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Timely Topics: A Valuable Practice Pointer on Section 111 Reporting

My world in recent months has afforded me the opportunity to learn a great deal about Medicare Set Asides (MSAs) and how they are managed. This is not a practice akin to science. I have also been given the opportunity to learn from others who have been in this practice area for years, calling them experts would be appropriate. I’ve shared what I’ve learned and, in the process, developed ideas on how this practice could be improved. I’ve had numerous opportunities to meet members of several state bars who have been welcoming, engaging, and open to sharing.  

Recently at a jurisdictional bar association meeting an old friend who represents claimants, or as characterized in some states, employees or injured workers, asked what I have learned in recent months about MSAs that would be most helpful to the claimant bar. After some thought I provided an answer. On reflection I think my answer is helpful to the entire workers’ compensation bar but is most valuable for those representing injured workers.  

Workers’ compensation attorneys in many jurisdictions have a reputation of being more cavalier and less precise in their pleadings and in trial presentations than our civil litigation counterparts. Having been one, I understand the perception. The fact that we usually do not have either the traditional Rules of Civil Procedure or Rules of Evidence apply to our practices explains the root of this impression. In workers’ compensation, most states have modified Procedural Rules and as often as not we have something like the Administrative Rules of Evidence. Both are Rules but are typically seen as relaxed versions of those applicable to matters filed in our Trial Courts. With imprecision in mind, I responded to the inquiry saying I have become very concerned about how a claimant’s injury might be described. I went on to ask how often this attorney requests information around a carrier or self-insured’s Section 111 reporting information on specific claims involving Medicare beneficiaries.

The reaction was one where you might have thought I was speaking in a foreign tongue. A brief discussion followed where I, in as straight forward a fashion as possible, explained that insurance carriers and self-insureds (known as Responsible Reporting Entities [RREs]) are obligated to report under Section 111 of the Medicare, Medicaid SCHIP Extension Act (MMSEA) of 2007, with Centers for Medicare & Medicaid Services eligible claimants.

Section 111 obligations have existed for over a decade now and claim files contain a substantial amount of data. Most pertinent, however, is the applicable ICD injury codes associated with the claim. Failure to report these codes and other data elements and attributes could result in a substantial fine – up to $1,000 per day, per claim.

This attorney was told this filing informs CMS about his client’s injury. This reporting could be the information against which CMS assess who is responsible for paying for medical treatment, facility charges, and medication. This attorney was unaware of this CMS filing obligation. We discussed how and if he should secure copies. The ‘how’ is easy: request information from the carrier or file a discovery request. Putting on my old claimant counsel hat the “if” question was answered with an unequivocal “yes.” Knowing what is being reported allows counsel to verify its accuracy and helps to understand the carrier’s assessment of the claim. 

Why is this important? Once the case settles, the Section 111 filing might be the only clear statement on a claimant’s injury. It could very well be the yardstick CMS uses to determine whether it is obligated to pay a medical bill or if it is a secondary payer, the Medicare Set Aside being the primary payer.  

This conversation evolved into a discussion about the potential importance of a decision rendered by an Administrative Law Judge at the time of settlement and the Judge’s finding on the nature and scope of a claimant’s injury. I explained some years ago CMS advised in a memo that if a state workers’ compensation Judge held a hearing on the merits of a claim and made a finding on the nature and scope of an injury, CMS would accept that finding. The judge’s determination would be the yardstick against which future medical charges would be assessed. CMS in its most recent Medicare Set Aside Arrangement Reference Guide, one dated January 4, 2019, at section 4.1.4, appears to again be prepared to accept the Judge’s finding if Medicare’s interest was addressed at the hearing. At a meeting in Baltimore in September, a CMS executive was asked if a finding made by a judge would supersede a Section 111 filing on an injured workers injury, his response was a reassuring: “It would.”   

So, to answer my friends’ question, with some supplementation added to this writing, I have learned the bar on both sides of a claim can do the injured worker a significant service by insuring the worker’s injury is accurately described in the carriers’ Section 111 reporting. In addition, if there is a hearing on the merits of the case and/or a formal settlement hearing, counsel can do the system and, specifically, the injured worker a service by again developing evidence, with sensitivity to CMS’ interests in mind on the nature and scope of the claimant’s injury.  

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