CMS discusses general WCMSA compliance points on its June 17th webinar

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

June 20, 2025 / 9 min read

On June 17^th, the Centers for Medicare and Medicaid Services (CMS) held an “Introduction to Workers’ Compensation Medicare Set-Asides (WCMSAs) Webinar.” Per CMS’s webinar notice, “[t]he intent of this webinar [was] to go over the basics of WCMSAs including purpose, submission guidelines and administration as well as to offer some WCMSA best practices.”^[1]Of note, this webinar comes on the heels of CMS’s March webinar in which the agency provided a general overview of its conditional payment recovery process.

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Overall, in keeping with CMS’s webinar notice, CMS provided a high-level discussion and review of several aspects related to WCMSA arrangements, its submission process, and referenced certain points and considerations to help parties better navigate its WCMSA process.

The authors attended this webinar and present a general overview of key topics discussed by CMS as follows:

WCMSAs – general points

CMS started the session by first noting that a WCMSA is a financial agreement to set-aside a portion of the workers’ compensation (WC) settlement to cover future medical expenses related to the work injury and could represent anything from a fraction up to the entirety of a financial agreement intended to resolve a WC claim.^[2]In addition, CMS indicated that the purpose of WCMSAs is to protect Medicare’s interests by ensuring funds are available to cover work-related injury medical costs when the claimant is a Medicare beneficiary (or likely to soon become a Medicare beneficiary). ^[3]CMS also noted that a WCMSA is not necessary in situations where the claimant is only being compensated for medical expenses prior to settlement and there is no evidence that the claimant is attempting to maximize other aspects of the settlement, such as lost wages or disability portions of the settlement, to Medicare’s detriment.^[4]For more information on this point, see CMS’s WCMSA Reference Guide, Section 4.2.

WCMSA calculation and funding basics

CMS provided a general overview of how it calculates WCMSAs. In this regard, CMS noted that it bases WCMSA calculations on severity of injury, expected future medical costs, the claimant’s age, and the claimant’s health status.^[5] In terms of WCMSA funding, CMS noted that WCMSAs are generally funded either through a lump sum payment or via a structure/annuity arrangement.^[6] Regarding WCMSAs funded by structure/annuity, CMS noted that the initial deposit is required to cover the first surgery or procedure for each body part, and/or the first equipment replacement for each body part, plus the first two years of annual payments.^[7]

WCMSA submission/non-submission

CMS reiterated that its WCMSA review process is voluntary, and that there is no statutory or regulatory requirement to submit a WCMSA to CMS for review regarding those settlements that meet the agency’s WCMSA review thresholds.^[8]However, while CMS acknowledged its review process is voluntary, the agency stated that it recommends WCMSA submission as CMS approval provides parties with certainty that the WCMSA adequately protects Medicare’s interests.^[9]On this point, CMS stated that its voluntary review process “guarantees” Medicare will resume payments upon appropriate exhaustion of WCMSA funds.^[10]Conversely, CMS stated that it cannot guarantee that a non-approved WCMSA appropriately protects Medicare’s interests and premature exhaustion of that WCMSA could leave a claimant at risk of Medicare denying claims.^[11]Further, regarding non-approved WCMSAs, CMS noted that it will use the information from these arrangements to coordinate benefits, whether provided by the claimant or the carrier via Section 111 reporting.^[12]In addition, CMS noted that it expects non-approved WCMSAs will follow its procedures regarding WCMSA fund disposition, including attestations regarding how the WCMSA funds are used and appropriate exhaustion.^[13]

CMS will only review WCMSAs that meet its “review thresholds”

