Untangling the confusion of Accident & Health policies

By Kate Riordan May 9, 2016

Medicare compliance often requires that different policy types be grouped together into one set of claims. It’s the practice of the Centers for Medicare & Medicaid Services (CMS) to pigeonhole non-group health plans (NGHP) into either workers' compensation, liability, or no-fault. But what if an insurance policy’s type is unclear? A great example of this is Accident & Health (A&H).

On the surface, Medicare’s approach is simple. The Section 111 User Guide states “Accident & Health, Short Term Travel and Occupational Accident Products are considered no-fault insurance by CMS and reportable as such under Section 111.” According to Medicare’s policy, if an insurer has an A&H claim with a Medicare beneficiary, that insurer should pay for the claimant’s medical treatment.

However, A&H can mean different things to different insurers. These products can include summer camp policies, medical event policies, and policies that pay a lump sum if a catastrophic condition develops, among others.

Medicare’s oversimplification of A&H can leave insurers in a bind. Following Medicare’s guidance could mean that all sorts of claims generically categorized as “Accident & Health” get reported as no-fault insurance. This can happen even when the components of the policy are clearly meant to be Accident & Health. What’s an insurer to do in this situation?

Medicare Secondary Payer (MSP) regulations define no-fault insurance as “insurance that pays for medical expenses for injuries sustained on the property or premises of the insured, or in the use, occupancy, or operation of an automobile.” (See 42 CFR 411.50.) It’s noteworthy that no-fault insurance pays for medical expenses and for expenses “sustained on the property or premises of the insured.”

Some policies sold under the broad umbrella of “A&H” never pay for medical expenses. If medical expenses aren’t paid, the insurer may classify the policy as A&H, but the MSP would not necessarily classify the policy as no-fault. An example of this would be a policy that acts more like life insurance. A policy may be sold as A&H if it pays individuals a sum because an event occurred during a defined time period; however, that policy should not be categorized as no-fault.

Medicare’s A&H policy also implicitly takes an expansive view of the concept of “property or premises” of the insured. Examples of A&H claims often cited by Medicare include policies that pay for injuries sustained while traveling, at summer camp, or while participating in an event. None of those places is “property or premises” of the insured. They’re simply locations where a person will be at a particular time.
These policies can be very challenging to align with Medicare’s terms. Here are some considerations: Should you report ongoing responsibility to pay for a person’s medical treatment when the insurance policy doesn’t even involve medical coverage? Should you collect information to determine whether children involved in accidents at summer camp are Medicare beneficiaries?

ISO Claims Partners examines the terms of the policy and checks them against the CMS guidance in the Section 111 NGHP User Guide. When weighing the competing policies, we examine the purpose, scope, and time frame of the coverage at hand. These questions need time, expertise, and, most important, experience. ISO Claims Partners’ experts will work with insurers both to evaluate your own A&H compliance needs and provide guidance. We’ll then work with you to develop a procedure to evaluate your current A&H Section 111 reporting protocols.


Kate Riordan

Kate Riordan is the director of Medicare Secondary Payer (MSP) initiatives at ISO Claims Partners. She has well over five years of experience in completing Medicare Set-Asides and obtaining CMS approvals, with a concentration in California claims. Kate graduated Bowdoin College and Suffolk University Law School and is a Medicare Set-Aside Certified Consultant.