Franco Signor LLC – November 15, 2010
Centers for Medicare and Medicaid Services (CMS) issued new liability reporting rules in an alert on November 9, 2010. Click here for the Alert. Responsible Reporting Entities (RRE) may now voluntarily report liability settlements, awards and judgments, without penalty, beginning next year. Mandatory liability reporting is now slated to start January 1, 2012, and apply only to cases resolved on or after October 1, 2011. CMS welcomes and encourages early reporting of cases as it will provide the RRE with opportunity to refine its production reporting.
Franco Signor LLC applauds CMS in providing RRE’s with penalty relief and opportunity to work out liability reporting interface issues with the Coordination of Benefit Contractor (COBC). CMS extension of reporting thresholds are also appreciated. When mandatory reporting of liability settlements, awards and judgments commences the thresholds will be:
• Prior to January 1, 2013, $5,000 or greater;
• Between January 1, 2013 through December 31, 2013, $2,000 or greater;
• Between January 1, 2014 through December 31, 2014, $600 or greater; and
• No threshold on or after January 1, 2015.
Penalty relief applies only for liability cases involving settlements, awards and judgments. CMS refers to this as Total Payment Obligation to Claimant (TPOC) cases. It does not apply to liability cases where there is an Ongoing Responsibility for Medical (ORM) component. ORM such as Medical Payments and No-Fault coverage must still be reported on January 1, 2011.
Franco Signor LLC continues to recommend voluntary reporting of liability cases to the COBC. The electronic reporting requirements (Section 111 of the MMSEA SCHIP Extension Act of 2007) does not amend, alter or otherwise change responsibilities under the Medicare Secondary Payer Act (42 U.S.C. §1395y(b)). Under existing regulations, Medicare must be notified. See 42 CFR § 411.25, below:
§ 411.25 Primary payer’s notice of primary payment responsibility.
(a) If it is demonstrated to a primary payer that CMS has made a Medicare primary payment for services for which the primary payer has made or should have made primary payment, it must provide notice about primary payment responsibility and information about the underlying MSP situation to the entity or entities designated by CMS to receive and process that information.
COBC has processes in place today to self-identify liability cases. Parties to the liability case may be inconvenienced where Medicare’s conditional payments are not properly concluded within a reasonable period of the settlement, award and judgment. Franco Signor LLC continues to believe a proactive approach to Medicare issues is appropriate.