CMS Updates WCMSA Reference Guide and NGHP Section 111 Reporting User Guide

By: Brendon De Souza, Esq., CMSP

Associate Attorney, Sanderson Firm PLLC

Just yesterday, the Centers for Medicare & Medicaid Services (CMS) published an updated WCMSA Reference Guide (version 3.4) as well as an updated NGHP User Guide (version 6.5). This blog will discuss notable changes to each of these policy materials.

WCMSA Reference Guide (version 3.4)

CMS provided the following description of changes for the updated WCMSA Reference Guide:

Version 3.4 of this guide includes the following changes:

To help ensure that funding information is provided for the WCMSA amount as part of a settlement agreement, clarification language has been added to several conditional letters (see Section 10.5 and the Approval and Development sample letters in Appendix 5). To align with updates to the MyMedicare.gov site, all references to MyMedicare.gov have been changed to Medicare.gov (Section 17.7).

Most notably, the updated policy guidance removes the explicit requirement that a final executed workers’ compensation settlement agreement cite the “approved WCMSA amount.” Instead, the policy guidance now states that the settlement agreement must provide WCMSA “funding information.”

Section 10.5 of the WCMSA Reference Guide previously included the following paragraph (old language is italicized):

The parties can proceed with the settlement of the medical expenses portion of a WC claim before CMS actually reviews the proposed WCMSA and determines an amount that adequately protects Medicare's interests. However, approval of the WCMSA is not effective until a copy of the final executed WC settlement agreement, which must include the approved WCMSA amount, is received by CMS.

Section 10.5 of the new WCMSA Reference Guide now provides the following updated language (updated language is bolded):

The parties can proceed with the settlement of the medical expenses portion of a WC claim before CMS actually reviews the proposed WCMSA and determines an amount that adequately protects Medicare's interests. However, approval of the WCMSA is not effective until a copy of the final executed WC settlement agreement, which must include the funding information for the WCMSA amount, is received by CMS.

Similarly, CMS’ Approval and Development letters will now include the following language:

Approval Letter:

Approval of this WCMSA amount is not effective until the Centers for Medicare & Medicaid Services (CMS) receive a copy of the final executed workers’ compensation settlement agreement, which must include the funding information for this WCMSA amount.

Development Letter:

Final WC Settlement Agreement – Approval of the WCMSA amount is not final until CMS receives an executed copy of the final settlement agreement that has been approved and signed by all parties, and must include the funding information for the approved WCMSA amount.

Both of these letters previously stated that approval of the WCMSA amount was not effective until CMS received final settlement documents which noted the CMS-approved WCMSA amount.

Sanderson Firm Commentary on WCMSA Reference Guide Update:

This update to the WCMSA Reference Guide provides a practical clarification for parties attempting to settle the future medical component of a workers’ compensation claim with an MSA that will be approved by CMS post-settlement. Though not recommended, it is not uncommon for primary payers to enter into a final settlement agreement prior to receiving CMS’ final determination amount. In these instances, primary payers may have agreed to either a) fund CMS’ future (and undetermined) final WCMSA-approved amount once it is confirmed, or b) continue to fund the employee’s claim-related medical care until no further medical care is required. In these “open-option” instances, it was impossible for settling parties to cite the CMS-approved WCMSA amount because a determination had not yet been made by CMS. The updated guidance clarifies this contradiction.

NGHP User Guide (version 6.5)

Updates were provided to Chapter II: Registration Procedures, Chapter III: Policy Guidance, Chapter IV: Technical Information, and Chapter V: Appendices.

Chapter II: Registration Procedures Updates

This Chapter previously noted incoming changes in anticipation of the PAID Act’s December 11, 2021 implementation date (please see our prior blog, here). The following statement has been added to Chapter II:

To support [the PAID Act], Direct Data Entry (DDE) reporters can now use the Beneficiary Lookup function on the Section 111 Coordination of Benefits Secure Website (COBSW).

Chapter III: Policy Guidance

CMS added the following bullet point to Section 6.5.1:

· In cases where exposure has ended prior to December 5, 1980, and there is not yet a settlement, judgment, award, or other payment, it would be inappropriate, and counter to the MMSEA Section 111 reporting obligations, to report such a claim.

Chapter IV: Technical Information

CMS added the following update to this Chapter:

CMS now accepts records with MSP dates up to 3 months in the future; these records will no longer be held and submitted when the beneficiary’s eligibility comes into effect (Chapter 7).

Because the TN30 error no longer causes input records to be rejected, descriptions of the TIN Reference Response File process have been updated (Section 6.3.3)

To support the PAID Act, the beneficiary lookup function has been extended to DDE reporters (Chapter 3, Sections 8.5 and 10.5)

Chapter V: Appendices

CMS added the following update to this Chapter:

CMS now accepts records with MSP dates up to 3 months in the future; these records will no longer be held and submitted when the beneficiary’s eligibility comes into effect (Appendix C).

The ICD-10 diagnosis codes for Excluded All Types and No-Fault Plan Insurance Type D have been updated for FY 2022 (Appendix I and Appendix J).

Because several input errors no longer cause the input records to be rejected, the descriptions for Applied Error Codes and TIN Error Codes have been updated (Appendix C, Appendix D).

For this release, the HEW Translation table (Table K-1) has been updated for clarification (Appendix K), and the HEW Query Input file layout has been corrected (Appendix E).

Sanderson Firm Commentary on NGHP User Guide:

One of the most significant updates, as mentioned in a prior blog, allows Responsible Reporting Entities (RREs) to report Section 111 data for an individual if that individual’s query response file reflects that they will become a Medicare beneficiary within three (3) months.

The DDE reporting update is also significant. For one, it allows DDE users (“small reporters,” or RREs submitting 500 or fewer claim reports per year) to have functionality with the new PAID Act protocol. Thus DDE users now have access to Medicare Advantage (Part C) and Prescription Drug Plan (Part D) enrollment information in the query response file. Secondly, it demonstrates that CMS intends to stick to its stated timeline on PAID Act changes. Thus, we should expect that come December 11, 2021, that CMS will timely implement the PAID Act for standard Section 111 users/RREs.

Finally, it is worth noting the absence of an update regarding mandatory threshold reporting guidelines for 2022. The current threshold for reporting liability, no-fault, and workers’ compensation settlement is $750.00 (last updated November 25, 2020), and CMS is required to publish an annual threshold pursuant to Section 202 of the Strengthening Medicare and Repaying Taxpayers (SMART) Act of 2012. Thus, we anticipate CMS publishing the 2022 threshold before year’s end and an update on the threshold to be issued with another updated NGHP User Guide likely next month in November.

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