Understanding the Intersection of Workers' Compensation and Medicare: Crucial Information

Understanding the Intersection of Workers' Compensation and Medicare: Crucial Information

Injuries or illnesses at work can turn tricky when both workers' compensation and Medicare come into play. Failing to inform Medicare about a workers' compensation arrangement can lead to reimbursement obligations and even claim rejections.

Workers' compensation is essentially insurance for employees covering job-related injuries or diseases. The Office of Workers' Compensation Programs (OWCP) under the Department of Labor manages this insurance for federal employees, their families, and certain other entities.

It's crucial for those enrolled in Medicare or soon to be eligible to understand the impact of workers' compensation on their Medicare coverage to dodge potential medical expense complications.

Workers' Comp Settlement & Medicare

Under Medicare's secondary payer policy, workers' compensation must foot the bill for any treatment related to a work-related injury. However, if immediate medical expenses arise before the settlement, Medicare may pay first and initiate a recovery process overseen by the Benefits Coordination & Recovery Center (BCRC). To avoid such a process, the Centers for Medicare & Medicaid Services (CMS) recommends monitoring the amount a person receives from workers' compensation for injury-related medical care. In some situations, Medicare may ask for a workers' compensation Medicare set-aside arrangement (WCMSA) for these funds. Medicare will only cover care after the WCMSA funds have been fully utilized.

Reporting Workers' Comp Settlements to Medicare

Workers' compensation must submit a total payment obligation to the claimant (TPOC) to CMS, representing the total amount of workers' compensation the person is owed or on their behalf. Submitting a TPOC is requisite if a person is already enrolled in Medicare due to their age or receiving Social Security Disability Insurance, and the settlement is $25,000 or more. Furthermore, if the person is not enrolled in Medicare yet but will qualify within 30 months of the settlement date, and the settlement amount exceeds $250,000, they should also submit a TPOC.

Additionally, a person must report to Medicare if they file a liability or no-fault insurance claim.

Questions and Answers

Individuals can contact Medicare with any queries over the phone at 800-MEDICARE (800-633-4227, TTY 877-486-2048). During select hours, a live chat on Medicare.gov is also available. If someone has questions about the Medicare recovery process, they can reach out to the BCRC at 855-798-2627 (TTY 855-797-2627).

A WCMSA is voluntary, but if a Medicare beneficiary wants to set one up, their workers' compensation settlement should be over $25,000. Alternatively, it should exceed $250,000 if the person is eligible for Medicare within 30 months.

Misusing the funds in a Medicare set-aside arrangement can lead to claim denials and having to repay Medicare.

Learn More: What to know about Medicare Set-Asides

Key takeaways:

1. Workers' compensation is insurance for job-related injuries or illnesses for federal employees and certain groups.
2. People enrolled in Medicare or soon to be eligible should be informed about how workers' compensation can affect their Medicare coverage to evade medical expense issues.
3. It's important to inform Medicare about workers' compensation arrangements to avoid future claim rejections and reimbursement obligations.

For additional resources to navigate the intricate world of medical insurance, check out our Medicare hub.

1. Medicare's secondary payer policy requires workers' compensation to cover treatments related to work-related injuries, but if immediate expenses occur before settlement, Medicare may pay first and initiate a recovery process.
2. It is mandatory for those who are enrolled in Medicare or soon to be eligible, and receive a workers' compensation settlement of $25,000 or more, to submit a Total Payment Obligation to the claimant (TPOC) to Medicare.
3. A Medicare beneficiary can voluntarily set up a Medicare set-aside arrangement (WCMSA) for funds if their workers' compensation settlement exceeds $25,000, or $250,000 if eligible for Medicare within 30 months.
4. Misusing the funds in a Medicare set-aside arrangement can result in claim denials and the need to repay Medicare.

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