Medicare and Workers' Compensation: Essential Information to Understand
Federal employees or certain groups experiencing job-related injuries or illnesses are covered by workers' compensation insurance. It's crucial for those enrolled in Medicare or approaching eligibility to understand how this benefit affects their healthcare coverage, especially when it comes to medical expenses related to work injuries.
Failing to notify Medicare about such arrangements can lead to claim denials and the obligation to reimburse the federal health insurance program.
Workers' compensation is the primary payer for any medical treatment resulting from a work-related injury, according to Medicare's secondary payer policy. However, if immediate medical expenses arise before the workers' compensation settlement is received, Medicare may initially cover the costs while managing a recovery process through the Benefits Coordination & Recovery Center (BCRC).
To avoid this recovery process and potential complications, the Centers for Medicare & Medicaid Services (CMS) keeps tabs on the amount a person receives from workers' compensation for their injury or illness-related medical care. In some cases, Medicare may require a workers' compensation Medicare set-aside arrangement (WCMSA) to ensure coverage only after the WCMSA funds have been exhausted.
It's the responsibility of the primary payer, often an insurance carrier or third-party administrator, to report a workers' compensation settlement to Medicare, not the claimant. The Responsible Reporting Entity (RRE) must determine if the injured party is a Medicare beneficiary and then submit the settlement details to CMS using electronic file exchange or manual data entry via the Section 111 COB Secure Website (COBSW).
Reporting is required if the person is a Medicare beneficiary or will become one within 30 months and the settlement includes payment for medical care or releases medical claims. Failure to comply can lead to civil monetary penalties.
Medicare beneficiaries do not need to self-report settlements but must ensure that settlement funds are used appropriately if a WCMSA is created to avoid future denial of Medicare benefits for related care.
For more resources to help navigate the complex world of medical insurance, visit the Medicare hub.
- The Responsible Reporting Entity (RRE) must determine if the injured party is a Medicare beneficiary and then submit the settlement details to CMS.
- Medicare may require a workers' compensation Medicare set-aside arrangement (WCMSA) to ensure coverage only after the WCMSA funds have been exhausted.
- Medicare beneficiaries do not need to self-report settlements but must ensure that settlement funds are used appropriately if a WCMSA is created.
- It's essential for those enrolled in Medicare or approaching eligibility to understand how workers' compensation affects their healthcare coverage, as failing to notify Medicare about such arrangements can lead to claim denials and the obligation to reimburse the federal health insurance program.
