New WCMSA Reference Guide 3.3 published by CMS
The Centers for Medicare and Medicaid Services (CMS) released Version 3.3 of the Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide, which clarifies how to calculate the seed money (initial deposit) in a structured WCMSA. The language in “Section 5.2: Structured WCMSAs” specifies that the seed money is required to cover the first surgery or procedure for each body part, and/or replacement and the first two years of annual payments. Additional references to this change are also found on pages 20, 39 and 41 of the Reference Guide.
You can also click here to view our previous blog on this topic from November 5, 2020, following the NAMSAP annual conference, where this seed money update was first referenced.
In “Section10.2: Consent to Release Note”, CMS has addressed and clarified documentation needed in the consent to release signatures stating, “Consent to Release documents must be signed (by hand or electronically) with the full name of either the claimant, matching the claimant’s legal name, or by the claimant’s authorized representative, if documentation establishing the relationship is also provided. It must be a full signature, not initials.” The beneficiaries’ initials are also still required in the appropriately marked section.
Additional miscellaneous Reference Guide updates include:
- Section 9.4.5 Medical Review Guidelines, Intrathecal Pumps subsection added the clarifying language, “Pricing includes necessary pump refills over the claimant’s life expectancy,” regarding allocations for intrathecal pain pumps. This is not new information and WCMSAshave historically included pump refills over life expectancy.
- Section 16.2 Amended Review, Notes section added clarifying language regarding WCMSA Portal case access for Professional Administrators who are not the original submitter. The update refers Professional Administrators who are not the original submitter to Section 19.4, which states, “Professional Administrators whose EIN does not match the EIN of the original submitter, contact BCRC to gain access to the case via the WCMSA Portal; otherwise you must submit by mail.”
- Section 19.4 Change of Submitter was updated to clarify that CMS will not provide copies of existing documentation to the new submitter. Any documentation must be obtained from the incumbent submitter or insurer.
- The Major Medical Centers table was updated to include a new entry (Appendix 7): The Medical Center name “The University of Kansas Hospital” changed to “St. Luke’s Hospital of Kansas City”.
- The CDC Life Table link was updated (Section 10.3- Rated Age Information or Life Expectancy); https://www.cdc.gov/nchs/data/nvsr/nvsr69/nvsr69-12-508.pdf
- Workers’ Compensation Review Center (WCRC) Proposal Review Reference tools list in Appendix 4 added a disclaimer for the Conduent Strataware® tool that states, “Strataware® is a tool, for repricing medical bills to state mandated fee schedules, as well as usual, customary and recommended (UCR) rates.” https://www.conduent.com/solution/cost-containment/
Impact to the industry
The above noted additions and clarifications are relatively minor except for the WCMSA seed money update, which requires an initial deposit for the first surgery or procedure for each body part. By placing more of the total settlement amount into the upfront seed money to fund the WCMSA, less funds will remain to pay for related medical expenses allocated over life expectancy. This diminishes an employer’s cost savings when choosing a structured annuity rather than a lump sum and will cost carriers and TPAs more to settle claims. CMS informed the industry of this change last year, indicating they would clarify this requirement in an upcoming User Guide update.
Optum Settlement Solutions will continue to keep the industry updated on all aspects of Medicare Secondary Payer (MSP) compliance, including issues pertaining to WCMSAs.