Navigating Workers' Compensation and Medicare: Essential Facts to Understand
Important Notice: Understanding the Interplay Between Workers' Compensation and Medicare
Workers' compensation is a vital insurance program for employees who suffer job-related injuries or illnesses. The Office of Workers' Compensation Programs (OWCP) under the Department of Labor oversees this benefit, which applies to federal employees, their families, and certain other entities.
People enrolled in Medicare or soon to qualify for it should be aware of how their workers' compensation benefits could impact Medicare's coverage of medical claims pertaining to work-related injuries. This knowledge is essential to avoid complications with medical expenses.
Workers' Compensation Settlements and Medicare Coverage
Under Medicare’s Secondary Payer policy, workers' compensation must cover any treatment for a work-related injury before Medicare intervenes. However, if immediate medical expenses arise prior to the receipt of the workers' compensation settlement, Medicare may pay first and initiate a recovery process managed by the Benefits Coordination & Recovery Center (BCRC).
The Centers for Medicare & Medicaid Services (CMS) typically monitors the amount received from workers' compensation for medical care related to the injury or illness to avoid a recovery process. In some cases, Medicare may ask for the establishment of a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover the care after the WCMSA has been exhausted.
Reporting Requirements for Workers' Compensation Settlements
When a settlement exceeds $25,000, or $250,000 for individuals who will qualify for Medicare within 30 months, workers' compensation must submit a Total Payment Obligation to the Claimant (TPOC) to CMS. This report confirms the total amount owed to the beneficiary or on their behalf.
Frequently Asked Questions
To address questions or concerns, contact Medicare at 800-MEDICARE (800-633-4227, TTY 877-486-2048). Medicare offers a live chat service on Medicare.gov during certain hours. For queries about the Medicare recovery process, contact the BCRC at 855-798-2627 (TTY 855-797-2627).
A Medicare set-aside is voluntary, but if a beneficiary chooses to establish one, the workers' compensation settlement must exceed $25,000 or $250,000, as mentioned earlier. Additionally, misusing funds from a Medicare set-aside arrangement can lead to claim denials and reimbursement obligations.
Key Considerations
To properly manage a workers' compensation settlement as a Medicare beneficiary and prevent claim denials and reimbursement obligations, report the settlement promptly to CMS, allocate sufficient funds in the settlement for future medical costs (via WCMSA), maintain accurate records, and stay up-to-date on CMS policies and updates.
For more resources on navigating the complexities of medical insurance, visit our Medicare hub.
- Medicare beneficiaries need to be aware that their workers' compensation benefits could impact Medicare's coverage of medical claims related to work-related injuries.
- If a workers' compensation settlement exceeds $25,000 or $250,000 for individuals qualifying for Medicare within 30 months, the settlement must be reported to the Centers for Medicare & Medicaid Services (CMS).
- Establishing a Medicare set-aside arrangement (WCMSA) is voluntary, but if chosen, it requires the workers' compensation settlement to exceed $25,000 or $250,000 and there may be consequences for misusing funds from such an arrangement.
