Medicare and workers' compensation: Crucial insights to be aware of
Working with Medicare and Workers' Compensation Made Simple
Navigating between Medicare and workers' compensation can be a tricky business. It's crucial to keep Medicare in the loop when dealing with workers' comp arrangements to avoid troubles down the road.
Workers' compensation is insurance that covers on-the-job injuries and illnesses for federal employees, their families, and other eligible groups. The Office of Workers' Compensation Programs (OWCP) handles these claims under the Department of Labor.
If you're enrolled in Medicare or on the brink of it, it's essential to understand how workers' compensation might influence Medicare's coverage of work-related medical expenses. Proper knowledge can help prevent complications with healthcare costs for occupational injuries or illnesses.
How does a workers' comp settlement affect Medicare?
Under Medicare's secondary payer policy, workers' compensation takes precedence over Medicare for any treatment associated with work-related injuries. However, if immediate medical expenses arise before the workers' comp settlement, Medicare may pay first, initiating a recovery process managed by the Benefits Coordination & Recovery Center (BCRC).
To avoid a recovery process, the Centers for Medicare & Medicaid Services (CMS) often monitors the amount a person gets from workers' compensation for the medical care related to their work injury or illness. In some cases, CMS might even ask for the establishment of a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare won't cover the care till the WCMSA funds have been entirely used up.
What settlements need to be reported to Medicare?
Workers' compensation needs to submit a Total Payment Obligation to the Claimant (TPOC) to CMS to ensure Medicare covers the appropriate portion of an individual's medical expenses. Reporting a TPOC is mandated if a person is already enrolled in Medicare based on their age or Social Security Disability Insurance, and the settlement is $25,000 or more. TPOCs are also essential if the person is not enrolled in Medicare yet but will qualify within 30 months of the settlement date, with the settlement amount being $250,000 or more.
Moreover, if you file a liability or no-fault insurance claim, you're required to report to Medicare as well.
Questions and Answers
You can reach Medicare with any queries by phone at 800-MEDICARE (800-633-4227, TTY 877-486-2048). During certain hours, a live chat is also available on Medicare.gov. If you have questions about the Medicare recovery process, contact the BCRC at 855-798-2627 (TTY 855-797-2627).
A Medicare set-aside is voluntary, but if you wish to set one up, your workers' compensation settlement must exceed $25,000 or $250,000 within 30 months if you're eligible for Medicare.
Yes, it's prohibited to use the money in a Medicare set-aside arrangement (WCMSA) for any purpose other than the one it’s designated for. Misusing the funds can lead to claim denials and a requirement to reimburse Medicare.
"Learn More: What You Need to Know About Medicare Set-Aside
The Bottom Line
Workers' compensation provides insurance for job-related injuries and illnesses for federal employees and other groups.
It's essential for those enrolled in Medicare or soon to be eligible to familiarize themselves with how workers' compensation might affect Medicare coverage to avoid medical expense issues.
Reporting workers' compensation agreements to Medicare is vital to prevent future claim rejections, potential reimbursement obligations, and the preservation of Medicare benefits.
Medicare Resources
For more resources to help you navigate the complex world of medical insurance, visit our Medicare hub.
- Workers' compensation settlements may affect Medicare, as Medicare's secondary payer policy places it below workers' compensation for work-related medical expenses.
- If a workers' compensation settlement exceeds $25,000, a Total Payment Obligation to the Claimant (TPOC) must be submitted to Medicare to avoid future claim rejections and preservation of Medicare benefits.
- For those with questions about workers' compensation and Medicare, it's possible to contact Medicare by phone or live chat on Medicare.gov.
- A Medicare set-aside arrangement (WCMSA) is a voluntary method to manage funds for future medical expenses related to work injuries or illnesses, and its misuse may lead to claim denials and a requirement for reimbursement to Medicare.
