WCMSA reference guide: Things to consider

Staying in the know about what’s happening with Medicare is critical, as the changes to regulations can have an impact on workers’ compensation for payers. Recently, the Centers for Medicare & Medicaid Services (CMS) released Version 3.0 of the WCMSA reference guide. This 139-page manual serves as the all-encompassing guide to workers’ compensation Medicare set-aside arrangements. As we move forward, there are two updates to the guide to consider.  

Amended review process

In July 2017, CMS made a change to the amended review process, allowing already approved MSAs to be reviewed and approved a second time if the following conditions are met:

  • The MSA approval must have taken place within the last four years, but no sooner than one year
  • CMS has a limit of one requested amended review per MSA
  • The change in the MSA amount must be 10% of the approved MSA amount or $10,000 (whichever is greater)

In October 2019, CMS expanded the original window of approval time to six years instead of four. This change is good news because it means we can request that even older MSAs be reviewed a second time. Moving forward, we’ll be working with our clients to help determine previously approved claims that may be qualified for an amended review to help facilitate settlement.

To learn more about the 2017 changes to the amended review process, visit our previous blog post, MSAs: A second bite at the apple.

New claimant consent form

CMS has always required that the claimant execute a consent form in order for the agency to have authority to review and approve an MSA, but the consent form language hasn’t been altered in years. The updated reference guide, however, contains a significant change (effective April 1, 2020) that will impact how we process and handle MSAs in the future.

An important sentence has been added to the consent form that requires the claimant to indicate (with their initials) that they have reviewed the MSA package and understand its intent, the submission process and administration. We anticipate it will add the following complications to the MSA process:

  • The language itself is complicated, so claimants may miss or refuse to initial this new section because they don’t understand what’s being asked, which will inevitably delay submissions.
  • Who is going to “explain the submission process”? Would it be the MSA vendor, claimant’s attorney, claim examiner or a combination of all three?

These items certainly have the hallmarks of changes that will delay the proper execution of the consent form, but the biggest impact of the new consent form is on timing. Currently, getting the consent form before the MSA is completed is an efficient way to start the MSA process. It signals that the claimant is serious about settlement and interested in the getting the MSA process out of the way. As we move forward, this will no longer be an option because the consent form requires the claimant to review the MSA before executing the form. This added step may also result in delays in submitting MSAs to CMS.

Over the coming months, ahead of the April effective date, Sedgwick will refine our processes and communications to address these challenges. In the meantime, we will continue using the current consent forms to obtain CMS approval.

Visit the reference guide for more information, or leave your questions and observations in the comments field.

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