Spotlight on WCMSAs – Nutshell Resource

July 30, 2024 / 5 min read

Starting April 4, 2025, CMS will require Section 111 Responsible Reporting Entities (RRE) to report several Workers’ Compensation Medicare Set-Aside (WCMSA) data points for all workers’ compensation settlements involving Medicare beneficiaries as part of TPOC reporting. This new reporting requirement suddenly places WCMSAs in CMS’ spotlight, and insurers need to consider several important factors regarding current WCMSA practices as they prepare for this new process as follows:

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Which WCMSAs are in scope?

Insurers will need to report WCMSA data points regarding all WC settlements involving Medicare beneficiaries. If a WCMSA is included, several data points related to the WCMSA will need to be reported - and this reporting is required regardless of whether the WCMSA was submitted and approved by CMS. Thus, even non-submit WCMSAs, evidenced based MSAs (EBMSAs), and non-threshold WCMSAs (MSAs included in settlements that do not meet CMS’ $25k WCMSA review threshold for Medicare beneficiaries) must be reported. Insurers will even have to report if no WCMSA is included in the settlement.

What data must be reported?

CMS will require RREs to submit the WCMSA amount, WCMSA funding method (lump sum or annuity), initial deposit amount, anniversary (annual deposit amount), and the WCMSA period. The WCMSA case control number and professional administer EIN will be optional fields.

Why is this a big deal?

CMS’ new process is a big deal because it will give CMS unprecedented visibility into the parties’ use (and non-use) of WCMSA arrangements as a means to prevent the risk of shifting the cost and responsibility to pay for medical treatment to Medicare in WC settlements. Up until this point CMS had no true means to identify and track WCMSAs unless the WCMSA was submitted and approved by CMS. Additionally, CMS on its recent TPOC/WCMSA Q&A call made clear that while CMS will accept TPOC data with the MSA Amount reported as $0, it reserves the right to review and audit the data if it suspects cost shifting to Medicare may have occurred.

What are key compliance points to consider?

There are several key compliance points to consider. First, by collecting this information, CMS expands its capability to identify WCMSAs in settlements and mark its Common Working File to coordinate benefits. This potentially impacts Medicare beneficiary coverage when WCMSA funds are available to pay primary. Second, it is important to remember that CMS’ $25k WCMSA review threshold regarding Medicare beneficiaries is NOT a “safe harbor,” and CMS has indicated that its interests need to also be considered when this threshold is not met. (See, CMS’ WCMSA Reference Guide, Section 8.1). Third, CMS will now have the key data points it needs to evaluate whether its interests have been adequately addressed –and, on this point, insurers may wish to reevaluate their non-threshold practices knowing that CMS has indicated that it reserves the right to use the data for this purpose when a MSA Amount is reported as $0.

How Verisk can help – improving WCMSA compliance

Managing these upcoming changes and staying compliant does not need to be complicated. Verisk has been a leader in Medicare Secondary Payer Compliance for over 20 years and we have taken several steps to assist our partners with preparing for CMS’ new TPOC/WCMSA reporting requirements as follows:

Section 111 Reporting: Our Section 111 platforms (MSP Navigator, iComply, CS CMS) will be ready to intake and report the additional data elements for testing in October 2024. Alerts and reports will be available to ensure the timely and accurate collection of this data just as has been the case with other critical Section 111 data.
Streamlining the process: Verisk also offers an optional add on solution within its Discovery Navigator solution that will upload/ scan settlement documents to automate the extraction of the required data elements. Discovery Navigator, our homegrown AI powered OCR product, drastically reduces the costs and time associated with reviewing medical records, and reviews settlement documents and can be utilized to extract and report the WCMSA data for Section 111 reporting.
Improving Compliance: Given CMS will have unprecedented visibility into MSA data, ensuring that all cases that require an MSA based on a client’s established protocols is critical. Leaving is up to the adjuster at the time of settlement creates compliance gaps and delays in settlement. Verisk’s new MSA Link solution utilizes your Section 111 claim data to automatically start preparing an MSA allocation in accordance with your established best practices and protocols.
Non-Threshold Cases: With CMS now collecting data on all cases regardless of threshold, Verisk has established a data-driven WCMSA compliance option, Data-Driven MSA, for Medicare beneficiary non-threshold cases (WC settlements less than $25k). This cost-effective automated allocation fuels compliance by facilitating a consistent approach to accurately allocate funds to non-threshold cases.
Settlement: we can review your settlement language to help you address Medicare compliance obligations and memorialize the data that will need to be sent to CMS in accordance with the agency’s new Section 111 reporting requirements.
Training: we can help with education and training related to the upcoming changes.

Holistic MSP compliance: By combining our industry leading Section 111 reporting services (MSP Navigator), with data driven lien resolution (CP Link) and future allocation (MSA Link) solutions, Verisk can facilitate an automated and holistic MSP compliance program that mitigates risk while optimizing critical adjuster resources.

Questions?

For more information on how we can help contact Brian Cowan at brian.cowan@verisk.com. Also, be sure to review our supplementary article for a more in-depth review of CMS’ new process.