Key Takeaways from CMS’ Second Workers’ Compensation Medicare Set-Aside Reporting Webinar

Last November, the Centers for Medicare & Medicaid Services (CMS) hosted its first webinar announcing the expansion of Section 111 Total Payment Obligation to Claimant (TPOC) reporting to include Workers’ Compensation Medicare Set-Aside (WCMSA) information. Most recently, CMS published a technical alert confirming that such reporting will become mandatory for Non-Group Health Plan (NGHP) Responsible Reporting Entities (RREs) on April 4, 2025.

Here are the key takeaways from today’s second WCMSA webinar:

1.      NGHP RREs will be required to report WCMSA information for all workers’ compensation settlements involving Medicare beneficiaries, regardless of the total settlement amount, whether the Medicare Set-Aside was voluntarily submitted and reviewed by CMS, or whether the Medicare Set-Aside was a non-submit / evidence-based allocation.

2.      Submission of a WCMSA to CMS for review, even if the $25,000 (for Medicare beneficiary settlements) / $250,000 (for reasonable expectation of becoming a Medicare beneficiary settlements) submission thresholds are met, remains entirely voluntary.

3.      When reporting WCMSA information via TPOC, entering an incorrect value for certain fields (e.g., MSA Amount, MSA Period, Lump Sum vs. Annuity Indicator, Annuity Anniversary Deposit Date, and Case Control Number) will result in a hard error causing CMS to reject the TPOC record. In the event such an error occurs and the NGHP RRE fails to timely correct and re-report the TPOC record, the NGHP RRE will be exposed to civil money penalties due to late reporting.

Example: NGHP RRE reports an MSA Amount as “Seven Thousand” rather than “7,000.00.” Because “Seven Thousand” does not contain valid numerical values, CMS will automatically reject this TPOC record. If the NGHP RRE fails to correct and re-report the TPOC record within one (1) year of the settlement date, civil money penalties may be imposed against the NGHP RRE.

4.      An NGHP RRE that knowingly reports false WCMSA information through TPOC reporting will face enforcement actions from CMS, which may include False Claims Act (31 U.S.C. §§ 3729 – 3733) litigation.

Sanderson Firm Commentary

As a reminder, there is no current requirement for NGHP RREs to report WCMSA information through TPOC reporting. The upcoming WCMSA reporting requirement does not become effective until April 4, 2025.

That said, today’s webinar confirms CMS’ intent to ensure that all reported WCMSA information is as accurate as possible for coordination of benefit purposes. CMS could have made all of the WCMSA reporting fields non-mandatory or soft-error fields, but instead CMS has made such fields mandatory with the majority of misreporting resulting in hard error codes. CMS also noted that it may exercise legal remedies (e.g., litigation) for instances where NGHP RREs are non-complaint with WCMSA reporting. All of these observations send a clear message that NGHP RREs must ensure that WCMSA information is properly and timely reported as there is both litigation and civil money penalty exposure for non-compliance.

We strongly encourage NGHP RREs to take advantage of the WCMSA testing period and to contact your assigned EDI representatives with any technical concerns. WCMSA testing will begin on October 7, 2024. Sanderson Firm’s reporting solution, SandersonComply, has already been configured for proper reporting of WCMSA information and is available for all NGHP RREs. If you or your organization has questions about the upcoming WCMSA reporting requirement or would like to learn more about how Sanderson Firm’s Section 111 reporting solution will benefit your organization, please contact us.