Medicare Advantage Plan Conditional Payments Post PAID-Act: The Advantages, Continuing Challenges, and Recommendations on Limiting Double Damages Exposure
Written by Brendon De Souza, Esq., CMSP & Stacy Piazza, CMSP
As of January 17, 2023, more than thirty (30) million Americans are enrolled in Medicare Advantage Plans (MAPs) according to data published by the Centers for Medicare & Medicaid Services (CMS). Moreover, there are nearly four (4) thousand MAPs available nationwide—3,998 to be exact—which is nearly double the amount of available plans dating back to 2010.
MAPs (commonly referred to as Medicare Part C) are health plans offered by private companies approved by Medicare. MAPs often cover items and services that are not covered by Original Medicare (commonly referred to as Medicare Parts A and B) such as vision and dental benefits. Medicare Prescription Drug Plans (commonly referred to as Medicare Part D) are also offered by private companies and specifically cover prescription drugs. MAPs and Prescription Drug Plans, as private entities, seek their own recovery for unpaid conditional payment debts, and primary insurance plans must resolve conditional payment matters with these entities (or their subrogation vendors) directly. By contrast, all Original Medicare conditional payment matters are handled by the Benefits Coordination & Recovery Center (BCRC) and the Commercial Repayment Center (CRC).
The recent explosive growth in MAP enrollment continues to present a daunting challenge to primary insurance plans (liability, no-fault, and workers’ compensation insurance carriers as well as self-insured entities) with respect to Medicare Secondary Payer (MSP) compliance. Prior to December of 2021, one of the most difficult challenges was identifying whether a MAP had an interest in a Medicare beneficiary’s claim. The Provide Accurate Information Directly (PAID) Act sought to remedy this issue, and it has proved useful in bridging an enormous information gap. However, even more than a year after the PAID Act became effective in December of 2021, challenges with identifying MAP enrollees and MAP conditional payment concerns remain.
As many readers are aware, the PAID Act requires CMS to provide Responsible Reporting Entities (“RREs,” also commonly referred to as “primary insurance plans”) with the name, address, and plan name of each MAP and Prescription Drug Plan that a Medicare beneficiary was enrolled in within the last three (3) years of the Section 111 query date. The PAID Act has been incredibly beneficial for MSP stakeholders, but primary insurance plans still struggle to effectively resolve MAP conditional payment lien exposure. Receiving MAP information is helpful; however, working with MAP plans and/or their subrogation vendors through the conditional payment resolution process is an entirely different animal that has presented its own unique set of challenges.
One very important point to remember is that the PAID Act, in and of itself, does not require RREs to utilize the MAP data to resolve conditional payments. Additionally, CMS did not provide any requirements to the stakeholder community on the usage of PAID Act information, nor did it provide any documentation to the MAP community of how MAPs should handle recovery efforts. CMS maintains the position that MAP conditional payments and processes are outside of their purview which is over traditional Medicare conditional payments.
It has been widely speculated and insinuated that MAPs should, by and large, follow the same recovery processes as traditional Medicare; however, theory and practice do not always align. Additionally, there is no one governing entity, like CMS, to issue policies that apply to all private MAPs. Thus, MAP recovery can at times mirror the “Wild, Wild, West” as MAP plans may all behave differently in their conditional payment recovery processes. With nearly 4,000 MAPs across the country, this is no easy feat to tackle.
Several challenges that remain and new challenges that we have identified include:
1. Plan Numbers: The PAID Act does not contain Plan Numbers. Some MAPs or their subrogation partners have trouble locating beneficiary records with demographics other than the Plan Number. This has proved to slow down requests for liens and, often, beneficiaries do not even know their Plan numbers if it is not the current plan.
2. Contact Information: The Contact Directory provided by Medicare is helpful, but numerous inaccuracies have been noted; these inaccuracies have resulted in time-consuming efforts to determine what entity handles the subrogation for the MAP.
3. Mergers & Acquisitions: Many companies have been bought or sold and Plan Names (especially for older plans) may not be accurate. There can be a maze of rabbit holes that one has to navigate to find the newly named carrier along with what entity, if any, handles their subrogation.
4. Authorization: Authorization Form requirements may vary. Some MAPs and their subrogation vendors will accept a Letter of Authority consistent with Medicare’s process. Some will not process a request until a HIPAA Authorization form has been provided, and some require their own specific HIPAA Authorization form to release information. This can be a tedious and time-consuming process and varies plan to plan and subrogation company to subrogation company.
5. Turnaround Times: The PAID Act has no doubt caused an influx of requests as the Carrier community by and large is a compliant one and many organizations have adopted proactive MAP lien investigations; however, this influx has most certainly caused delays in response times which can be critical when dealing with potentially time sensitive settlements.
6. Data Discrepancies: We have found some discrepancies in CMS data vs. Plan data we are receiving from subrogation companies. Third-party subrogation companies often work for multiple carriers, and we have seen instances where a lien for a Plan was provided which did not match the initial request.
7. Aggressive Stance on Post-Settlement Recovery Rights: We have seen MAPs be more aggressive at pursuing recovery from the Carrier post settlement despite the presence of language in the settlement that the beneficiary is responsible. This is in contrast to traditional Medicare’s standard operating recovery procedures post-settlement. While we know that Medicare plans reserve the right to re-direct recovery as well post settlement for unpaid liens, we traditionally have not seen this in practice. Will MAPs more aggressively pursue their recovery rights if not reimbursed post-settlement? We have been told verbally the answer is “yes.”
In spite of the challenges presented, we always recommend that primary insurance plans seek to insulate themselves, to the greatest extent possible by proactively identifying MAP/Part D plans and drafting robust settlement agreement language as it pertains to MAPs and Part D Plans recovery. This may come in the form of indemnification, defense, hold harmless, and/or waiver of the private cause of action (42 U.S.C. §1395y(b)(3)(A)) language.
Ultimately, despite the existence and implementation of the PAID Act, there is currently no fool-proof solution for primary insurance plans to identify and resolve ALL MAP recovery interests prior to settlement; however, progress is being made. We urge our clients and potential clients as always to take a proactive approach, and ensure their Medicare compliance partner has the expertise to mitigate the potential MAP/Part D exposures that may exist.
Our firm offers comprehensive services and guidance for determining MAP Plan involvement, research and resolution of any potential MAP recovery, and we also provide customized settlement agreement language to better protect our clients against future potential MAP exposure. To learn more about our MAP or settlement agreement services, please contact us.
Do you want to learn more about MAPs and conditional payments? Join us for a webinar! On April 19, 2023 at 1:30 PM EST, please join Heather Schwartz Sanderson, Esq., and special guest speaker Brian Bargender, CSRP to learn about what you need to know now about MAP conditional payment recoveries. Brian is currently employed as a Senior Subrogation Professional at one of the largest MAPs in the country, and his insight will be invaluable.
