CMS Withdraws Proposed Liability MSA Rulemaking

by Patrice Freeman, Medicare Set-Aside Consultant Certified (MSCC)

On Oct. 8, 2014, the Centers for Medicare & Medicaid Services withdrew its June 15, 2012 proposed rulemaking which dealt with future medicals for Medicare Set-Aside Liability claims settlements.

Many law firms and industry insiders were disappointed with this development because it was hoped that this proposed regulation would bring more clarity to how liability Medicare Set-Asides should be set up and administered.

Since this was only a proposed regulation, subject to public comment and further modifications, this withdrawal does not change anything for plaintiff attorneys who handle liability cases. It leaves the legal community with the same requirements and guidelines for liability MSAs that have been in existence for years.

Simply put, the parties to a liability claim must still review each fact pattern in a liability case and look to the Medicare Secondary Payer (MSP) law to determine if an MSA should be set up and administered. Medicare's interest still needs to be protected when a liability case is settled.

Over the years, CMS has issued numerous memorandums on Medicare Set-Asides but most have provided guidance on MSAs that originated from a Workers Compensation case. These memorandums have clarified when an MSA originating from a Workers Comp case should be submitted to CMS and the procedure for this submission. Many hoped that this proposed rulemaking would be a first step in achieving similar clarity for liability cases. It is unclear why CMS withdrew this rulemaking but there is speculation in the industry that it will eventually resurface with modifications.

If you have questions about whether an MSA should be set up for a liability claim or how to administer a liability MSA, please call us at 860-259-1575.