CMS reminded the audience that it will only review a WCMSA proposal in situations where the WC settlement meets one of its WCMSA review thresholds as follows: (1) the claimant is a Medicare beneficiary, and the total settlement amount is greater than $25,000 or (2) the claimant has a “reasonable expectation” of Medicare enrollment within 30 months of the settlement date and the anticipated total settlement is greater than $250,000.^[14]For information regarding how CMS defines “total settlement amount,” see WCMSA Reference Guide, Section 8.1. Also, see WCMSA Reference Guide, Sections 10.1 and 10.5.3 for how CMS defines “reasonable expectation” of Medicare enrollment. Further, CMS noted that it will not issue “verification letters” stating that a WCMSA is unnecessary.^[15]

CMS’s new $0 WCMSA policy – effective 7/17/25

CMS also referenced its upcoming $0 WCMSA policy change noting that effective July 17, 2025, CMS will no longer accept or review $0 WCMSA proposals.^[16]Overall, CMS did not go into detail or elaborate regarding this forthcoming policy change. However, for more information on CMS’s new $0 WCMSA policy, please see our recent article CMS’s New $0 WCMSA Policy Starts 7/17/25 – Key Points and How Verisk Can Help.

WCMSA submission – process and workflow

CMS noted that WCMSAs may be submitted either through its Workers’ Compensation Medicare Set-Aside Portal (WCMSAP), which is its preferred method, or via regular mail.^[17]On this point, the authors note that Section 11.1.1 of the WCMSA Reference Guide references that the WCMSAP has been designed to improve the efficiency of the WCMSA submission process, allowing electronic submission of WCMSAs, and streamlining the WCMSA submission process. In terms of the WCMSA review process, CMS noted that upon receipt of a WCMSA its contractor, the Workers’ Compensation Review Contractor (WCRC), reviews the submission for completeness, notifies the submitter if additional information is needed, and evaluates the submission for medical and prescription treatments and costs.^[18]CMS further noted that the WCRC may “develop” the file if additional information is needed and will request that information from the submitter. As part of the development process, CMS stated that it is important to submit the requested information within the WCRC’s noted time parameters or the file will be closed. Further, CMS noted that once the WCRC recommends the final approved WCMSA amount it sends an approval letter to the submitter.^[19]The submitter is then required to send the final settlement agreement to the WCRC. From there, CMS’s records are updated so that CMS does not pay for injury-related claims.^[20]

WCMSA submission – points for consideration

CMS noted that parties should make sure their WCMSA proposal contains complete case files and should avoid comingling documentation.^[21]Further, CMS stated that parties should not submit more than 200 pages or more than two years of medical records.^[22]In addition, CMS noted that previously submitted records should not be resubmitted unless it has been confirmed that these records have not been received.^[23]CMS also stressed that parties should allow 45 business days after CMS receives a complete WCMSA submission before contacting the WCRC for a status update.^[24]

WCMSA account set-up/administration

CMS also discussed the set up and administration of the WCMSA funds by noting that WCMSA funds can either be professionally administered or self-administered, with CMS recommending professional administration.^[25]Regardless of the type of administration, all WCMSA funds must be deposited in an interest-bearing account and must be kept separate from any other account, such as personal savings or checking accounts.^[26]CMS indicated that the funds would be appropriately used in a situation where the claimant incurs medical and drug expenses related to the WCMSA injury and there is money in the WCMSA.^[27]CMS noted that WCMSA funds can be used for administrative fees relating to the WCMSA account such as the cost of copying documents, mailing fees/postage, banking fees related to the account, and income tax on interest income from the account, however fees for trustees, custodians, or other professionals hired to help administer the account, attorney costs for establishing the MSA, and Medicare premiums/co-payments/deductibles would not be appropriate uses for WCMSA funds.^[28]

CMS also indicated that an annual attestation must be submitted each year attesting to the fact that payments from the WCMSA account were made for Medicare covered medical expenses and prescription drug expenses related to the work-related injury.^[29]These attestations must be submitted no later than thirty days after the end of each year, should continue through the depletion of the WCMSA account, and for all types of WCMSAs, including lump sum and structured settlements as well as WCMSAs approved via CMS’ voluntary process and those calculated using other means. ^[30]

