Civil Monetary Penalty Proposed Regulations Are Here

By on February 14, 2020
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The Medicare Secondary Payer law rendering a potential $1,000 per day penalty for noncompliance against primary payers has finally been demystified to some extent. The proposed regulation issuing guidance about Medicare Secondary Payer Civil Monetary Penalties relative to Section 111 reporting was unofficially disseminated on February 13, 2020, and the full text can be found here. The official document is scheduled to be published in the Federal Register on 2/18/2020 and available online at https://federalregister.gov/d/2020-03069.

By way of history, this rule has been in progress since 2013, pursuant to the Strengthening Medicare and Repaying Taxpayers Act (SMART Act) of 2012, which amended the Medicare, Medicaid and SCHIP Extension Act of 2007. The 2007 law rocked the industry by calling for mandatory penalties against NGHP primary payers of $1,000 per day per claimant for failure to properly report Section 111 data to Medicare. The SMART Act softened this, making the penalty discretionary rather than mandatory. The details of what would constitute a full penalty, diminished penalty and/or safe harbor from Civil Monetary Penalties have not been promulgated by the Agency until now. As of this date, no penalties have been assessed against NGHP primary payers. Having a rule in place could change this.

With 44 pages in all, there is a great deal of content within the proposed rule, the highlights of which are summarized below. As always, the Gordon & Rees Medicare Compliance Group will issue an Official Comment to this proposed rule. We will accept client feedback regarding this rule, through April 15, 2020, as Official Comments which must be received no later than 60 days from the date of official publication.

If more information is needed and/or you have questions about how this may impact your business please contact us at Section111 Reporting Section111Reporting@grsm.com.

Highlights:

• The regulation outlines proposed specific criteria for when CMPs would not be imposed, in circumstances when a NGHP entity fails to comply (either on its own or through a reporting agent) with Section 111 reporting guidelines.
• CMPs will be levied in addition to any MSP conditional payment reimbursement obligations.
• The rule is prospective and CMS will evaluate compliance based only upon files submitted by the RRE on or after the effective date of the final rule.
• There will be a formal appeal process for RREs if they disagree with the CMPs assessed against them.

CMS generally identified three categories of CMPs:

  • Failure to report
  • Submitting responses to recovery efforts contradicting reporting
  • Submitting records with errors that exceed CMS’s error tolerance threshold
    Statute of Limitations:
  • CMS may only impose a CMP within 5 years from the date when the non-compliance was identified by CMS. The regulation outlines specifically how this will be calculated for each of the three proposed types of CMPs.
    • If an RRE fails to report within the required timeframe (no more than 1 year from the TPOC date), the penalty would be calculated on a daily basis, based on the actual number of individual beneficiaries’ records that the entity submitted untimely.
    TPOC Reporting:
  • Penalty would be up to $1,000 (as adjusted annually for inflation based on 42 CFR part 102) for each calendar day of noncompliance for each individual, as counted from the day after the last day of the RRE’s assigned reporting window where the information should have been submitted, through the day that CMS received the information, up to a maximum penalty of $365K per individual per year.
    ORM Reporting:
  • If an RRE fails to report an ORM termination date, the penalty would be calculated based on the number of calendar days that the entity failed to report updates to the record. The penalty would be up to $1,000 (as adjusted annually for inflation) per calendar day of noncompliance for each individual, for a max annual penalty of $365K per year.
  • Please note, while most of the penalties listed are prospective, the ORM termination reporting is retroactive if not terminated properly.
    CMPs Will be Imposed for the Following Errors:
  • If the RRE exceeds any error tolerance(s) threshold in any 4 out of 8 consecutive reporting periods.
  • The initial and maximum error tolerance threshold would be 20% (representing errors that prevent 20% or more of the beneficiary records from being processed).
  • CMS intends for this tolerance to be applied as an absolute percentage of the records submitted in a given reporting cycle.
  • CMS will maintain current notification process where RREs receive notice via response file and direct outreach (email and, in more serious cases, telephone calls) when there are errors with their file submissions.
  • An RRE is out of compliance for the entire reporting period when the RRE exceeds the error tolerance threshold. (90 calendar days equals one reporting quarter)
  • CMS is proposing a maximum 20 percent per file submission error tolerance. The errors that would be used to determine whether the error tolerance is met shall be defined by CMS 6 months prior to imposition of any CMPs.
  • CMPs would be imposed on a tiered approach if the RRE exceeded the error tolerance(s) in the entity’s fourth above-tolerance submission. Penalties and calculation percentages are outlined in detail within the regulation; however, we have included the chart below directly from the regulation that summarizes the tiered penalty approach CMS is proposing. For a more detailed discussion of this, please reference the proposed regulation itself.
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• No CMP will be imposed in the following circumstances where all applicable conditions are met:

  1. If you report a claim timely; and
  2. Comply with TPOC reporting thresholds and any other reporting exclusions; and
  3. Don’t exceed any error tolerances in any 4 out of 8 consecutive reporting periods; and
  4. If the RRE fails to report required information because they were unable to obtain the necessary information from the beneficiary following a good faith effort to obtain this information which is defined in the regulation as communicating the need for the information twice by mail and at least once by phone or electronic communication. The RRE should maintain these records for a period of 5 years.

