The quantum mechanics of a CMS-approved Medicare set-aside

In my spare time, I enjoy reading and learning about the strangeness of the subatomic world. Quantum theory is difficult to understand and really hard to believe because it is counterintuitive and contrary to what we witness in reality. Quantum physics provide us with such terms and phrases as: wave-particle duality, The Higgs Boson, Schrodinger’s cat, Plank’s law, quantum tunneling, and supersymmetry, among many others. For a brief (five-minute) look into the irrational world of quantum physics, take a look at this video about the famous double slit experiment.

A lot of quantum theory is about formulas that predict approximate results because there is so much uncertainty surrounding properties in the subatomic realm. It is this uncertainty that I find compelling and applicable to the world of Medicare set-asides (MSAs).

Like the quantum world, the world of MSA approvals is shrouded in uncertainty. There are no “laws” or hard and fast rules associated with predicting the future care needs of an injured worker. They are very subjective and can be influenced by minor nuances in medical records or even the perspective of the person approving the MSA.

I am always surprised when I hear someone comment about an MSA and say “I thought the number was the number.” This sentence implies that there is certainty in coming up with an MSA amount and that it never varies. This could not be further from the truth.

When writing an MSA we are trying to predict what CMS is going to require this time it is approving an MSA. But I have found there is very rarely any certainty in how MSAs are approved. Let's call this the Merlino uncertainty principle (as compared to the one made famous by Heisenberg).

A great example of this uncertainty happened recently. For the past several years, we’ve not been allocating any funds for Lyrica in our MSAs. Based on feedback from the prior two workers’ compensation Medicare set-aside arrangement contractors, it was obvious they believed Lyrica was not covered by Medicare and therefore excluded in MSAs. We had many, many MSAs approved without Lyrica despite the fact that the employer had paid for it. 

Our prediction that CMS would not include Lyrica came to an end recently. Without warning, CMS’s new review contractor has decided to include Lyrica back into MSAs. At more than $8 per pill, this can easily add hundreds of thousands of dollars to an MSA – yet again, proving that getting CMS approval is not a science, it is an art.

Recognizing this uncertainty is half the battle. We not only recognize it, we embrace it by constantly reviewing our processes and procedures to make sure they take into account the most recent data we catalog from CMS responses. By constantly adjusting, we are positioned to make educated and reliable predictions as to how CMS will approve an MSA.

Recommendation: If you have an injured worker taking Lyrica, an alternative is to ask the doctor to replace it with gabapentin. Gabapentin is an equivalent substitute and only costs about 3 cents per pill. Make this change before you send for an MSA evaluation and you will likely be pleased with the results.   

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