UPDATE ON MEDICARE’S REPORTING REQUIREMENTS
SC Self-Insurers Association, Inc.
General Membership Meeting
November 4, 2010
Daniel W. Hayes, Esquire
Updates since April 21-23, 2010 Members Only Forum:
Various Alerts issued by CMS
www.cms.gov/MandatoryInsRep/
U.S. v. Stricker decision (filed September 30, 2010)
Mediation 09.14.2010
Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007
Section 111 of the MMSEA
What is the SCHIP? “ State Children’s Health Insurance Program”
Purpose?
Safeguard against shifting burden for ongoing medical care from primary payer to Medicare
Section 111 is in addition to other MSP provisions (MSA allocation, etc.)
We’re interested in how it impacts Non-Group Health Plans
(NGHPs)
What is reportable? Settlements, judgments, and awards to Medicare
recipients:
Because Medicare recipient, likelihood of: conditional (past) medical payments and Obligation for future medical payments (must
consider MSA allocation, but reviewable by CMS only if amount of settlement > $25,000)
Applies if TPOC (Total Payment Obligation to Claimant) exists on or after 10/01/10
In general, TPOC = date settlement is signed, award/judgment filed
Also applies if ORM (Ongoing Responsibility for Medicals) exists on or after 01/01/10
What about mass torts, class actions settlements? (See U.S. v. Stricker)
Refresher:
CMS Memo: March 29, 2010
“Revised Implementation Timeline”
Two categories:
(1) Group Health Plan (GHP)
(2) Non-GHP, or NGHP
Liability Insurance (including Self-Insurance), No-Fault Insurance, and Workers’ Compensation
CMS Memo: March 29, 2010 (cont’d)
“Revised Implementation Timeline”
“Claim Input File” testing 01/01/10 – 12/31/10
System will go “live” 01/01/11
All initial claims must be submitted 01/01/11 to 03/31/11 according to assigned timeframes for RRE’s (Responsible Reporting Entities)
CMS Memo: April 6, 2010
Collection of HICNs, SSNs, and EINs
HICN: Medicare Health Insurance Claim Number
SSN: Social Security Number
EIN: Tax Identification Number (actually Employer Identification Number)
Collection of this information is proper for purposes of compliance with reporting requirements under Section 111
Mediation 09.14.2010
New MMSEA 111 Alerts since the Members Only
Forum
May 27, 2010
June 14, 2010
MMSEA 111 Alert: 05/27/10
Alert for RRE’s of Liability Insurance (Including Self-Insurance), No-Fault Insurance, and Workers’ Compensation
RRE does not report regularly scheduled periodic payments, pursuant to statute, for obligation other than medical expenses
(Ex) weekly TTD; weekly payment of permanency award
But must separately report ORM (Ongoing Responsibility for Medicals)
Periodic “indemnity only” payments raises inference of ORM
Periodic payments not reported as TPOC (Total Payment Obligation to Claimant)
MMSEA 111 Alert: 06/14/10
RRE ID Accountability and Other Registration Material
What to do if RRD creates ID’s unintentionally
Each RRE ID requires full compliance
Use of agent by RRE Changing information for
RRE with COBC (Coordination of Benefits Contractor)
Mediation 09.14.2010
New NGHP (Non-Group Health Plan) Alerts since
Members Only Forum
May 25, 2010
May 26, 2010 (x 3)
September 16, 2010
NGHP Alert: 05/25/10 New Direct Data Entry (DDE)
Option for NGHP Available for “Small Reporters”
RRE who expects to have only an occasional claim report to make
May only submit 500 or less claim reports per calendar year
If injured party’s information does not match a Medicare beneficiary, counts toward the 500 claims limit (essentially like a “51” disposition code)
DDE reporting may begin 01/03/11
No testing will be required
NGHP Alert: 05/26/10 (#1)
Revision to 02/24/10 Alert Includes that entities with
insurance plan with deductible are no longer required to report
Reported by entities’ insurer
Self-insured entities must continue to report
Whether TPA is considered RRE
Generally, NO But see, state’s
Assigned Claims Fund
Different under GHP arrangements, where TPA is the RRE
NGHP Alert: 05/26/10 (#2)
Risk Management Write-Offs for NGHPs
“reduction in the amount due as a risk management tool” constitutes liability self-insurance for purposes of Medicare Secondary Payer provisions
Intended by risk management to lessen probability of liability claim against it or facilitate/enhance good will
Provider reduces or W/O portion of charge to Medicare
Provide property of value to Medicare beneficiary where reasonable to expect will seek medical care
NGHP Alert: 05/26/10 (#3)
Clinical Trials & NGHPs If payments are made by
sponsors of clinical trials for complications or injuries arising out of the trials, considered payment by liability insurance (including self-insurance)
Must be reported
NGHP Alert: 09/16/10 Further definition of “Small
Reporter” for purpose of Direct Data Entry (DDE)
Registration overview for DDEs Further considerations for DDEs
United States of America v. James J. Stricker, et al.
