Proposed Rulemaking on LMSAs issued by Office of Management and Budget
Heather Sanderson
December 6, 2018

A proposed rulemaking on “Miscellaneous Medicare Secondary Payer Clarifications and Updates” has been posted on the Office of Management and Budget website. The proposed rulemaking can be found here.

The abstract of the rule states:  “This proposed rule would ensure that beneficiaries are making the best health care choices possible by providing them and their representatives with the opportunity to select an option for meeting future medical obligations that fits their individual circumstances, while also protecting the Medicare Trust Fund. Currently, Medicare does not provide its beneficiaries with guidance to help them make choices regarding their future medical care expenses when they receive automobile and liability insurance (including self-insurance), no fault insurance, and workers’ compensation settlements, judgments, awards, or payments, and need to satisfy their Medicare Secondary Payer (MSP) obligations.”

Franco Signor Commentary:

Noteworthy within the proposed rule is that this is the first time this proposed rule has been published in the Unified Agenda, and it provides that a Notice of Proposed Rulemaking (NPRM) will be issued by September 2019. Additionally, the proposed rule states that with regard to priority level, this initiative will be “Economically Significant” to the Department of Health and Human Services (HHS).

This notice does not come as a surprise as the Centers for Medicare & Medicaid Services (CMS) has been recently indicating over the past several years that it will move forward with a voluntary Liability Medicare Set-Aside (LMSA) and No-Fault Medicare Set-Aside (NFMSA) review program. Additionally, the current Workers’ Compensation Review Contractor (WCRC)’s Request for Proposal (RFP), which was awarded to Capitol Bridge LLC, had also indicated that the contractor for the first time ever would also have the task of reviewing LMSAs and NFMSAs in addition to WCMSAs. As such, the current WCRC is contractually bound to take on this task once CMS issues parameters around LMSA and NFMSA review. What appears to be a mistake in the abstract of the proposed rule is the inclusion of workers’ compensation with the statement that currently Medicare does not have a process for choices regarding future medical. As all are aware, a process does exist for review of WCMSAs. In the alternative, perhaps workers’ compensation was included purposefully and changes to the WCMSA review process may be forthcoming when an LMSA/NFMSA review process is released. We anticipate that we will have additional clarity around this in the near future.

We will continue to monitor this proposed rulemaking and provide updates as they come available.