CMS Updates NGHP User Guide in Preparation for Upcoming Mandatory Workers’ Compensation Medicare Set-Aside Reporting

Written by: Neha Pellegrino, Esq., MSPA

On December 6, 2024, the Centers for Medicare & Medicaid Services (“CMS”) published Version 7.8 of the MMSEA Section 111 Medicare Secondary Payer Mandatory Reporting Liability Insurance (including Self-Insurance), No-Fault Insurance, and Workers’ Compensation User Guide (“NGHP User Guide”).

Version 7.8 now adds the following language to Chapter III – Policy Guidance and Chapter IV – Technical Information regarding Workers’ Compensation Medicare Set-Aside (WCMSA) reporting:

A Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) is a portion of the total workers’ compensation settlement or TPOC allocated for future work-injury-related medical expenses that are covered and otherwise reimbursable by Medicare (“Medicare covered”). The amount of a WCMSA may range from $0 to the full value of the reported TPOC.

All future medical expenses related to a workers’ compensation injury that are claimed and released by the workers’ compensation settlement and that are Medicare-covered items and services must be included in the WCMSA.

The amount of the WCMSA may be $0 under certain circumstances, such as when there is no need to fund future medical care because the settlement is only for past medical care. Please refer to Section 4.2 of the WCMSA Reference Guide for more information about where a WCMSA is not necessary.

WCMSA amounts may be approved through CMS’s voluntary WCMSA review process or determined through other means. Regardless of how the amount was determined, the WCMSA funds must be appropriately exhausted before Medicare will resume payment for care related to the underlying injury or illness.

Note: For any settlement reached on or after April 4, 2025, NGHP RREs are required, as part of their Section 111 reporting obligations, to report the amount of any WCMSA created as part of a workers’ compensation settlement.

As our readers are likely already aware, CMS will require Non-Group Health Plan (NGHP) Responsible Reporting Entities (RREs) to report WCMSA information through their Section 111 Total Payment Obligation to the Claimant (TPOC) reporting beginning April 4, 2025. CMS’ Version 7.8 update now simply confirms that submission of WCMSAs remains voluntary, zero-dollar WCMSAs are permissible and must also be reported, and that WCMSA reporting will not become effective until April 4, 2024.

If you have questions regarding CMS’ NGHP User Guide update, Sanderson Firm’s Medicare Set-Aside or Section 111 reporting services, and/or would like to schedule a demo of Sanderson Firm’s reporting solution, SandersonComply, please contact us.