Navigating the Intersection of Workers' Compensation and Medicare: Essential Information
Navigating the intersection of workers' compensation and Medicare is vital. Neglecting to inform Medicare about workers' compensation arrangements can lead to claim denials and financial obligations to reimburse Medicare.
Workers' compensation serves as insurance for employees who sustain job-related injuries or illnesses. Supervised by the Office of Workers' Compensation Programs (OWCP) under the Department of Labor, this benefit caters to federal employees, their families, and select other entities.
Those currently on Medicare or soon to qualify for it should comprehend how their workers' compensation benefits could potentially impact Medicare's coverage of their medical claims. This understanding is crucial to avoid complications with medical costs related to work-related injuries or illnesses.
The Impact of a Workers' Comp Settlement on Medicare
Under Medicare's secondary payer policy, workers' compensation must fund any treatment for work-related injuries prior to Medicare. If immediate medical costs arise before a person receives their workers' compensation settlement, Medicare may offer initial financial support, initiating a recovery process managed by the Benefits Coordination & Recovery Center (BCRC). To dodge this recovery process and prevent complications with medical costs, the Centers for Medicare & Medicaid Services (CMS) typically monitors the amount a person receives from workers' compensation for injury or illness-related medical expenses.
In some scenarios, Medicare may request the establishment of a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover medical expenses after the entire amount in the WCMSA has been depleted.
Settlements Requiring Report to Medicare
Workers' compensation payers must submit a Total Payment Obligation to the Claimant (TPOC) to CMS to ensure Medicare covers the appropriate portion of a person's medical expenses. This total represents the amount owed to the person from workers' compensation.
Submitting a TPOC is crucial if a person is already on Medicare due to age or receiving Social Security Disability Insurance, and the settlement is $25,000 or more. TPOCs are also necessary if the person is not yet enrolled in Medicare but will qualify in the following 30 months and the settlement amount is $250,000 or more.
In addition to workers' comp, a person must also report to Medicare if they file a liability or no-fault insurance claim.
Frequently Asked Questions
A person can contact Medicare with questions by phone at 800-MEDICARE (800-633-4227, TTY 877-486-2048). During certain hours, a live chat is available on Medicare.gov. If a person has questions about the Medicare recovery process, they can contact the BCRC at 855-798-2627 (TTY 855-797-2627).
A Medicare set-aside is optional. However, if a Medicare beneficiary wishes to establish one, their workers' compensation settlement must be over $25,000. Alternatively, it must be over $250,000 if the beneficiary is eligible for Medicare within 30 months.
Yes. Misusing the funds in a Medicare set-aside arrangement, such as a WCMSA, for purposes other than the designated one can lead to claim denials and the need to reimburse Medicare.
For further insights into Medicare set-asides,visit our Medicare hub.
- Workers' compensation systems play an essential role in offering financial protection to employees who suffer job-related health issues, which are overseen by the Office of Workers' Compensation Programs (OWCP) under the Department of Labor.
- Medicare's secondary payer policy mandates that workers' compensation should cover any treatments related to work-injuries before Medicare, and in certain cases, Medicare may request the creation of a Workers' Compensation Medicare Set-Aside Arrangement (WCMSA) to manage funds dedicated to injury-related medical expenses.
- If a person receiving workers' compensation benefit is currently on Medicare or will qualify for it shortly, reporting the Total Payment Obligation to the Claimant (TPOC) to the Centers for Medicare & Medicaid Services (CMS) is crucial, especially if the settlement is over $25,000 or $250,000 (within 30 months of Medicare eligibility).
- The completion of a Medicare set-aside (e.g., WCMSA) is not compulsory; however, misusing the funds for purposes other than the designated one could result in claim denials and financial obligations to reimburse Medicare.
