CMS continued its series of webinars on September 17th introducing the CRC to the industry and explaining how it will impact conditional payment recovery processes. Previously we blogged on the last CMS webinar, but there were additional helpful clarifications in yesterday’s webinar. To read our last blog, please click here. The information noteworthy of mention on the CRC transition follow:
- CRC will manage recovery cases where the Responsible Reporting Entity (RRE) has reported Ongoing Responsibility for Medical (ORM), ORM Termination or Total Payment Obligation to Claimant (TPOC) via Section 111 reporting and CMS has identified the primary debtor as the RRE. Conditional Payment Notices (CPNs) will be issued by the CRC starting October 25, 2015 from Section 111 data that is processed on or after October 5, 2015.
- If a case is reported manually to the BCRC, before Section 111 data is sent, the BCRC will handle the recovery. However, the BCRC will always handle the recovery where the primary identified debtor is the Medicare beneficiary. This would be typical for liability claims.
- CMS (Barbara Wright) indicated that the recovery process will not change in any appreciable way for liability insurance carriers/plans; as the Medicare beneficiary is typically the primary debtor for those claims. The major change is for no-fault and workers’ compensation claims, which will more than likely be handled by the CRC because the primary debtor is the RRE/Primary Plan.
- The CRC will issue Conditional Payment Notices (CPNs) based on the Section 111 data. A settlement, judgment, or award is no longer the applicable trigger. ORM without a TPOC or ORM Termination Date will result in a CPN, and if such notice is not acted upon a Demand for Payment will issue 30 days from CPN Notice date. CMS (Barbara Wright) refused to comment on the volume of letters a RRE may expect, but CMS did indicate that the RRE should expect multiple CPN letters and multiple Demand letters over the life of a claim.
- BCRC will continue to issue a Conditional Payment Letter (CPL), unless they are made aware of a settlement, award or judgment before a CPL has issued, in that case a Demand would issue. A CPL has no timeline for a response. The CPL and CPN will differ on one key point, only the CPN will indicate a time due for response. Parties should scrutinize all correspondence carefully.
- Interest accrues from the first day of a Demand letter; but will not be assessed if the debt is paid within 60 days. (Please note that this is a correction from our prior blog as CMS clarified this point on yesterday’s webinar).
- Inquiry was made on the webinar of what legal authority CMS has to recover conditional payments on cases where there has not been a full and final settlement, judgment or award. CMS (Barbara Wright) pointed to the text of the MSP statute, where it indicates that once responsibility is demonstrated, Medicare recovers for conditional payments. She indicated that responsibility is demonstrated where a Responsible Reporting Entity (RRE) reports ORM.
- All nongroup health plan (NGHP) recoveries, whether being handled by the BCRC or the CRC, can be accessed online through the same portal, the Medicare Secondary Payer Recovery Portal (MSPRP) that most of us use today. The CRC portal that exists today is only for Group Health Plan (GHP) recoveries.
Franco Signor Commentary: Primary Plans, Applicable plans and Responsible Reporting Entities should brace for the impact of this transition. ORM only cases are now subject to CMS recovery claims for reimbursement. When a CPN is received, swift action is required to dispute it, otherwise a debt will be automatically established with the United States Government in the form of a Demand Letter. Particularly, workers’ compensation and no-fault payers need to prepare. Contact us to help you prepare, as the exposure goes beyond “open” claims inventory. Any workers’ compensation or no-fault claim that does not have a valid ORM Termination Date, is subject to a potential CPN. Also, any administratively closed WC or no-fault claim after January 1, 2010 that has not been subject to ongoing query for Medicare is also potentially exposed to CPNs. Your reporting agent must properly conduct Medicare queries to avoid significant contingent liabilities. Medicare query does not end when a file is administratively closed and the CRC will no doubt at some point compare data of RREs for anomalies. Contact us to audit your reporting agent.
A critical distinction between conditional payments recoveries by the BCRC or the CRC cover Medicare Part A and B. CMS explained during the webinar that RREs/applicable plans should address and resolve Part C and Part D plans as well. Roughly 30% of the Medicare population is currently enrolled in a Medicare Advantage plan (Part C or Part D), and that percentage continues to grow annually. It is critical to determine whether claimants are also enrolled in a Medicare Advantage Plan prior to settlement.
As we understand it, Medicare Advantage Plans have recently had success recovering double damages using the MSP private cause of action for unreimbursed conditional payments in recent case law. Therefore, being proactive about checking these plans and reimbursing these payments is a best practice. RREs/Applicable Plans need to inquire about which plans a beneficiary is or was enrolled in prior to settling a case through formal discovery issued to the beneficiary, in the hopes of absolving any future Medicare Advantage Plan recovery demands.
Please contact us with any questions on the new conditional payment recovery processes and transition of recovery workload to the CRC.
Heather Schwartz Sanderson, Esq., MSCC, CHPE, CLMP, CMSP
Chief Legal Officer