The Medicare Secondary Payer (MSP) statute is a federal statute that governs the receipt of Medicare payments. Under the statute, Medicare is a secondary insurer that may only be used after an individual exhausts any other available means of insurance. Accordingly, in workers compensation claims, workers compensation should be the primary source of medical insurance coverage.
The MSP statute states that if the plaintiff intends to settle with workers compensation for an amount greater than $250,000 and anticipates future medical treatment, the plaintiff must allocate a specific portion of the settlement to a Medicare Set Aside account (MSA). If the injured individual exhausts his MSA allocation, then he may receive Medicare payments. This account protects Medicare’s interests as a secondary insurer.
Generally, the plaintiff’s lawyer or insurer will hire a financial consultant to determine the size of the MSA. This account must then be approved by the Center for Medicare and Medicaid Services (CMS). The plaintiff must also file annual accountings with the CMS until she exhausts the fund. Following proper protocol is extremely important because if an individual fails to do so, CMS can deny future Medicare payments.
Understanding the complexities of Medicare can be a frustrating experience for an injured worker. If you or a loved one were injured in a work-related incident, you may have legal rights. For questions, contact Broussard, David & Moroux at 1-888-337-2323 (toll free) or 337-233-2323 (local).