As of 4/4/25, Must Report WCMSAs as Part of Settlement

Rafael Gonzalez, Esq.

On November 13, 2023, the Centers for Medicare and Medicaid Services (CMS) held a webinar during which several of its Medicare Secondary Payer (MSP) leaders discussed the expansion of Mandatory Insurer Reporting (MIR) Non-Group Health Plan (NGHP) Total Payment Obligation to Claimant (TPOC) reporting to include Workers Compensation Medicare Set Aside Allocation (WCMSA) information. On February 23, 2024, CMS published its Technical Alert providing greater detail on this latest expansion of reporting WCMSA information on workers compensation settlements as part of TPOC.

The Technical Alert provides greater detail, including new fields to claim input file layout and claim response file error codes. Making reporting of such information a requirement will force employers, carriers, third party administrators, and their agents, to provide details of what they are doing to take Medicare’s future interests into consideration when settling workers compensation claims, even in claims in which a WCMSA was not submitted to CMS for review and approval, and in cases in which the WCMSA did not meet CMS review thresholds.

Significant to RREs will be the specific details they must report regarding the WCMSA itself. The more details CMS requires, the more they may learn about parties who may shifting responsibility of future medical needs related to the work accident to Medicare, or entities which are underfunding WCMSAs, also shifting future responsibility of occupational injuries to taxpayers. This expansion of TPOC reporting, along with CMS’ recent publishing of final rules on civil money penalties for non-compliance of mandatory reporting, ushers in what is clearly a more aggressive compliance mindset at CMS, a new era of MSP requirements and mandates in work comp claims.

Before diving into the latest changes, field numbers, and responses expected from CMS to this new mandatory reporting of WCMSA information, it is important to understand the requirements of reporting TPOC date, amount, on a timely basis.

Reporting TPOC Date

Reporting a TPOC through Medicare’s mandatory insurer reporting process is not new. As a matter of fact, it has been around since 2010. So, employers, carriers, third party administrators, and reporting agents in workers compensation claims have gotten accustomed to reporting TPOC Date on a regular basis on field 80 of the Claim Input File, TPOC Amount on field 81, and Funding Delayed Beyond TPOC Start Date on field 82.

When it comes to reporting a TPOC Date, Responsible Reporting Entities (RREs) are required to report TPOCs with dates of October 1, 2010, and subsequent. RREs may, but are not required to, report TPOCs with dates prior to October 1, 2010. This reporting requirement applies to the date payment obligation was established, not necessarily when the actual payment was made, or the check was cut. TPOC Date is the date the obligation is signed if there is a written agreement unless court approval is required. If court approval is required, the TPOC Date is the later of the date the obligation is signed or the date of court approval. If there is no written agreement, TPOC Date is the date the payment (or first payment if there will be multiple payments) is issued.

Reporting TPOC Amount

When it comes to reporting TPOC Amount, as of January 1, 2024, CMS maintained the $750 threshold for workers compensation settlements, where the workers compensation entity does not otherwise have ongoing responsibility for medicals. This threshold does not apply to non-trauma liability reporting for alleged ingestion, implantation, or exposure cases. Any settlement, regardless of amount, should be reported for these types of cases.

RREs are required to report workers compensation TPOCs only if the cumulative TPOC Amount exceeds the $750 reporting threshold for the most recent TPOC Date. RREs may submit TPOCs that are less than or equal to the $750 TPOC dollar threshold. RREs which do so will not be penalized for doing so.

The TPOC Amount refers to the dollar amount of a settlement, judgment, award, or other payment in addition to or apart from other benefits paid throughout the course of the workers compensation claim. TPOC Amount is the dollar amount of the total payment obligation to, or on behalf of the injured party in connection with the settlement, judgment, award, or other payment. TPOC Amount includes, but is not limited to, all Medicare covered and non-covered medical expenses related to the claim(s), indemnity (lost wages, property damages, etc.), attorney fees, set-aside amount (if applicable), payout totals for all annuities rather than cost or present values, settlement advances, lien payments (including repayment of Medicare conditional payments), and amounts forgiven by the carrier/insurer.

Reporting TPOC Timely

In workers compensation claims, TPOC settlements, judgments, awards, or other payments are reportable once the following criteria are met:

• The alleged injured/harmed individual to or on whose behalf payment will be made has been identified.
• The TPOC amount (the amount of the settlement, judgement, award, or other payment) for that individual has been determined.
• The RRE knows when the TPOC will be funded or disbursed to the individual or their representative(s).

Therefore, RREs should not report TPOC until the RRE establishes when the TPOC will be funded or disbursed. In some situations, funding or disbursement of the TPOC may not occur until well after the TPOC Date. RREs may submit the date the TPOC will be funded or disbursed in the “Funding Delayed Beyond TPOC Start Date” field 82 when they report the TPOC Date and TPOC Amount, but must do so if the TPOC Date and the funding of the TPOC are 30 days or more apart. Consequently, timeliness of reporting for a particular Medicare beneficiary will be based upon the latter of the TPOC Date and the Funding Delayed Beyond TPOC Start Date.

Conclusion

On February 23, 2024, CMS published its latest Technical Alert on Mandatory Insurer Reporting Section 111 of the Medicare, Medicaid, and SCHIP Extension Act (MMSEA) changes to workers compensation reporting of WCMSAs.

The alert serves as notification to workers compensation payers of the expansion of the TPOC reporting process to include WCMSAs effective April 4, 2025. This change will be prospective for TPOCs on or after the implementation date. So, only records submitted with a TPOC date on or after April 4, 2025, will be subject to these new requirements.

About Rafael Gonzalez

Rafael earned his Bachelor of Science degree from the University of Florida, and his Jurisprudence Doctorate degree from the Florida State University. He has 40 years’ experience in the legal and insurance industries. He is currently a partner in Cattie & Gonzalez, PLLC, a national law firm serving clients in all 50 states and US territories, focused on Medicare and Medicaid secondary payer law and compliance in liability, no-fault, and workers compensation claims and litigated cases. Rafael is active on social media, with over 100,000 followers on Facebook, Instagram, LinkedIn, Twitter, and Youtube. For more information, you may visit him at www.cattielaw.com, reach him at [email protected], or at 844.546.3500.