Disclaimer: Please note, this article is intended to be a high-level summary of the proposed regulation and is not intended to be an exhaustive review of every detail and requirement contained within the text of the proposed regulation. We will be providing a Webinar Series to discuss the fine details, business implications and best practices surrounding Section 111 Mandatory Insurer Reporting for NGHPs.

Let us know if you want to schedule a meeting to discuss in detail how this rule impacts your business.

Filed under CMS, Legislation, Medicare, Medicare Secondary Payer, Medicare Set Aside, Section 111 Tagged with , ,

Long Awaited Regulations Pushed Back, Again

By on November 22, 2019
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Rulemaking for Civil Monetary Penalties and regulations believed to promulgate formality to Liability and No-Fault Medicare Set-Asides has been pushed back to December 2019 and February 2020, respectively.

Rules clarifying when and how penalties may be issued for Section 111 Medicare Mandatory Insurer Reporting noncompliance could possibly be issued by year’s end. The industry has been anticipating this rule since the initial $1,000 per day per claim penalty was softened into a discretionary penalty per the SMART Act of 2012, enacted in 2013. The updated notice can be viewed here.

Rulemaking for an LMSA or NFMSA policy no longer appears to be imminent. The last date published was October of 2019, which is now delayed another three months, at least. CMS approached such policymaking in 2012, redacting it in 2014 only to revisit it again in 2016. The industry remains in a holding pattern, which will continue through the first several months of 2020, if not longer. https://www.reginfo.gov/public/do/eAgendaViewRule?pubId=201910&RIN=0938-AT85

The Office of Information and Regulatory Affairs’ (OIRA) Office of Management and Budget (OMB) page shows some changes to the Miscellaneous Medicare Secondary Payer Clarifications and Updates proposed rule. Of note is the priority for this rule, which has been shifted from Economically Significant to Other Significant.

According to the OIRA/OMB Frequently Asked Questions, page, a proposed rule that is Economically Significant can be defined as follows:

“A regulatory action is determined to be “economically significant” if OIRA determines that it is likely to have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities. For all “economically significant” regulations, the Executive Order directs agencies to provide (among other things) a more detailed assessment of the likely benefits and costs of the regulatory action, including a quantification of those effects, as well as a similar analysis of potentially effective and reasonably feasible alternatives.”

The term “Significant” is also defined on the OIRA page, and it can be distinguished from Economically Significant status as the proposed rule could:

  • Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;
  • Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or
  • Raise novel legal or policy issues arising out of legal mandates, the President’s priorities, or the principles set forth in this Executive order.

The OIRA page further distinguishes “Significant” status as follows:

The Executive Order requires that significant regulatory actions be reviewed by OIRA before they are published in the Federal Register or otherwise issued to the public. The Executive Order also requires agencies to provide an explanation of the need for the regulatory action and an assessment of potential costs and benefits. OIRA generally designates between 500-700 regulatory actions as significant each year.

Of interest is the bit about the proposed rule raising novel legal or policy issues arising out of legal mandates. Of further interest is the removal of some of the abstract language on the OIRA agenda page, which removes the following part of the rule’s description,

“Currently, Medicare does not provide its beneficiaries with guidance to help them make choices regarding their future medical care expenses when they receive automobile and liability insurance (including self-insurance), no fault insurance, and workers’ compensation settlements, judgments, awards, or payments, and need to satisfy their Medicare Secondary Payer (MSP) obligations.”

This leaves only the following description of the rule in the Abstract: “This proposed rule would ensure that beneficiaries are making the best healthcare choices possible by providing them and their representatives with the opportunity to select an option for meeting future medical obligations that fits their individual circumstances, while also protecting the Medicare Trust Fund.” Essentially, Medicare is no longer indicating that the Beneficiaries do not have guidance about future medical. This could possibly correlate to the prior Medicare Learning Network publications the Agency had disseminated to medical providers, suppliers and facilities. These publications suggested that Medicare Beneficiaries could be billed directly for services if Section 111 reporting was filed, demonstrating a primary payment plan’s availability, with Medicare as a Secondary Payer. The removal of language that there has been no guidance by Medicare could indicate positioning for greater accountability about Medicare Set-Aside usage. This is consistent with recent changes in the Workers’ Compensation Medicare Set-Aside Reference Guide (WCMSA) Version 3.0, which requires a Beneficiary’s acknowledgement of MSA content, intent, submission processes and associated administration within the Consent Form, as of April 1, 2020. See our article on this here.

