New law requires CMS to provide information on Medicare plan type(s) to workers’ comp, no-fault and liability insurers

The recently enacted Provide Accurate Information Directly (PAID) Act will make it easier to determine whether payments for claimed injuries/illness involving workers’ compensation, no-fault and/or liability claims were made by traditional Medicare and/or a Medicare Advantage (Part C) plan (MAP) and/or a prescription Part D plan (PDP) and whether they need to be reimbursed.

PAID Act eases finding claims that could threaten non-group health plan insurers

Medicare beneficiaries’ participation in MAPs and PDPs continues to grow. To date, among Medicare beneficiaries, over a third are members of a MAP and more than 70% are enrolled in a prescription PDP. Therefore, the probability increases that a MAP or PDP plan may have paid for treatment using the MAP or PDP card.

Up until now, there was no central database to search whether a claimant was enrolled in a MAP or PDP since the Medicare Secondary Payer Recovery Portal (MSPRP) only contains conditional payments paid by traditional Medicare.

The PAID Act will make it easier to identify claims that pose a risk to non-group health plan (NGHP) insurers. Claims may be brought against NGHPs by Medicare Advantage plans for “double damages” under Medicare's private cause of action (PCOA) provision, 42 USC §1395y(b)(3).

The PAID Act, signed into law December 11, 2020 by President Trump, is a big step forward in sharing MAP and PDP information with insurers via the Section 111 Medicare query process, which allows insurers and payers to better coordinate medical coverage and identify potential recovery risks. 

Impact of the PAID Act on Section 111 Medicare Query Process

The PAID Act will require the Centers for Medicare and Medicaid Services (CMS) to update its Section 111 Medicare Query (MQ) Process to confirm the name and address of a claimant who is currently or has been, during the preceding three-year period, enrolled in a MAP or PDP.  Currently, the Query response only confirms that a claimant is enrolled in Medicare. It does not provide any information as to the “type” of Medicare program in which the claimant/beneficiary is enrolled.

Next Steps for insurers and Responsible Reporting Entities (RRE)

Although the PAID Act gives CMS a year to implement the IT specifications for Section 111 Reporting Agents, Optum recommends that you:

• Shore up your MAP and PDP conditional payment verifications process prior to settlement.
• Reach out to the Optum MAP and PDP Conditional Payment Team to verify whether a MAP or PDP may have made payments that need to be reimbursed. Optum has contacts with over half of the MAP and PDP recovery contractors and can determine statuses before their names and addresses will be returned in the query response file via Section 111 process and before the PAID Act is implemented.
• Reach out to Optum to analyze the MAP and PDP payment itemization. If the MAP and PDP analysis shows some items, services, and RXs are unrelated to the underlying claim, refer to Optum to dispute and reconcile what may be owed before recovery rights are asserted for reimbursement.
• Once MAP and PDP names and addresses are returned on the Query Response File, the Section 111 Reporting Submitter will provide them to their RRE/insurers so that the settling parties may respond and verify payments, if any, and reimburse if related to avoid potential private causes of action under the MSP Act.

Optum and its proprietary Section 111 submission platform, MedicareConnect^®, will monitor the PAID Act implementation roll out and keep you informed whether CMS will seek public comment and/or  offer informational webinars before issuing written directives for its many responsible reporting entities (RRE), insurers and third party claims administrators.

When Optum Settlement Solutions receives technical guidance from CMS as to how this change will be incorporated into the current Medicare beneficiary query process, we will update our Section 111 reporting clients.

For questions about MAP and PDP conditional payment recovery and Section 111 query and reporting, please contact Lorenzo Garza, who oversees operations, at lorenzo.garza@optum.com.