CMS announces new WCMSA Part D data share and coordination of benefits option for Feb. 2026

By Mark Popolizio, J.D., Shawn Johnson, J.D.

December 4, 2025 / 7 min read

The Centers for Medicare and Medicaid Services (CMS) has announced that it will start sharing WCMSA prescription drug information with its Medicare Part D sponsors (RX providers) beginning February 2026. In addition, CMS has established a new adjudication option to aid Part D coordination of benefits efforts for Part D enrollees with WCMSAs.

woman talking to pharmacist

Summary

CMS has recently released a memo announcing that starting February 2026 it will provide its Part D sponsors (RX drug providers) with workers’ compensation Medicare set-aside (WCMSA) related prescription drug information and additional data elements which they can use “to improve coordination accuracy and prevent improper Part D payments” in relation to WCMSAs.

CMS notes that it is implementing this enhanced data sharing to help “Part D sponsors’ efforts in the coordination of benefits with [WCMSA] arrangements.” CMS issued this memo to provide its Part D sponsors with information regarding these changes and “updated policy guidance” for its Part D sponsors regarding “the implementation of beneficiary-level prior authorization requirements based on WCMSA-related prescription drug data.”

Regarding Part D coordination of benefits, CMS notes that since the beginning of the Part D program, Part D sponsors have been required to make conditional primary payments for individuals with non-group health plan (NGHP) insurance coverage (including workers compensation), unless the sponsor establishes that a drug is used exclusively to treat an injury related to that coverage. In those instances where a Part D enrollee has a WCMSA, the plan sponsors have historically been required to make conditional primary payment for the prescription and then contact the WCMSA administrator to determine which claims should not be paid by the Part D sponsor.

However, as part of the February 2026 implementation of WCMSA data sharing, CMS is introducing a new “alternative method” to aid Part D secondary payer efforts. Specifically, CMS has announced a new prior authorization and point of sale option regarding beneficiaries with a WCMSA arrangement.

In terms of anticipated impact, this data share does not make any changes to the NGHP Section 111 reporting process (including the recent WCMSA/TPOC reporting requirements) or the WCMSA voluntary submission process.

Rather, where we would expect the biggest impact of this development is on the post-settlement WCMSA administration process involving the claimant’s administration of his/her set-aside, with Part D plans potentially utilizing WCMSA data to coordinate benefits with regards to prescription drugs included in the WCMSA. On this point, Part D plans may use a prior authorization or point of sale edit to coordinate benefits.

For those interested in a more in-depth overview of these updates and their potential WCMSA impact, the authors present the following:

How CMS’s new RX Data-Share will work

As noted, beginning in February 2026, CMS will provide Part D sponsors with WCMSA related prescription drug information. CMS states that it will provide this information to the Part D sponsors through a new Medicare Beneficiary Database Other Health Insurance Monthly (MBDOHIMO) file, to be transmitted as a companion file to the Coordination of Benefits-Other Health Insurance (COB-OHI) file.^[1]

CMS notes that its sponsors can expect to begin receiving the MBDOHIMO file on the same schedule as other monthly files.^[2]Further, CMS advises that the newly provided data will include the Workers’ Compensation Case Control Number and up to 12 National Drug Codes (NDCs) for each applicable WCMSA.^[3]CMS references that its file layout for the new MBDOHIMO file can be found in the appendix to its memo.^[4]

CMS’s new “prior authorization” and “point of sale” coordination of benefits adjudication option for Part D sponsors

CMS notes that once Part D sponsors receive WCMSA RX data, they can continue to follow the procedures outlined in Section 50.12.1, Chapter 14 of the Medicare Prescription Drug Benefit Manual to determine which prescriptions should not be paid under Part D.^[5]

Alternatively, CMS has announced that its Part D sponsors can adopt the alternate method of MSP adjudication as outlined in CMS’s memo. Specifically, CMS describes the new adjudication option as follows: “Under the alternative method, instead of making conditional primary payments while awaiting coordination with a WCMSA administrator, for those enrollees with NDCs provided via the MBDOHIMO file sponsors may utilize the information provided to introduce prior authorization requirements and implement beneficiary-level point-of-sale edits for the drugs identified for that enrollee’s WCMSA.”^[6]

This new option is outlined, in general, as follows:

Per CMS, Part D sponsors who are able to program point-of-sale edits may apply such edits to drugs represented by the NDCs’ indicated MBDOHIMO file and should further apply edits to all NDCs corresponding to that drug’s RxNorm Ingredient.^[7]The memo instructs Part D sponsors unable to program point-of-sale edits according to the instructions in the memo to continue to follow the prior process outlined in Chapter 14 of the Prescription Drug Benefit Manual. ^[8]

CMS further notes that when a Part D sponsor rejects a claim from a network pharmacy under this alternative method, notice must be provided to the Part D enrollee of their right to request a coverage determination from their plan.^[9]To minimize coverage disruption, “CMS expects sponsors to accept an attestation by the WCMSA administrator or enrollee that the requested drug is not related to the workers’ compensation injury as sufficient evidence for Part D to serve as the primary payer and resolve the edit.”^[10]