What has not changed in the Abstract is Medicare’s suggestion that any proposed rule will be voluntary in nature, although the change to “Significant” status broaches the possibility that there could be a policy concern or legal mandate involved.

GRSM’s Medicare Compliance Group will continue to monitor the status of any forthcoming rulemaking.

Filed under CMS, Legislation, Medicare, Medicare Secondary Payer, Medicare Set Aside

WCMSA REFERENCE GUIDE 3.0 EMPHASIZES ADMINISTRATION

By on October 30, 2019
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Several changes regarding administration details have been made in Version 3.0. The biggest changes include new Consent Form language for WCMSA submissions requiring the Beneficiary acknowledge his or her understanding of administration, references to Medicare Part D coverage guidelines for Frequently Abused Drugs, and a link for professional administrators to upload account transactions and view account details. Also, among these significant changes are the extension of Amended Review timeframes and hospital fee clarifications.

It must be the end of October, as the Medicare Secondary Payer industry is seeing new program changes, with plenty more in sight. Today the Centers for Medicare and Medicaid Services disseminated the updated Workers’ Compensation Medicare Set-Aside (WCMSA) Reference Guide version 3.0, dated October 10, 2019. The 3.0 Reference Guide is geared toward greater emphasis on Medicare Set-Aside administration, from several different fronts. Proper administration of CMS-approved Medicare Set-Asides ensures the preservation of post-account exhaustion Medicare entitlements. So is this emphasis on administration a warning signal of Medicare benefit jeopardization and/or increased vigilance in monitoring accounts on Medicare’s part?

CONSENT FORMS

In Section 10.2, Consent to Release Note, Version 3.0 adds the following language:

“As of April 1, 2020, all consent-to-release notes must include language indicating that the beneficiary reviewed the submission package and understands the WCMSA intent, submission process, and associated administration. This section of the consent form must include at least the beneficiary’s initials to indicate their validation.”

It has been independently confirmed by CMS that current Consent Forms do not require this content prior to April 1, 2020. Figure 10-2: Example Consent to Release with Instructions, illustrates the location of the initial line and provides the necessary language to pass muster with CMS. Such language brings to mind the Medicare Learning Network literature of the last several years, which directed medical providers, suppliers and facilities to direct bill Beneficiaries with Medicare Set-Aside accounts, so that Medicare would not be billed when a case reached settlement, judgment, award or other payment. Including this new language in the Consent Form documents the Beneficiary’s awareness of, and agreement with, a Medicare Set-Aside and its content, as well as the intent, process and administration of an MSA, all prior to submission. While Beneficiaries and their attorneys have always had access to the contents of a submitted Medicare Set-Aside and supporting documentation, this adds a new layer of accountability for the Beneficiary in the Medicare Set-Aside process.

FREQUENTLY ABUSED DRUGS

Version 3.0 includes a new provision in Section 17.1 Administrators, which explains account administration. New language states, “CMS highly recommends professional administration where a claimant is taking controlled substances that CMS determines are ‘frequently abused drugs’ according to CMS’ Part D Drug Utilization Review (DUR) policy. That policy and supporting information are available on the web at:
https://cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/RxUtilization.html

Further, Section 17.3 Use of the Account, also includes new language reinforcing the latter provision: “CMS expects that WCMSA funds be competently administered in accordance with all Medicare coverage guidelines, including but not limited to CMS’ Part D Drug Utilization Review (DUR) policy. As a result, all WCMSA administration programs should institute Drug Management Programs (DMPs) (as described at: https://www.gpo.gov/fdsys/pkg/FR-2018-04-16/pdf/2018-07179.pdf) for claimants at risk for abuse or misuse of ‘frequently abused drugs’.”

This aspect of the Reference Guide reflects Medicare’s new prescription drug policy that had started January 1, 2019 in which Part D plan sponsors could adopt drug management programs concerning beneficiary use of frequently abused drugs in an effort to combat opioid overuse as per the Comprehensive Addiction and Recovery Act (CARA).

ADMINISTRATION LINKS

In Version 2.9, Beneficiaries could review all documents submitted to CMS via http://www.mymedicare.gov. A physical address for also existed for beneficiaries or their representatives to mail exhaustion documentation. Version 3.0 maintains this option in item 17.7, but adds to Section 17.6 Electronic Attestation, options for electronic submissions of annual and final attestations, usable for either self-administered or professionally administered accounts respectively:

For more information about how to submit an attestation electronically, please see the WCMSAP User Guide, at https://www.cob.cms.hhs.gov/WCMSA/assets/wcmsa/userManual/WCMSAUserManual.pdf.