“Memorandum Opinion Granting Certain Defendants’ Motions to Dismiss”
Filed with U.S. District Court N.D. of Alabama, 09/30/10
FN 1: “Not all defendants filed motions to dismiss. The court does not presume to know why . . . .”
“Accordingly, the decision set forth in this Memorandum Opinion and accompanying Order does not apply to those Defendants.”
U.S. v. Stricker
BACKGROUND 2003 underlying class action
tort settlement Monsanto Company and its
predecessors produced PCB’s (Polychlorinated biphenyls) at a chemical manufacturing plant one mile west of downtown Anniston, AL
The EPA determined PCB exposure could cause health dangers including cancer, decreased fertility, still births, and birth defects
1000’s of toxic-tort actions filed in Alabama against Monsanto and predecessor companies
U.S. v. Stricker All cases were consolidated in
both Alabama state and federal courts
Global settlement reached on 08/20/03
$300 million Involved combined total of
more than 20,500 people $275K placed in Court trust;
remainder to be paid in annual installments through 2013
Conditions to release: Funds released into
attorney-maintained trust once 75% of adult plaintiffs signed releases
Could be disbursed to plaintiffs once court approved all minor settlements and 97% of releases signed
U.S. v. Stricker Department of Justice filed suit
12/01/09 against plaintiff attorneys and defendant corporations/insurance carriers under Medicare Secondary Payer statute
Alleged 907 unnamed recipients also received Medicare payments for unidentified medical expenses related to PCB contamination
(Some) defendants filed Motion to Dismiss based upon statute of limitations
U.S. v. Stricker Issues for Court:
(1) What SOL applies to each class of defendants (corporate defendants, plaintiff attorneys)?
(2) When did the government’s cause of action accrue for each class of defendants?
U.S. v. Stricker MSPA does not include a SOL
Parties agreed SOL under the “Federal Claims Collection Act” would apply
3 years if founded upon tort;
6 years if founded upon contract
U.S. v. Stricker
Corporate Defendants:
No express contract between government and corporate defendants
Any reimbursement duties based solely on MSP statute
Liability, if any, arises out of defendants’ liability in tort settlement
“But for” the tort liability, no liability for reimbursement
So, 3 year statute of limitations applies under tort
U.S. v. Stricker
When did government’s cause of action accrue against corporate defendants?
Court focused on determining at what point did defendants’ responsibility to pay arise in relation to the underlying class-action settlement
For corporate defendants, accrued on date settlement agreement executed and approved by Court on 08/20/03
So even if 6 year SOL applied, government lawsuit filed 12/01/09 would have been barred
U.S. v. Stricker
Plaintiff Attorneys:
Conceded 6-year statute of limitations based upon contractual nature of attorney fees received from their clients
So, issue is when did government’s cause of action accrue against plaintiff attorneys?
U.S. v. Stricker
Government argued no responsibility to pay arose until 12/02/03, when all minor settlements were approved by court, 97% of plaintiffs had signed releases, and funds could be disbursed
DOJ lawsuit filed 12/01/09---one day prior to 6 years later
Settlement was “conditional”
The Court did not agree 97% certification was
“condition subsequent” to contract
Did not affect overall enforceability of settlement agreement
U.S. v. Stricker
Government’s right to intervene against plaintiff’s attorneys accrued no later than 10/29/03, when funds transferred from Court into attorneys’ escrow account
Lawsuit filed against plaintiff attorneys on 12/01/09 barred by 6-year SOL
Why is U.S. v. Stricker important?
Provides framework for calculating government’s statute of limitations for filing lawsuits to collect reimbursement
When applied in context of mandatory reporting requirements, may be able to calculate either 3-year or 6-year SOL’s based upon date of Total Payment Obligation of Claimant (TPOC), or when settlement agreement is signed (or award/judgment filed)
Likely 3-year SOL applicable to corporate defendants/carriers
Likely 6-year SOL applicable to plaintiff attorneys
Shows the government can be defeated on MSP lawsuits (but not over yet . . . )
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