Proposed Rule on MMSEA Section 111 Reporting Civil Monetary Penalties (CMPs): What Happens Next?
Heather Sanderson
May 26, 2020

The Non-Group Health Plan (NGHP) industry (workers’ compensation, liability, and no-fault insurance) has been curious as to what to anticipate now that the Centers for Medicare & Medicaid Services (CMS) is in receipt of comments from the industry regarding the suggested parameters of the Proposed Rule. The Proposed Rule was issued on February 18, 2020, and when the rule finalizes, CMS can issue CMPs against noncompliant primary payer Responsible Reporting Entities (RREs) up to $1000 per day/per claim.

For our prior blog on the nuts and bolts of the Proposed Rule, please click here. FS Claims Solutions as well as approximately 80 other entities/individuals have now submitted comprehensive comments on the Proposed Rule in advance of the April 20, 2020 deadline. The submitted public comments can all be found here. We have received numerous questions on the Proposed Rule, and what next steps RREs should take now in advance of the Final Rule. While there are still many unknowns before the Final Rule is issued, below are some of the common questions we have received and what we have advised.

What happens next with the Proposed Rule? Now that the comment period has closed, CMS will review all comments submitted and analyze them. After reviewing and analyzing the comments, CMS can proceed with the rulemaking process and issue a new or modified proposal. Some agencies withdraw a Proposed Rule at this state, but given that CMS has previously withdrawn its Proposed Rule on this topic previously in 2014, we anticipate that CMS is serious about Responsible Reporting Entities (RREs) complying with reporting requirements, or it would not have re-issued this Notice of Proposed Rule.  Before reaching a final decision, CMS will make any appropriate revisions to the various supporting analyses prepared for the Notice of Proposed Rulemaking (NPRM).[1]

Although the Proposed Rule is anticipated to be prospective in nature, will my claims data submitted (or not submitted) prior to the Effective Date of the Final Rule be subject to CMPs if our reporting was deemed to be not fully compliant by CMS? The Proposed Rule is not entirely clear on this. While the Rule is intended to be “prospective,” meaning that compliance would be evaluated based upon files submitted on or after the effective date of any final rule, the Proposed Rule leaves ambiguous whether RREs would be subject to CMPs for settlements/TPOCs not submitted timely prior to the Final Rule enactment date. Further, the Proposed Rule does propose limiting CMS to a 5-year statute of limitations which would begin running from the date that CMS learns of the noncompliance. As such, RREs should begin taking steps now to avoid CMPs in the future by making sure TPOCs are submitted timely and cleaning up any old data as well as errors. A late report is better than no report, and CMS will likely consider good faith efforts of the RRE to provide CMS with the data.[2]

What should I do if I am unable to obtain an injured party’s Social Security Number? What steps should we take now to document our file of our good faith efforts to obtain it? The Proposed Rule sets forth a very specific process that it would like to see RREs undergo to obtain an injured party’s SSN: documentation in the claims file that the RRE has reached out at least twice by mail and at least once by phone. However, these specific step requirements may change somewhat in the Final Rule. Further, CMS has made clear in its Fact Sheet on the Proposed Rule that its objective in order to defend CMPs is generally that the RRE evidence their good faith efforts to obtain the information.  As such, until the Final Rule is published, the central guidepost that we recommend for injured parties who refuse to provide their SSN is that there be a CMS Affidavit in the file that the injured party execute prior to settlement. The CMS Affidavit has previously been recommended for RREs to document good faith efforts to obtain an injured party’s SSN by CMS and can be found here. FS also offers a proprietary SSN look-up tool to alleviate the SSN conundrum. Best practices may be updated on this issue when CMS issues a Final Rule.

As always, we remain available for guidance and to provide the most robust and compliant MMSEA Section 111 Reporting services available to RREs.  Contact us at engage@francosignor.com with questions. We will keep our subscribers updated on the Proposed Rule as it develops.


[1] https://www.regulations.gov/docs/FactSheet_Regulatory_Timeline.pdf

[2] https://www.federalregister.gov/documents/2020/02/18/2020-03069/medicare-program-medicare-secondary-payer-and-certain-civil-money-penalties