For more information on Professional Administrator accounts, please see the WCMSAP User Guide, at https://www.cob.cms.hhs.gov/WCMSA/assets/wcmsa/userManual/WCMSAUserManual.pdf.

The new links come on the heels of other CMS efforts concerning MSA account administration. On October 17, 2019, disseminated CMS updated its Self-Administration Toolkit for WCMSAs to Version 1.3, dated October 10, 2019, the same date as Version 3.0 of the WCMSA Reference Guide. The Toolkit Version 1.3 can be found here: https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/Workers-Compensation-Medicare-Set-Aside-Arrangements/Downloads/Self-Administration-Toolkit-for-WCMSAs-Version-1_3.pdf

Additionally, Medicare disseminated information about two new webinars focused on WCMSA Electronic Attestation Enhancements. The first was to be held today for Medicare Beneficiaries and their representatives. https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/Workers-Compensation-Medicare-Set-Aside-Arrangements/Downloads/WCMSA-Electronic-Attestation-Enhancement-Webinar-October-30-2019.pdf

The second is to be held November 6, 2019 and is for professional administrators. https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/Workers-Compensation-Medicare-Set-Aside-Arrangements/Downloads/WCMSA-Electronic-Attestation-Enhancement-for-Professional-Administrators-Webinar-November-6-2019.pdf

AMENDED REVIEW TIMEFRAME EXTENDED

In its own new Section 16.2 Amended Review, Medicare pushes the timeframe in which an Amended Review will be considered from 12-48 months from the date of the original approval letter to 12-72 months from the original approval. This is a welcome expansion to the workload threshold as many cases more than four years past the original approval date have still not settled. Additional language in Section 16.2 fleshes out details surrounding some of the parameters for Amended Review. With regard to a change in treatment, the new version states that changes in treatment plans won’t be considered without supporting medical documentation. Also, Version 3.0 offers a link for details on electronic submission:

See the WCMSAP User Guide at: https://www.cob.cms.hhs.gov/WCMSA/assets/wcmsa/userManual/WCMSAUserManual. Pdf

HOSPITAL FEE SCHEDULES

The new Reference Guide offers much-needed specificity to the sources of hospital pricing for surgical procedures. In the previous version, Reference Guide 2.9 stated within Section 9.4.3 WCRC Review Considerations, “Currently the WCRC prices WCMSAs according to the correct region for the state of venue. Hospital fee schedules are currently determined using the Diagnosis-Related Groups (DRG) payment for a Major Medical Center within the state, and this fee is applied to all locations within the state.” Changes to this Section in the 3.0 version are that the hospital fee schedules are determined using DRG payments for the “median” Major Medical Center within the “appropriate fee jurisdiction for the ZIP code, unless otherwise identified by state law.” (Emphasis added).

ADDITIONAL CHANGES:

• Section 2.2 Reporting a WC Case now includes an address change to:

Medicare – Medicare Secondary Payer
Medicare Secondary Payer Claims Investigation Project
P.O. Box 138897
Oklahoma City, OK 73113-8897

• Section 17.5 Annual Attestation and Record-Keeping has clarified the following address for submitting yearly attestation material:

NGHP
P.O. Box 138832
Oklahoma City, OK 73113

• Section 10.3 Rated Age Information and Life Expectancy has been updated to reflect the most recent life table link:

“CMS will project the cost of the claimant’s future treatment over the claimant’s life expectancy, using the Centers for Disease Control (CDC) Tables. https://www.cdc.gov/nchs/data/nvsr/nvsr68/nvsr68_04-508.pdf

NOT IN THE REFERENCE GUIDE, BUT ON THE HORIZON

• Rulemakings! Civil Monetary Penalties for Section 111 Medicare Mandatory Insurer Reporting have not yet been issued. According to the OIRA office, rulemaking should be issued in October of 2019. Similarly situated is possible rulemaking for Liability and No-Fault Medicare Set-Asides, also slated for this month. Both of these items have been collecting dust for years and were scheduled for action in September, which gave way to October. Will what little remaining of October bring the proposed regulations? Or will these rulemakings be pushed into November or beyond?

• Speaking of November, we are only a few weeks away from the annual announcement of the low dollar recovery threshold. Will this amount increase for 2020?

Future updates regarding Medicare Secondary Payer laws will be monitored by the Gordon & Rees Medicare Compliance Team. Please stay tuned for more information as it becomes available!

