Fact Check Time for LMSA/NFMSA Developments

By Kendell Gracey June 6, 2017

It is no secret that CMS has announced (for years) its intention to expand the workers’ compensation MSA program into the liability and no-fault arena. But the real question today is: What, when, and how is CMS going to step into this new arena and how will it affect claims management? CMS has provided little clarity or certainty on this topic, which in turn has often spurred misinformation, confusion, or unnecessary concern within the industry.

Here’s what we know for sure

  • The Workers’ Compensation Review Contractor Solicitation and accompanying Statement of Work state that the LMSA/NFMSA program will be “optional.”
  • Neither CMS nor providers are going to design or implement the details of the program as that responsibility falls to the WCRC (who will be selected soon).
  • The details of when, how, and what the LMSA/NFMSA program will look like are still to be determined because the WCRC has yet to be selected.
  • The optional program is not expected to go live before July 1, 2018 and is contingent on CMS officially making the choice to initiate the program (which it has not done).
  • CMS estimations of the annual volume of liability and no-fault claims that may be part of the program vary widely and are dependent on industry feedback (which hasn’t happened yet).
  • The MSP statute has not been amended and no new Code of Federal Regulations have been issued.

And then, there’s this:

It is worth noting a few other key facts of the current LMSA/NFMSA situation. The most recent SOW (Amendment 3, issued in Feb 2017) for the WCRC omitted all information relating to the cursory review of the estimated 40,000 annual LMSAs/NFMSAs. The initial draft and the two prior SOW versions (December 2016 and January 2017) all included that section and reference about the 40,000 cursory reviews. CMS has not publically issued a statement as to why that section has been omitted or if it is revising that section. But if purposefully omitted, that signals CMS’ uncertainty about what claims would actually be considered in the program.

CMS did, however, retain the section about the “full review” process. That section states there could be between 800 and 11,000 LMSAs/NFMSAs annually “depending upon industry response.” Apparently, CMS still plans on obtaining industry input, but has yet to hold its town hall call on the topic. The wide range of estimated cases also highlights the uncertainty of this issue. If CMS does seek industry input—and if that input steers CMS toward 800 cases a year—then the industry will hardly notice this LMSA/NFMSA program, and it will likely have little impact on claims management.

It is possible that CMS accidently omitted the section about the 40,000 annual cases. It is also possible CMS and/or the vying contractors grasped the fundamental differences between workers’ comp claims and liability and no-fault claims and realized the inherent challenges of trying to impose a workers’ comp process across the board and decided to make changes or revisit the drawing board.

The bottom line? We still need to wait and see

There is no real clarity or certainty about this optional LMSA/NFMSA program at the moment–and that needs to be understood in the industry. There are two big considerations: 1) CMS is focusing on an optional program that is meant to include industry input and also make room for potentially wide volume ranges of actual cases and 2) any forward movement is contingent on the WCRC designing a program that first needs to be selected by CMS. In light of this continued uncertainty, we are still in “watch and wait” mode for new LMSA/NFMSA developments. ISO Claims Partners is closely monitoring CMS and industry communications and communicating to our customers everything we uncover. We’ll continue to watch this issue and provide accurate guidance.


Kendell Gracey

Kendell Gracey is the assistant vice president of liability claims for ISO Claims Partners. In this role, Kendell is responsible for all aspects of liability claims, including sales, strategic initiatives, client engagement, product development, and operations. He’s been working in the Medicare compliance industry for more than eight years and has authored numerous national articles on Medicare compliance, including a piece in Best’s Review. Kendell received his Juris Doctor from the University of Denver and can be reached at Kendell.Gracey@verisk.com.