Avoiding a Medicare Set-Aside (MSA) is generally not recommended if your settlement includes future medical expenses that Medicare might cover, as this could lead to a cost-shift to Medicare. It's important to ensure compliance with the Medicare Secondary Payer (MSP) laws to protect Medicare’s interests.
Responsibilities Under MSP Laws
Under MSP laws, all parties involved in a workers' compensation case must protect Medicare’s interests when resolving cases with future medical costs. These laws aim to prevent Medicare from covering expenses that should be the responsibility of another party.
Risks of Avoiding Medicare Set-Aside
Disregard of Settlement: Attempting to shift the financial responsibility for medical expenses to Medicare can lead to your settlement being disregarded. According to 42 CFR 411.46(b)(2), settlements intended to circumvent Medicare’s interests may be invalidated.
CMS Non-Compliance Consequences: If a Workers’ Compensation settlement is reached without CMS approval for an MSA, CMS is not bound by the MSA amount specified. This means CMS may refuse to pay for future medical expenses related to the injury.
Potential Refusal to Pay: CMS has the authority to refuse payment for certain expenses related to the injury until the settlement is entirely exhausted, as noted in the WCMSA Reference Guide, v3.1, Sec. 3.
Right of Recovery
Medicare holds a priority right of recovery against any entity receiving part of the settlement payment, ensuring its interests are protected financially. Detailed guidance can be found in the WCMSA Reference Guide, v3.1, Sec. 3.
For further information about Medicare Set-Asides and compliance, visit Medicare’s official MSA webpage.