Filed under Uncategorized Tagged with ,

Section 111 Mandatory Insurer Civil Monetary Penalties: CMS Announces an Update to the Issue Date for Proposed Rulemaking

By on September 27, 2019
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CMS has recently announced that it has pushed back the proposed rulemaking and public comment solicitation period for assessment of civil monetary penalties for noncompliance with the Section 111 Mandatory Insurer Reporting guidelines to October 2019.

The Medicare Secondary Payer Act (MSPA) provides for civil monetary penalties to be assessed for noncompliance with the Section 111 Mandatory Insurer Reporting requirements. Specifically, 42 USC 1395y(b)(8) provides that a civil monetary penalty (CMP) of $1,000 per day per claim shall be assessed for noncompliance. Subsequently, the SMART Act clarified this provision to indicate that any such penalty shall be discretionary, and penalties of up to $1,000 per day per claim may be assessed for noncompliance. However, prior to assessing any CMPs to a Responsible Reporting Entity, we will first need regulations in place outlining exactly what constitutes noncompliance as well as the criteria for which penalties will and will not be assessed.

CMS has announced its intent to issue a Notice of Proposed Rulemaking in order to propose the criteria for which CMPs will and will not be assessed. The full announcement can be found here. Clarification regarding Section 111 CMPs is something that this industry has been awaiting for quite some time. This announcement extends the original timeline published by CMS on this topic. Earlier this year, a similar announcement indicated that this rulemaking and comment period would open in September 2019. That timeline has now been pushed back one month.

While the date listed for the Notice of Proposed Rulemaking is now October 2019, and it will no doubt take some time before any recovery audits are started and any CMPs are assessed, this notice makes it clear that Section 111 reporting penalties are in the pipeline. With that said, ensuring that your claim data is compliant with the Section 111 requirements can also take a considerable amount of time. We at Gordon & Rees have extensive experience in running Section 111 reporting programs for all types of carriers and self-insured entities, as well as performing full internal audits of Responsible Reporting Entities’ claim data to ensure full compliance with the Section 111 reporting guidelines.

Please keep an eye out in the coming weeks for a comprehensive webinar by the Gordon & Rees Section 111 Reporting team discussing how to get compliant with the Section 111 Mandatory Insurer Reporting requirements, how to perform an internal audit, and the most up-to-date information regarding the coming civil monetary penalties.

Gordon & Rees will continue to monitor all activity regarding Section 111 CMPs as it develops. For any questions or concerns regarding Section 111 reporting penalties or Medicare Secondary Payer compliance in general, please contact us at CMSReporting@grsm.com.

Filed under CMS, Medicare, Medicare Secondary Payer, Medicare Set Aside, Section 111 Tagged with , ,

CMS Issues Updated Section 111 NGHP User Guide Version 5.6

By on July 25, 2019
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On July 1, 2019, CMS issued an updated version of the of the MMSEA Section 111 NGHP User Guide. The latest version of the User Guide provides some much needed clarity as to the submission of multiple claim files per reporting quarter. GRSM has received numerous inquiries regarding the submission of multiple claim input files per quarter, and in light of potential misinformation disseminated by various other Section 111 service providers, these updates come at an opportune time.

CMS did not change the fact that an RRE can submit more than one claim input file per quarter. Rather, Ch. II, Sect. 4.2.2 of the User Guide now states that Responsible Reporting Entities (RREs) should submit one Claim Input file per quarter but also provides in Ch. IV that under appropriate circumstances RREs may submit multiple files within a single quarter. The User Guide specifically states that the primary purpose for multiple submissions in a quarter is to permit RREs to provide ORM termination updates in an expedited manner. An RRE may want to submit more than one claim file per quarter for a number of reasons. For example, in order to trigger a conditional payment notice/letter to aid in the recovery process, an RRE may want to submit an off-cycle claim input file; or to avoid receiving a late flag for timeliness, an RRE may want to submit TPOC or ORM termination information off-cycle.

A full list of the updates made to the latest version of the User Guide is as follows:

– Ch. II of the User Guide added clarity regarding the submission of multiple claim input files. As discussed above, Ch. II Sect. 4.2.2. now states that “RREs should submit one Claim Input file per quarter. Please See CH. IV: Technical Information for more information.” (pg. 4-10).  Whereas this same section previously stated that “File submitters can only submit one Claim Input File on a quarterly basis for each RRE ID.”

– Ch. IV of the User Guide now states that the retention period for downloading response files from the Section 111 site has been updated from 180 days to 60 days (Sect. 10.3 and 10.4).

– RREs can now download the latest PC/server version of the HIPAA Eligibility Wrapper (HEW) software from the Section 111 MRA application, which is compatible with Windows 10. (Sect. 9.3 and 10.4).

