Will it be a Happy CMS New Year?

By Robert Lewis December 7, 2015

In the last five years, we’ve seen a lot of challenges for primary payers in the Medicare Secondary Payer (MSP) compliance arena. However, 2015 stands out for having produced more MSP changes than we’ve seen in recent memory. Here’s a quick recap of some of the major changes—many of which occurred in just the last six months of 2015:

- Primary Payer Appeals Process. The SMART Act required the Centers for Medicare and Medicaid Services (CMS) to offer an appeals process to the claims-paying community. In April, the appeals process went live. Now insurers and self-insured debtors are able to use the same appeals process as Medicare beneficiaries. Companies are advised to read the correspondence from Medicare and make the imposed deadlines.

- The Commercial Repayment Center (CRC) takeover of conditional payment recoveries. In July 2015, CMS announced the transition of a portion of conditional payment recovery to the CRC. The CRC, which launched on October 5, recovers payment when a primary payer (and not the Medicare beneficiary) is classified as the debtor. What’s noteworthy about the CRC is that it will recover in Ongoing Responsibility for Medicals (ORM) situations. Medicare has always said that it can recover whenever a primary payer “demonstrates responsibility” for payment, but now it’s happening.

- ICD-10 Transition. The long awaited transition from ICD-9 codes to ICD-10 codes finally occurred on October 1. Responsible reporting entities (RREs) have the option to report claims to CMS in either ICD-9 or ICD-10 codes, provided that the date of incident is prior to October 1, 2015. For any injuries that are occurring now (on or after October 1, 2015) at least one valid ICD-10 code will need to be used.

Issues to watch for in the New Year

Around January 1, CMS will implement another SMART Act change. The conditional payment web portal will be modified to allow authorized individuals and entities to obtain a final demand nearly concurrent with a settlement. If properly implemented, this could solve a big pain point for beneficiaries and insurers alike and make it far more efficient to resolve conditional payments post-settlement. In conjunction with the CRC transition, Medicare also announced that on January 1, it would act as a more assertive benefit coordination regime.

Our 2016 CMS wish list

In 2016, we’d like CMS to modify their ORM termination policy. Right now, a Responsible Reporting Entity’s (RRE) decision to administratively close a claim usually isn’t enough to allow the RRE to notify Medicare that its responsibility to pay for medicals has ended. In some cases, for instance in lifetime PIP states like Michigan, an RRE will have to query and report on long-dormant cases. Now that Medicare is imposing a regime of recovery in ORM situations, we hope it acknowledges that its ORM termination policy is far too restrictive.

We’d also like CMS to take a hard look at the way its workers' compensation review contractor deals with prescription medications, particularly opioids. One positive trend in 2015 has been the recognition of the national problem of opioid dependency. Knowing the depth of this very real problem, we remain troubled that the review contractor of CMS is quick to authorize and recommend a lifetime supply of opioid medication in a Medicare set-aside (MSA). While workers' compensation insurers and companies like ISO Claims Partners often look for ways to address this problem outside of the CMS review process, the fact of the matter is that we wouldn’t have to do so if the CMS review program took a more reasonable approach to reviewing MSA allocations. Our wish list includes Medicare modifying this stance next year.

We’re looking forward to 2016, and we remain dedicated to keeping you informed on MSP compliance modifications, process changes, and any important legal updates. On behalf of ISO Claims Partners, we wish you a wonderful holiday season and a Happy New Year.


Rob Lewis

Robert Lewis is president of ISO Claims Partners, a leading provider of compliance services for many of the world’s largest insurers, third-party administrators, and Fortune 1000 companies. His primary focus is on strategic initiatives and product innovations.