Navigating Workers' Compensation and Medicare: Essential Information to Understand
Light and Breezy Version:
Getting Medicare on board with a workers' comp deal is no joke. Skipping this step can lead to claim denials and having to pay Medicare back.
Workers' comp is insurance for folks who've been hurt or got sick due to their job. The Office of Workers' Compensation Programs (OWCP) under the Department of Labor handles this goodie, which is available for federal employees, their families, and more.
Failing to understand how workers' comp may impact Medicare coverage can create complications when it comes to paying for job-related medical expenses. So, it's essential to know what you're doing to avoid medical cost issues.
Workers' comp settlements: What's the deal with Medicare?
When it comes to Medicare's secondary payer policy, workers' comp needs to cover any treatment related to a work-related injury first.
If immediate medical expenses pop up before an individual receives their workers' comp settlement, Medicare might foot the bill first. This sets off a recovery process managed by the Benefits Coordination & Recovery Center (BCRC). To avoid this recovery process, the Centers for Medicare & Medicaid Services (CMS) generally keeps tabs on the amount a person receives from workers' comp for their injury or illness-related medical care.
In some cases, Medicare might ask for the establishment of a workers' comp Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover the care after all the money in the WCMSA has been spent.
Which settlements need to be reported to Medicare?
Workers' comp needs to pass on a Total Payment Obligation to the Claimant (TPOC) to CMS to ensure Medicare covers the appropriate portion of a person's medical expenses. This represents the total amount of workers' comp owed to the person or on their behalf.
TPOCs are necessary if a person is already enrolled in Medicare based on their age or SSDI, and the settlement is over $25,000. TPOCs are also necessary if the person is not currently enrolled in Medicare but will qualify for the program within 30 months of the settlement date, and the settlement amount is $250,000 or more.
In addition to workers' comp, a person must report to Medicare if they file a liability or no-fault insurance claim.
Got questions?
For all your questions, you can contact Medicare by phone at 800-MEDICARE (800-633-4227, TTY 877-486-2048). During certain hours, live chat is also available on Medicare.gov. If you have questions about the Medicare recovery process, you can contact the BCRC at 855-798-2627 (TTY 855-797-2627).
A Medicare set-aside is voluntary, but if you want to set one up, your workers' comp settlement needs to be over $25,000 or over $250,000 if you're eligible for Medicare within 30 months.
Yep, it's forbidden to use the money in a Medicare set-aside arrangement for anything other than what it's meant for. Using it for other purposes can result in claim denials and the need to pay Medicare back.
" Stay Tuned: What to Know About Medicare Set-Asides"
Takeaway
Workers' comp is insurance for job-related injuries or illnesses for federal employees and certain other groups.
It's essential that those enrolled in Medicare or who will soon be eligible educate themselves on how workers' comp may affect their Medicare coverage to avoid issues with medical expenses.
It's also crucial to inform Medicare about workers' comp agreements to avoid future claim rejections and reimbursement obligations.
Resources
For more resources to help navigate the complex world of medical insurance, check out our Medicare hub.
- A Medicare set-aside is a voluntary arrangement to keep funds separate for future health-and-wellness treatments and therapies-and-treatments related to a work-related injury, especially if the workers' comp settlement exceeds $25,000 or $250,000 within 30 months of Medicare eligibility.
- The Centers for Medicare & Medicaid Services (CMS) needs to be informed of a Total Payment Obligation to the Claimant (TPOC) from workers' comp to ensure Medicare covers the appropriate portion of a person's job-related medical expenses when the settlement exceeds $25,000, or if the individual is already enrolled in Medicare or will be eligible within 30 months.
- Avoid using the funds from a Medicare set-aside arrangement for anything other than health-and-wellness, as it may result in claim denials and the need to pay Medicare back for uncategorized expenses.
- To better understand the Medicare recovery process and avoid complications, seek information from resources such as the Benefits Coordination & Recovery Center (BCRC) or check out the Medicare hub for comprehensive guidance on navigating various medical insurance systems.