– RREs using the HTTPS file transmission method can only upload files with the extension of .txt. Other file types will generate an Invalid Error message (Sect. 9.3 and 10.4). – Finally, Ch. V now provides the same update mentioned above in Ch. IV regarding downloading the HEW software, i.e. RREs can now download the latest PC/server version of the HIPAA Eligibility Wrapper (HEW) software from the Section 111 MRA application.

Version 5.6 of the NCHP Section 111 User Guide can be downloaded here (link https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/Mandatory-Insurer-Reporting-For-Non-Group-Health-Plans/NGHP-User-Guide/NGHP-User-Guide.html).

The GRSM Medicare Compliance Group will continue to follow all trends and updates issued by CMS and provide you with the latest updates. If you would like to discuss these updates, or Section 111 Reporting in general, please contact our Section 111 Reporting team at CMSReporting@grsm.com.

Filed under Medicare, Medicare Secondary Payer, Medicare Set Aside

Gordon Rees Scully Mansukhani Becomes First 50-State Law Firm

By on April 16, 2019
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With 68th office opening, Gordon Rees Scully Mansukhani expands reach, services to every state.

Gordon Rees Scully Mansukhani (GRSM) has opened its 68th office, creating the world’s first 50-state law firm.

Name partner Miles Scully heralded the move as a game-changing moment in the legal services industry. “As the first and only law firm to feature offices in all fifty states, we are poised to meet our clients’ needs whenever or wherever they may arise. Our deep bench of talented lawyers coupled with our forward-thinking use of technology enables us to lead the industry in providing efficient and cost effective representation virtually anywhere in the country.”

Managing partner Dion Cominos added, “With an already established national platform, the firm was well-positioned to take the next step of providing full territorial coverage throughout the United States. This milestone represents both the culmination of our journey toward becoming a truly national firm, and the next chapter in a new era of delivering seamless and comprehensive legal services to clients on a nationwide basis.”

Since its founding 45 years ago in San Francisco, GRSM has strategically expanded across the nation, opening offices in markets critical to its clients. And as the firm’s clients have continued to consolidate, grow in size, and span additional industries, GRSM has grown to match and service their needs – initially on the west coast, and eventually throughout the country. The full list of GRSM’s offices and local contacts can be found here.

The firm’s strong growth was recognized by The American Lawyer in 2018, which named GRSM number 103 in top grossing law firms, moving up seven spots from the previous year. Law360 recognized the firm as the 40th largest in the United States in its annual rankings by domestic attorney headcount. The firm was also recognized among the top 45 for diversity on The American Lawyer Diversity Scorecard.

GRSM is a national litigation and business transactions firm with more than 900 lawyers providing full service representation to public and private companies ranging from the Fortune 500 to start-ups. Founded in 1974, GRSM is recognized among the fastest growing and largest law firms in the country.

Highlights of Resulting Media Coverage:
Bloomberg Law, April 15, 2019
Law360, April 15, 2019 (subscription may be required)

Contacts
Dion N. Cominos
Miles D. Scully

Filed under In the News, Medicare, Medicare Secondary Payer, Medicare Set Aside Tagged with , ,

More Webs in Alabama: District Court Quotes Scott, Dismisses MSPA Claim

By on March 21, 2019
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A recent determination against Infinity Property and Casualty Group emerging from a federal district court in Alabama demonstrates that while so many MSPA private cause of action claims pose similar legal shortcomings, the courts have no shortage of colorful ways to dismiss them.

Quoting the famous words of Sir Walter Scott, the Opinion opens with “Oh! what a tangled web we weave / When first we practice to deceive!” Dismissing with prejudice MSPA Claims I, LLC’s latest efforts, the U.S. District Court for the Northern District of Alabama, Southern Division determined on March 19 that subject matter jurisdiction did not exist, thwarting its attempt to “catch a lucrative class action lawsuit under the Medicare Secondary Payer statue.” MSPA v Infinity Prop & Casualty Group, 2019 U.S. Dist. LEXIS 43620 (2019).

In this case, two separate automobile accidents occurred in which Infinity was the insurance carrier. Medicare beneficiary D.W was enrolled in Part C through Florida Healthcare Plus, Inc. and Medicare beneficiary B.G. was enrolled in Part C through Simply Healthcare Plans, Inc., both of which Plaintiff alleged assigned to it rights under the Medicare Secondary Payer laws to recover medical payments Infinity failed to reimburse.

With regard to D.W., Infinity disputed MSPA’s allegations on the grounds that Infinity had no obligation to pay the FHCP bill of $140.47 as it properly paid all of D.W.’s medical bills with additional medical coverage still available. FHCP assigned its recovery rights to La Ley Recovery Systems in 2014. According to the agreement. La Ley could not assign those rights to a third party without the approval of FHCP’s (or the Florida Department of Financial Services later through receivership).

