm. People with elderly parents, for example, often need help navigating the complex healthcare system, and even younger people can see the value in such a service.
Insurers are increasingly looking to utilize professional administrators to help them ease concerns the injured party and attorney may have regarding settlement, knowing they will get the assistance they need afterward. It is clear, that when an injured party gets access to various benefits post-settlement, they are more likely to be interested in settlement, which means a win-win for all parties to a settlement.
Where any of this will lead is unknown, but what is known is the future of professional administration is wide open.
