By: Jarvis B. Läkemäker, Esq.
In December we discussed when you should have an MSA done and when you would need the Centers for Medicare & Medicaid Services (CMS) approval. We provided a Medicare Checklist to assist you in that evaluation.
This month, we will focus on the steps CMS’ Workers’ Compensation Review Contractor (WCRC), Capitol Bridge, LLC, takes when engaging in the medical review process. This information will assist you in identifying areas where the MSA is being scrutinized to minimize the chance of a counter higher determination.
1. Validate demographics and contact information. Here the WCRC will verify the claimant’s name, SSN, Medicare ID, address, and date of birth. They will check that contact information is correct for attorneys, carriers, and relevant administrators, and confirm that there is a signed consent-to-release note.
2. Verify that the total settlement amount (TSA) is clear and that the review threshold is met.
Cases that fall clearly under the threshold will be closed as ineligible. The claimant must be on medical with a total settlement of at least $25,000, or have applied for SSDI with a total settlement of at least $250,000.
3. Verify that dates of injury and conditions being settled are clear. Since multiple dates of injury can be included in a single CMSA, it is critical to identify which alleged and accepted body parts correspond with which date of injury, and to provide medical records, payment history, and a detailed prescription history for each DOI being settled. Further, resolution must be consistent. WCRC will not work a case where the MSA attempts to settle medical claims for a body part, but leaves unresolved prescriptions for the same body part.
4. Verify the proposed set-aside amounts. The WCRC will ensure the settlement documents, cover letter, and proposed future treatment tables are consistent. Variations or incomplete information will require the WCRC to develop the case, resulting in delayed review.
5. Verify jurisdiction and calculation method. Fee schedule selection and pricing is contingent on where the WC claim is filed, state of residence of the claimant, employer location, whether claimant is represented by counsel, and carrier location. Ensuring this information is correct will preclude the possibility of a higher price fee schedule being applied.
6. Verify payout method: lump sum versus annuity. If not specified in the settlement documents, claimant attorney’s request, or submission cover letter, the WCRC will default to a lump sum payout.
7. Calculate life expectancy using standard age or median rated age. It’s important to evaluate if you want the MSA to include optional rated ages when calculating the claimant’s life expectancy. For example, a claimant that has been involved in a catastrophic accident may have a rated age of 40 when their calendar age could be 25. This rated age is then considered when determining the value of an annuity settlement. Ensuring the rated age is considered can result in significant savings.
8. Verify that treatment records, payment records, and pharmacy records are up-to-date, complete, and valid.
MSAs need to include two years of treatment records relevant to the injury. IME reports are not a valid substitute. Payment records must have been printed within six months of submission and include two years of history. Pharmacy records must identify doses and frequencies of each medication.
9. Review records and submitter’s proposed plan. Price the appropriate future medical and pharmacy services.
The WCRC will always price the case at 100% of the future costs related to the work Injury and will prepare a recommendation to CMS advising whether or not the proposal protects Medicare’s interests.
10. Provide an explanation in the decision rationale for counter higher or counter lower determinations.
If the MSA amount is within 5% of the combined total medical and prescription costs, the WCRC will recommend approval. In structured cases the proposed seed amount must also be within 5% of the amount calculated by the WCRC. If so, it will be approved. Failure to be within the 5% upper or lower range will result in a counter determination.