La Ley attempted to reassign these rights to MSPA in 2015 without approval. While approval was later granted at the time of settlement on June 1, 2016, the court decided the assignments were valid but that FHCP never had standing to bring a claim under the MSP in the first place and FHCP never suffered an injury in fact.

With regard to B.G., the medical coverage with Infinity exhausted. InterAmerican Medical Center Group, LLC served as Simply’s Management Service Organization (MSO). In a tapestry of alleged assignments, Plaintiff claimed Simply contractually assigned recovery rights to InterAmerican, which were in turn assigned to MSP Recovery, LLC, and as “the final strand in its web…” MSP Recovery assigned those rights to Plaintiff.

The Court dismissed the allegations on the grounds that the statute affords recovery rights to MOAs but there is no clear indication that MSOs have these statutory rights.

The Court pointed out “fatal” defects in Plaintiff’s web of assignments, ultimately granting Defendant’s motion for summary judgment due to lack of standing.

Elsewhere on the very same day, the 11th Circuit Court of Appeals was busy exterminating another MSPA private cause of action claim. Somehow on the same page with the Alabama court in both legal and literary senses, the 11th Circuit Court wove the web theme into its dismissal. See MSP Recovery Gets Caught in the Tangled Web of the Medicare Secondary Payer Act.

Given the growing body of dismissals, it should be interesting to see how future courts rule on such actions going forward. To discuss this case or other Medicare Secondary Payer matters, please contact Gordon & Rees Medicare Compliance Group.

Filed under Uncategorized Tagged with , ,

MSP Recovery Gets Caught in the Tangled Web of the Medicare Secondary Payer Act

By on March 21, 2019
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In the recent case of MSPA Claims 1, LLC v. Tenet Fla., Inc. the Eleventh Circuit Court of Appeals affirmed the holding of the district court, dismissing a case for recovery of payments under the private cause of action of the Medicare Secondary Payer Act (MSP Act). While aspects of the MSP Act can be very convoluted and confusing, especially with regard to the private cause of action for recovery of primary payments, the court here begins its opinion by stating “Luckily, we do not need to venture very far into its tangled web here. The provision at issue in this case is clear, and clearly bars plaintiff’s claim.” See MSPA Claims 1, LLC v. Tenet Fla., Inc. 2019 U.S. App. LEXIS 7833.

The court here spends little time examining the makeup and history of the MSP Act; however, reminds us that while the Act has created a private cause of action that permits the government to sue when it is not properly reimbursed by a primary payer, it also provides for a private cause of action for private plaintiffs to recover double damages. The intent of this private cause of action is to encourage private parties to enforce Medicare’s right of recovery against primary payers in the courts. See generally MSPA Claims 1, LLC v. Tenet Fla., Inc. 2019 U.S. App. LEXIS 7833. Various courts have held this private cause of action to extend to Medicare Advantage Organizations (MAOs).

While a detailed rehashing of the facts of this case is not important to understanding the outcome, a brief background will help outline the issue here. In short, one of Florida Healthcare Plus’s (an MAO) enrollees was involved in a car accident and received medical care at St. Mary’s Medical Center. St. Mary’s billed both the enrollee’s primary plan- Allstate, as well as FHCP. FHCP assigned its right of recovery to the Plaintiff in this case MSPA Claims 1, LLC, through a series of assignments. St. Mary’s later reimbursed FHCP in full- $286. However, MSPA Claims brought suit against ST. Mary’s and its parent company Tenet Florida, Inc. for the delayed $286 reimbursement.

The court here determined that FHCP did suffer an injury-in-fact and that MSPA Claims has standing to bring the case and therefore the case was properly in court; however, in order to survive dismissal, the claim must still be plausible. The court reiterates that the MSP Act’s private cause of action is only available in the case in which a primary plan fails to reimburse Medicare, or in this case an MAO. Here, MSPA Claims has sued a medical service provider and not a primary plan. The court reasoned that given the fact that MSPA Claims has not sued a primary plan, its claim is not plausible on its face, and therefore the dismissal based on failure to state a claim issued by the lower court is affirmed.

This dismissal provides another instance of MSP Recovery, LLC getting caught in the tangled web that is the Medicare Secondary Payer Act. The amount in controversy here hints that the purpose of bringing this case was to attempt to gain a favorable decision and to begin to carve a path through the case law to further recovery by MAOs under this provision of the MSP Act. While the private cause of action at issue here is a dangerous one given the double damages provision, this case makes it clear that there is still work to be done in order to weave through this tangled web.

