Understanding Workers' Compensation Interactions with Medicare: Essential Facts
Navigating Medicare when dealing with workers' compensation arrangements is crucial to avoid claim denials and reimbursement obligations.
Workers' compensation offers insurance coverage to employees who sustain work-related injuries or illnesses, overseen by the Office of Workers' Compensation Programs under the Department of Labor. This coverage extends to federal employees, their families, and certain other entities.
Understanding the impact of workers' compensation benefits on Medicare's coverage for work-related medical claims is essential to avoid complications with medical costs. Here's how it works:
Settlement Impact on Medicare
Medicare deems workers' compensation as the primary payer for any work-related injury treatment. However, if immediate expenses arise before receiving the workers' compensation settlement, Medicare might foot the bill initially and initiate a recovery process managed by the Benefits Coordination & Recovery Center (BCRC).
To avoid a recovery process, the Centers for Medicare & Medicaid Services (CMS) generally keeps tabs on the amount a person receives from workers' compensation for their injury or illness-related medical care. In some cases, Medicare may require a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds, covering care only after the WCMSA funds have been depleted.
Reportable Settlements
Workers' compensation must submit a Total Payment Obligation to the Claimant (TPOC) to CMS to ensure Medicare covers the appropriate portion of a person's medical expenses. This submission is necessary for people already on Medicare, based on age or Social Security Disability Insurance, or soon to be, with a settlement of $25,000 or more.
TPOCs are also crucial if the person isn't yet enrolled in Medicare but is expected to within 30 months of the settlement date, and the settlement amount is $250,000 or more. In addition to workers' comp, Medicare must also be informed about any liability or no-fault insurance claims filed by the person.
FAQs
- To contact Medicare, dial 1-800-MEDICARE (800-633-4227, TTY 877-486-2048). During specific hours, a live chat is available on Medicare.gov. For queries about the Medicare recovery process, contact the BCRC at 1-855-798-2627 (TTY 1-855-797-2627).
- A Medicare set-aside is optional, but it becomes necessary if the workers' compensation settlement exceeds $25,000 for a Medicare beneficiary or $250,000 if the individual is eligible for Medicare within 30 months.
- Misusing a Medicare set-aside arrangement can lead to claim denials and reimbursement obligations to Medicare.
- To learn more about Medicare set-asides, check out our guide: What to Know about Medicare Set-Asides.
Takeaway
Understanding workers' compensation and its impact on Medicare is fundamental for avoiding issues with medical expenses. Properly reporting workers' compensation agreements to Medicare is vital to prevent future claim rejections and reimbursement obligations.
Resources
For more resources to help navigate the complexities of medical insurance, visit our Medicare hub.
- Medicare considers workers' compensation as the primary payer for work-related injury treatments, but it might initially cover immediate expenses before settlement and then recover the costs later.
- To avoid a recovery process, Medicare might require a workers' compensation Medicare set-aside arrangement (WCMSA) for funds covering care only after the WCMSA funds have been depleted.
- Workers' compensation must submit a Total Payment Obligation to the Claimant (TPOC) to Medicare for people currently on Medicare, those who will be based on age or Social Security Disability Insurance, or people expected to enroll within 30 months of the settlement date, with a settlement of $25,000 or more.
- Misusing a Medicare set-aside arrangement can lead to claim denials and reimbursement obligations to Medicare, and it is essential to learn more about Medicare set-asides to navigate complexities in medical insurance.
