Maryland Expands the Scope of the MSP Statute
In January 2010, the Maryland Workers Compensation Commission issued an emergency policy concerning workers’ compensation settlements that close out future medical benefits.
The effect of this policy is that most Maryland workers’ compensation settlements include either an MSA or a medical explanation as to why no MSA is warranted. In follow up to the emergency policy, the Maryland Commission has now promulgated permanent rules that make Maryland the first state in the country to require conditional payments and MSA assessments in every settlement.
The three ways the Commission recommends accounting for future medical treatment are either with a formal MSA approved by CMS, an apportionment of future medical treatment based on the settlement amount, or a medical opinion that no future medical treatment is required. Crowe Paradis can provide not only all three of these services, but also consult on the most appropriate means of protecting Medicare’s interest.
In addition to choosing the right vehicle for meeting both CMS and the Maryland Commission’s requirements, [there are best practices that must be woven into all settlements in Maryland.] With these compliance challenges in mind, Crowe Paradis suggests the following protocol for Maryland workers’ compensation cases:
- 1. Determine Medicare eligibility. This is always the first step in any MSP compliance program. Whether eligible for Medicare or not, your answer to this question will guide you in your approach to compliance with the MSP and the Commission.
- 2. Investigate and negotiate conditional payments. Under the Maryland rules, conditional payments need to be addressed by the time of the settlement. The conditional payment process can take months and will be labor intensive. As soon as Medicare eligibility is established, begin looking into conditional payments and look to dispute charges that are unrelated. Conversely, if the claimant is not a Medicare beneficiary, there will not be conditional payments.
- 3. Determine the best way to handle future medical treatment. If the claimant’s settlement meets the applicable CMS review thresholds, have a formal MSA done and submitted to CMS for review and approval. The Commission has been clear that whether the claim meets CMS review thresholds or not, it wants future medicals addressed within the settlement. If the settlement falls into Class III cases that do not meet CMS review thresholds do one of the following:
- Complete a formal MSA, but do not submit to CMS for review and approval. Since the review thresholds are not met, you can settle your claim with language and setting the MSA amount aside.
- Have an experienced legal and medical evaluator review the medical records and legal documents to apportion an amount of money for future treatment. In Crowe Paradis’ experience, this could turn out to be a zero allocation, depending upon the facts and circumstances.
- Seek a medical evaluator to opine that no future medical treatment is needed for the claimant.
Provided that future medical treatment is adequately incorporated into the settlement and conditional payments are addressed, the Commission should approve. This regulation makes Maryland the only state in the nation to require on every single case that some process is used to ensure that the Medicare Secondary Payer statute is honored. In doing so, the Maryland Workers’ Compensation Commission has expanded the definition what constitutes consideration of Medicare’s interest.
Louis D. Porrazzo, Jr., is Crowe Paradis’ National Account Executive. In his capacity, he assists carriers, TPAs and self-insureds in developing comprehensive MSP compliance solutions. Lou is a graduate of Stonehill College and Suffolk University Law School, and is a member of the Massachusetts Bar.