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CMS Finishes New Medicare Card Distribution Initiative

By on January 17, 2019
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The Centers for Medicare & Medicaid Services (CMS) has recently published a press release stating that it has completed its initiative of issuing new Medicare cards to all beneficiaries with new Medicare identification numbers as of January 16, 2019. The purpose of this initiative was to replace all Social Security number based HICNs with the new Medicare ID number, the Medicare Beneficiary Identifier (MBI) which is a randomly generated series of letters and numbers, as opposed to being based on an individual’s Social Security number, in turn adding a layer of security against identity theft and fraud and abuse. Specifically, the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015 requires CMS to remove Social Security Numbers (SSNs) from all Medicare cards and to reissue new non-Social Security number based Medicare identification numbers by April 2019. The issuing of this bulletin indicates that CMS has completed this project of replacing all existing Medicare cards three months ahead of schedule. The full press release can be found here.

CMS states that the current administration is “committed to modernizing Medicare and has expedited this process to ensure the protection of Medicare beneficiaries and taxpayer dollars from the potential for fraud and abuse due to personal information that existed on the old cards.” CMS further asserts that more than half of the healthcare claims that it is now processing now contain an MBI.

CMS has previously outlined that it has exempted all Medicare Secondary Payer (MSP) Processes from exclusive use of MBI for the time being. That is, for Section 111 reporting Responsible Reporting Entities (RREs) may continue to perform Section 111 reporting processes using an individual’s full SSN, HICN, or MBI. The Section 111 User Guide states that if a HICN is reported, and the individual has been assigned an MBI, the MBI will be returned on the response file. Further, CMS has also previously stated that all Benefits Coordination and Recovery Center (BCRC) and Commercial Repayment Center (CRC) issued correspondence will use the most recent Medicare identifier that the RRE has provided when creating or updating a Medicare Secondary Payer record. In short, while the use of the HICN will continue to decrease until only the MBI is in use, CMS will not yet have any issue processing claims using an individual’s HICN (if one was previously issued to the individual).

As increasing personal security was the purpose of replacing the previous Medicare cards, CMS recommends that all beneficiaries destroy their old Medicare cards, begin using the new Medicare card immediately, and to protect your Medicare card just like a credit card. Further, in the event that a Medicare beneficiary has not received his or her new Medicare card, CMS recommends contacting 1-800-Medicare or logging in to the beneficiary’s mymedicare.gov account to ensure that their contact and mailing information is accurate.

Gordon & Rees remains committed to bringing you the most up to date information regarding all things Medicare Secondary Payer. Accordingly, we will continue to provide any updates regarding the use of MBIs as they are released. Should you have any questions regarding the above or need any Medicare compliance assistance, please do not hesitate to contact Gordon & Rees Medicare Compliance Group.

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CMS Issues updated Section 111 NGHP User Guide

By on January 8, 2019
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As of January 4, 2019, CMS has issued an updated version of the MMSEA Section 111 NGHP User Guide. While version 5.5 of the User Guide has few changes, there are some noteworthy additions. The changes made to the latest version of the User Guide are as follows:

– Ch. III of the User Guide now clarifies that beginning January 1, 2019, the threshold for liability insurance settlements, judgments, awards, or other payments will remain at $750. CMS will also maintain the $750 threshold for no-fault insurance and workers’ compensation settlements, where the no-fault insurer or workers’ compensation entity does not otherwise have ongoing responsibly for medicals. This is outlined in Section 6.4 of Ch. III and in short, simply restates the fact that the TPOC dollar thresholds remain at $750 for liability, no-fault, and workers’ compensation insurance.

– The definition of the ‘Funding Delayed Beyond TPOC Start Date 1’ data field has been updated. This definition can be found in line 82 of Table A-3 and states “If funding is determined after the settlement date (TPOC Date), provide actual or estimated date of funding determination.” The previous definition simply stated “If funding for the TPOC Amount is delayed, provide actual or estimated date of funding.” The same verbiage has been added to lines 95, 98, 101, and 104 of Table A-5 Auxiliary Record, updating the definition of this field for all possible additional TPOCs (TPOCs 2 – 5).

– Ch. IV of the User Guide also provides updated versions of the excluded ICD-9 and ICD-10 tables in order to match the excluded lists that are available through the Section 111 MRA application (https://www.cob.cms.hhs.gov/Section111). These tables can be found in Appendices I and J.

– Lastly, version 5.5 of the User Guide has been updated to only include information from the last four User Guide releases in order to reduce the number of version and revision history pages.

Each chapter of the Section 111 NGHP User Guide, version 5.5 can be downloaded here.

Should you have any questions regarding the above or need any Medicare compliance assistance, please do not hesitate to contact Gordon & Rees Medicare Compliance Group.

Filed under CMS, In the News, Medicare Secondary Payer, Medicare Set Aside, Section 111, Uncategorized

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