From the February-22, 2010 issue of National Underwriter Property & Casualty • Subscribe!

Medicare Secondary Payer Deadline Delayed

Washington

The federal government has pushed back the deadline for reporting requirements under the Medicare Secondary Payer Act until next January, a decision greeted with relief by workers' compensation providers and self-insured risk managers.

The U.S. Department of Health and Human Services announced on Feb. 16 that it has agreed to push back the deadline for compliance from April 1, 2010, to Jan. 1, 2011.

The workers' comp industry, led by a task force chaired by officials of the American Insurance Association, had met with HHS officials to urge the delay. They argued that too many issues remain undecided for the federal government to ask workers' comp providers to start reporting the data by April 1.

"Pushing back the deadline is the right move, and I commend CMS [the Centers for Medicare and Medicaid Services] for making this decision," said Peter Foley, AIA's vice president for claims and chair of AIA's MSP Task Force.

"The insurance industry has every intention to comply with the requirements, but we want the industry's data to be put forward in the best way possible to CMS," Mr. Foley said.

The extension will allow both insurers and CMS to address a number of unresolved issues, according to Melissa Shelk, AIA's vice president of federal affairs.

"One particular concern we have raised is the difficulty of complying with the technological and privacy requirements," Ms. Shelk said. "It is our hope that in the coming months we'll be able to fix this and other concerns so that we can move forward and start complying with these requirements."

The decision provides "welcome relief for self-insured companies that would have experienced a significant hardship and possible financial penalties if they had been unable to implement these rules so soon," said Michael Ferguson, chief operating officer of the Self-Insurance Institute of America.

Mr. Ferguson said that property and casualty insurers as well as risk managers who self-insure have been working diligently for the past two years to meet the new reporting requirements.

The coalition lobbying for the implementation delay included representatives of the AIA, the SIIA and the National Association of Mutual Insurance Companies.

The new reporting provision was mandated under the Medicare, Medicaid and the SCHIP Extension Act of 2007.

The purpose of the reporting requirements is to ensure that Medicare remains the secondary payer when a Medicare beneficiary has medical expenses that fall under the primary responsibility of a liability, no-fault or workers' comp insurance plan (including those that are self-insured).

It also will allow Medicare to recover any conditional payments it has made that should have been paid by the primary insurance plan.

The Medicare Advocacy Recovery Coalition also applauded the delay.

"The industry has been working diligently to build an infrastructure to supply data to CMS, investing millions of dollars to ensure compliance with the data share regulation," said Roy Franco, co-chair of MARC and director of risk management services for Safeway Inc.

"Unfortunately, there have been unforeseen difficulties and unanswered questions regarding the reporting process, and everyone's ability to get the job done by April 1," he added in a statement.

An "Alert" on the delay posted by CMS allows testing to continue thru Dec. 31, 2010, and only begins live reporting on Jan. 1, 2011.

"This expansion of an additional nine months will allow time for both the agency and the industry to navigate system roadblocks and clarify open policy issues," said Katie Fox, co-chair of MARC, as well as MSP compliance and resolution manager for MedInsights Inc.

"The claims community will continue to exchange data with Medicare in a collaborative effort to improve the data reporting systems," added Marcia Nigro, assistant vice president and complex claim consultant for Sedgwick, in the MARC statement.

MARC member organizations are comprised of entities representing attorneys, brokers, insureds, insurers, insurance and trade associations, self-insureds and third-party administrators. (For more information about the group, go to www.marccoalition.com.)

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