WCMSA “Re-Review” and “Amended Review”

CMS indicated there are two processes by which parties may challenge a CMS decision: Re-Review and Amended Review. CMS explained that a Re-Review request occurs when the submitter believes CMS’s recommended WCMSA value is the result of a mathematical error, missing documentation, or other submission error.^[31]Submitters are limited to no more than one request per type of challenge, and the Re-Review request must be submitted in the same manner the original WCMSA submission was submitted if there has not been a change in submitter. ^[32]

Regarding Amended Review, this process, in general, allows parties a one-time request to submit new medical documentation to adjust a prior WCMSA approval for cases meeting the Amended Review requirements. To be eligible for an Amended Review, CMS noted that the following criteria must be met: the case has not yet settled as of the date of the request for Amended Review and the projected care has changed so much that the submitter’s new proposed amount would result in a 10% or $10,000 change (whichever is greater) from CMS’s previous approved amount.^[33]CMS indicated that an Amended Review request can be submitted by mail or via the WCMSAP if the original WCMSA was submitted via the WCMSAP, however if the original submission was mailed, the Amended Review request must be submitted by mail. ^[34]For more information on CMS’s Amended Review process, see WCMSA Reference Guide, Section 16.4 and our recent article A New Day for WCMSA Amended Review Requests Start April 7^th.

Notice of Settlement Letter (NEW)

CMS indicated that a Notice of Settlement Letter will be issued to the claimant when CMS receives notification that a claim has settled, and that settlement includes a WCMSA. The letter indicates that the WCMSA information will assist CMS in making appropriate coordination of benefits decisions and that CMS expects the WCMSA funds to be used to pay for the necessary medical and pharmacy care related to the workers’ compensation claim with the intent to protect the Medicare program. A sample of this letter can be found in WCMSA Reference Guide, Appendix 5.

Additional Resources

Shortly after the presentation, CMS posted its webinar power point on the CMS website. As will be noted, on slide 25 CMS provides links to numerous WCMSA resources, including a link to its WCMSA Reference Guide. CMS referenced these resources on the webinar and the reader may find them helpful in further reviewing CMS’s WCMSA process.

Questions?

Please do not hesitate to contact the authors if you have any questions regarding the information outlined above. In the interim, please see our Medicare Set-Asides (MSA) Brochure which provides an overview of our various WCMSA options and WCMSA cost-mitigation services, as well as information on our new MSA Link and Data-Driven MSA services which can help you optimize and simplify compliance with CMS’s new TPOC/WCMSA reporting requirements.

[1] See, CMS’s webinar notice

[2] CMS’s Introduction to WCMSAs Webinar, June 17, 2025, Slide 2.

[3] Id.

[4] Id. at Slide 6.

[5] CMS’s Introduction to WCMSAs Webinar, June 17, 2025, Slide 5.

[6] Id.

[7] Id. at Slide 8.

[8] Id at Slide 9.

[9] Id.

[10] Id.

[11] Id.

[12] Id. at Slide 16.

[13] Id.

[14] CMS’s Introduction to WCMSAs Webinar, June 17, 2025, Slide 14.

[15] Id. at Slide 6.

[16] Id.

[17] CMS’s Introduction to WCMSAs Webinar, June 17, 2025, Slide 10.

[18] Id. at Slide 11.

[19] Id. at Slide 12.

[20] Id.

[21] CMS’s Introduction to WCMSAs Webinar, June 17, 2025, Slide 23.

[22] Id.

[23] Id.

[24] Id.

[25] CMS’s Introduction to WCMSAs Webinar, June 17, 2025, Slide 17.

[26] Id.

[27] Id.

[28] Id. at Slide 19.

[29] Id. at Slide 20.

[30] Id.

[31] CMS’s Introduction to WCMSAs Webinar, June 17, 2025, Slide 13.

[32] Id.

[33] Id.

[34] Id.