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New Medicare Threshold
On April 25, 2006, CMS released a new memorandum announcing that it has
raised its threshold for review of workers' compensation settlements for Medicare
beneficiaries from $10,000 to $25,000. This memo changes the dollar amount of
the threshold create by its memo of July 1, 2005. Thus, as of April 25, 2006,
CMS will no longer review workers' compensation settlement proposals where the
total settlement is less than $25,000. It is important to note that CMS considers
its thresholds as "workload
review" thresholds
and not "safe harbor" thresholds. Presumably, this means that despite the
fact that it refuses to review such settlements, it does not waive any of
its rights under the Medicare Secondary Payer statute. See
CMS memo of April 25, 2006 Memo.
Prescription Medications
On December 30, 2005, CMS released a formal policy memorandum regarding
prescription drugs and the Medicare Secondary Payer Statute. It now
requires that all workers' compensation settlements that occur on
or after January 1, 2006, must consider and protect Medicare’s
interests when future treatment includes prescription drugs along
with the future medical services that would otherwise be reimbursable
by Medicare.
For set-aside proposals received by
CMS on or after January
1, 2006, the cover
letter must include separate amounts for: (1) future medical treatment,
and (2) future
prescription drug treatment. In addition, the cover letter must include
an explanation as to
how the submitter calculated the future prescription drug treatment amount
(i.e., actual
costs, average wholesale price, etc.).
If the cover letter does not include an amount for future prescription
drug
treatment, and the current treatment records indicate that the claimant
has been prescribed
drugs and/or may need prescription drugs related to the WC injury in
the future, the
submitter did not adequately consider Medicare’s interests. In
such a case, CMS will
advise the submitter in its written opinion that the parties to the WC
settlement may not
have protected Medicare’s interests. See
the CMS memo of December 30, 2005
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