CMS’s memo indicates that CMS expects Part D sponsors to update their systems and resume payment for prescription drugs once the WCMSA funds have been exhausted. On this point, CMS notes that WCMSAs may be funded as structured settlements, where a beneficiary receives funding for the WCMSA on an annual basis.^[11]In these situations, WCMSA funds may exhaust in a given year, but may be replenished in subsequent years. For WCMSA tracking purposes, CMS recommends that Part D sponsors review the COB-OHI Primary Record, which contains additional WCMSA data including the termination date, the WCMSA administrator’s name and contact information, the WCMSA indicator, the WCMSA settlement date, and the associated diagnosis codes.^[12]

As part of this new option, CMS notes that there are several limitations to this alternative method of MSP adjudication and it may not be applicable in all cases, with data supplementing investigation of WCMSAs continuing to be found outside of the MBDOHIMO file. For instance, CMS notes they cannot transmit NDCs on all existing WCMSAs, there may be situations where an WCMSA may include more than the maximum of 12 drugs which can be listed on the MBDOHIMO file, and drugs that are not listed in the WCMSA may be prescribed for treatment of the workers compensation injury.^[13]

CMS states that in situations where a sponsor believes that a drug is associated with a workers’ compensation injury, but the drug does not match those listed in the MBDOHIMO file, the sponsor must continue to provide conditional primary payment and contact the WCMSA administrator to confirm coverage for the drug.^[14]

Compliance considerations

As noted above, CMS’s Part D memo to its Part D sponsors does not change any NGHP Section 111 reporting obligations or the WCMSA voluntary submission process and is not anticipated to have any impact on those processes for NGHP Responsible Reporting Entities (RREs).

In the big picture, CMS’s memo, combined with the agency’s recent updates requiring NGHP RREs to include WCMSA information when reporting workers’ compensation TPOCs can be viewed as the latest in CMS’s ongoing efforts to obtain data and utilize that data for coordination of benefits purposes.

While the recent WCMSA/TPOC updates require NGHP RREs to include certain WCMSA information to CMS when reporting a workers’ compensation TPOC, prescription drug information, including NDC codes, are not data points that are transmitted to CMS via the Section 111 reporting process. Given this, it is the authors’ belief that prescription drug information will only be available to CMS for WCMSAs which were submitted and approved through the WCMSA voluntary submission process. As part of that process, an NDC code will be listed for each prescription drug included in CMS’s approval letter outlining the services and prescriptions allocated under the WCMSA. As such, the authors anticipate this data will only be available to be provided to Part D sponsors for situations where a WCMSA was submitted to CMS, approved through their voluntary submission process, and where the settlement was subsequently reported to CMS.

Where the authors do anticipate potential impacts from this upcoming data share is on the post-settlement administration process for WCMSAs. With the upcoming alternative method of adjudication allowing Part D sponsors to introduce prior authorization and point of sale edits to enrollee records, Medicare beneficiaries with a WCMSA and individuals or entities administering WCMSAs on behalf of Medicare beneficiaries providing timely and accurate attestations regarding WCMSA funding to CMS will be important to ensure proper coordination of benefits.

Questions?

Please do not hesitate to contact the authors if you have any questions regarding the upcoming WCMSA data share or any Medicare Secondary Payer issues.

[1] Duran, Vanessa S. Center for Medicare & Medicaid Services. (2025, November 19). Coordination of Benefits-Other Health Insurance (COB-OHI) Companion File to Include Data on Workers’ Compensation Medicare Set-Aside (WCMSA) Arrangements.

[2] Id.

[3] Id.

[4] Id.

[5] Duran, Vanessa S. Center for Medicare & Medicaid Services. (2025, November 19). Coordination of Benefits-Other Health Insurance (COB-OHI) Companion File to Include Data on Workers’ Compensation Medicare Set-Aside (WCMSA) Arrangements.

On this point, CMS states as follows: “Section 1862(b) of the Social Security Act (the Act) makes workers’ compensation coverage primary to Medicare. To comply with these requirements and ensure that workers’ compensation settlements appropriately cover future medical services, workers’ compensation plans and individuals eligible for Medicare or likely to become eligible for Medicare may establish WCMSA arrangements. The primary payer status of workers’ compensation funds was made applicable to Medicare Part D through section 1860D-2(a)(4) of the Act, codified in CMS regulations at 42 CFR § 423.462(a). Since the beginning of the Part D program, CMS has required Part D sponsors to make conditional primary payment for individuals with non-group health plan coverage (such as that provided by workers’ compensation) unless the sponsor has established that a certain drug is used exclusively to treat an injury related to that coverage. In the case of Part D enrollees with WCMSAs, section 50.12.1 of Chapter 14 of the Medicare Prescription Drug Benefit Manual requires sponsors to make conditional primary payment and contact the WCMSA administrator to determine which claims should not be paid under Part D.” Id.

[6] Duran, Vanessa S. Center for Medicare & Medicaid Services. (2025, November 19). Coordination of Benefits-Other Health Insurance (COB-OHI) Companion File to Include Data on Workers’ Compensation Medicare Set-Aside (WCMSA) Arrangements.

[7] Duran, Vanessa S. Center for Medicare & Medicaid Services. (2025, November 19). Coordination of Benefits-Other Health Insurance (COB-OHI) Companion File to Include Data on Workers’ Compensation Medicare Set-Aside (WCMSA) Arrangements.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id.

[13] Id.

[14] Id.