Key Takeaways from Yesterday's CMS’ “Section 111 Reporting” Webinar

Yesterday, December 6, 2022, the Centers for Medicare and Medicaid Services (CMS) hosted a Section 111 Non-Group Health Plan (NGHP) Reporting Webinar.

As you may recall from one of our prior blogs, CMS hosted this webinar to provide Responsible Reporting Entities (RREs) with tips, best practices, and reminders for appropriately reporting settlements, judgement, awards, or other payments involving Medicare beneficiary claimants. During the webinar, CMS discussed, among other topics, the definition of TPOC (Total Payment Obligation to Claimant), indemnity-only settlements, settlements involving deceased beneficiaries, resolving reporting errors, proper ICD diagnosis code reporting, and procedures for an RRE changing reporting agents.

Here are some of the key takeaways from yesterday’s webinar:

·        Of the top 10 error codes CMS tracked from July 1, 2022 to October 7, 2022, the top 3 RRE error codes were: 1) CR12 Rep Phone, SP49 No Aux Occur for Delete, and CI05 Diagnosis Code 1.

o  CR12 Rep Phone – Telephone number of the representative. If the injured claimant has a representative, the RRE is required to populate this field. If the telephone number is not entered correctly, this error will appear and the RRE must correct the error on their next quarterly file submission.

o  SP49 No Aux Occur for Delete – Delete failed. This may occur when the RRE is attempting to delete a record for which the prior record was already deleted (Example: the Medicare beneficiary calls Medicare and has their record deleted, and then the RRE attempts to delete the record via Section 111 reporting).

o  CI05 Diagnosis Code 1 – Invalid ICD code. This will occur where the RRE inserts an invalid ICD code, likely due to spacing, decimal point, or other input issues. 

·        Indemnity-only and property-damage-only claims are not reportable.

o  Assuming medicals are not claimed and/or released or the settlement, judgment, award or other payment does not have the effect of releasing medicals, the indemnity or property-damage settlement is not reportable.

o  Example: Sue settles her case for $10,000 in lost-wages (indemnity). Sue’s settlement for medicals is pending. Sue’s $10,000 settlement is not reported as a TPOC.

o  CMS further stated that the above holds true even if the settlements occur on the same day (i.e., if Sue settles indemnity separately via Settlement Agreement 1 on Date X and Sue also settles medicals via Settlement Agreement 2 on Date X, the indemnity settlement would not be reported as a TPOC, but the medicals settlement must be reported as a TPOC).

o  If a settlement only involves indemnity or property damage, the settling parties should ensure that the final release agreement language does not stipulate that medicals are claimed and/or released. Otherwise, the settlement will be subject to mandatory reporting obligations and Medicare may seek recovery.

·        CMS does not share TPOC information with Medicare Advantage Plans (Medicare Part C). CMS does, however, share Ongoing Responsibility for Medicals (ORM) and Worker’s Compensation Medicare Set-Aside (WCMSA) information with Medicare Advantage Plans.

o  This confirms why Medicare Advantage Plans have a difficult time making conditional payment recoveries. However, we recommend that RREs take full advantage of the Provide Accurate Information Directly (PAID) Act (which provides Medicare Part C & D enrollment information to RREs) by proactively communicating with Medicare Advantage Plans if a potential conditional payment interest is uncovered through the query process.

·        CMS will publish its annual reporting threshold in the next few weeks

o  CMS is required to publish an annual low dollar threshold amount in accordance with Section 202 of the Strengthening Medicare and Repaying Taxpayers (SMART) Act of 2012. The current threshold is $750.00, which means that RREs are not required to report (and CMS will not seek recovery) on settlements below $750.00.

o  The current $750.00 threshold has remained in place since 2017.

Commentary: As anticipated, CMS remained silent regarding a publishing date for the proposed rule on Section 111 reporting penalties. That said, yesterday’s webinar will help RRE’s gear-up for the final rulemaking scheduled to be released within the next several months.

Sanderson Firm currently serves as a Recovery Agent to various entities/RREs, and we also perform Section 111 reporting and auditing services for claims organizations. Sanderson Firm also provides settlement agreement drafting and review services, and we may provide counsel regarding appropriate settlement language for indemnity-only and property-damage-only settlements. If you have questions regarding yesterday’s webinar, or are interested in our Recovery Agent, Section 111 reporting and auditing, or settlement agreement services, please contact us at referrals@sandersoncomp.com.