Workers' Compensation and Medicare: Essential Information Explained
Navigating the health insurance landscape doesn't get much more crucial than notifying Medicare about your workers' comp arrangement.Failing to do so could mean denials of claims and having to repay Medicare.
Workers' comp offers financial support to employees who have sustained injuries or illnesses directly due to their jobs. Overseeing this beneficial program is the Office of Workers' Compensation Programs (OWCP), under the Department of Labor. It's designed to offer protection for federal workers, their families, and certain other entities.
If you're enrolled in Medicare or are planning to join shortly, it's vital to grasp how workers' comp might impact Medicare's coverage of your medical claims. This helps safeguard you from potential complications concerning costs for injuries or illnesses incurred while on the job.
How does a workers' comp settlement affect Medicare?
Medicare operates under its secondary payer policy, which means workers' comp must foot the bill for any treatment stemming from a work-related injury. That is, until the person receives their workers' comp settlement.
However, if immediate medical expenses arise before the individual gets their workers' comp settlement, Medicare may step in and start a recovery process handled by the Benefits Coordination & Recovery Center (BCRC). To sidestep this recovery process, the Centers for Medicare & Medicaid Services (CMS) tends to keep a close eye on the amount a person receive in relation to their work-related injury- or illness-related medical care.
In specific cases, Medicare might ask for the establishment of a workers' compensation Medicare set-aside arrangement (WCMSA) to manage these funds. Medicare won't cover treatment until the funds in the WCMSA are spent.
What settlements need to be reported to Medicare?
Workers' comp must send a total payment obligation to the claimant (TPOC) to CMS to ensure Medicare covers the right portion of their medical expenses. This represents the total amount of workers' comp owed to the person or on their behalf.
Reports need to be sent to CMS if the person is already enrolled in Medicare due to age or receiving Social Security Disability Insurance, and the settlement is $25,000 or more. If the person isn't enrolled in Medicare yet but will be within 30 months of the settlement date, and the settlement amount is $250,000 or more, reports also need to be filed.
Apart from workers' comp, a person should also report to Medicare if they submit a liability or no-fault insurance claim.
Frequently Asked Questions
Questions for Medicare can be directed by phone at 800-MEDICARE, or via live chat on Medicare.gov during specified hours. If there are questions regarding the Medicare recovery process, they can reach out to the BCRC at 855-798-2627 (TTY 855-797-2627).
A WCMSA is elective, but if a Medicare beneficiary wishes to establish one, their workers' comp settlement should exceed $25,000. Alternatively, it should exceed $250,000 if they're eligible for Medicare within 30 months.
Yes, misusing funds from a WCMSA for anything other than their designated purpose is forbidden. Breaching these rules can result in claim denials and the requirement to repay Medicare.
Quiz
- What is the purpose of workers' compensation?
- Who is responsible for overseeing the workers' compensation program?
- Why is it crucial to notify Medicare of workers' comp arrangements?
- What is the role of the Benefits Coordination & Recovery Center (BCRC)?
- What is the purpose of a Medicare set-aside arrangement (WCMSA)?
- What settlements require submission to CMS?
Key Takeaways
- Workers' compensation serves as insurance for job-related injuries or illnesses for federal employees and certain groups.
- Ensuring that those enrolled in Medicare or soon to be eligible educate themselves on how workers' comp may affect Medicare coverage is vital to prevent issues with medical expenses.
- Informing Medicare about workers' compensation agreements mitigates future claim rejections and repayment obligations.
- In cases where employees have sustained injuries or illnesses directly due to their jobs, workers' comp provides financial support.
- The Office of Workers' Compensation Programs (OWCP), under the Department of Labor, oversees this beneficial program, designed to offer protection for federal workers, their families, and certain other entities.
- Failure to notify Medicare about workers' comp arrangements could result in denials of claims and the need to repay Medicare.
- The Benefits Coordination & Recovery Center (BCRC) manages the recovery process when Medicare steps in to cover immediate medical expenses before an individual receives their workers' comp settlement.
- A Medicare set-aside arrangement (WCMSA) is established to manage funds from workers' comp settlements for medical care, with Medicare not covering treatment until the funds in the WCMSA are spent.
- Workers' comp settlements that exceed either $25,000 or $250,000 (depending on the individual's enrollment status in Medicare) must be reported to CMS. Apart from workers' comp, liability or no-fault insurance claims also need to be reported.
