Questions surrounding MMSEA Section 111 Reporting

Medicare Set-Aside Blog on March 25, 2009 | Posted by

                      

 

We’ve recently received several
questions with regard to issues surrounding MMSEA from various parties in the
Medicare Set-Aside industry.  Following
is a snapshot of two of these inquiries:

 

Are umbrella or excess carriers who reimburse their insureds for claims
paid considered Responsible Reporting Entities (RREs)? 
 In their Non Group Health Plan (NGHP) User
Guide as well as in the course of discussion in Town Hall Meetings, CMS has
defined RREs as those entities who make payments to claimants directly.  Those entities who reimburse other entities
for claims paid and do not make payments to claimants directly are not
considered RREs by CMS for purposes of MMSEA reporting.

 

If a primary liability insurer settles with a bankrupt insured and pays
funds into a bankruptcy trust for later payments to claimants, who is the RRE
in this situation, the liability insurer or the bankruptcy trust
At this time, CMS continues to defer their official
response on this issue.  As such, the
NGHP User Guide does not specifically address the issue of bankruptcy; however,
the Interim Record Layout dated 12/05/2008 (published by CMS on their website)
does discuss this issue.  In this
document, CMS stated that it was considering whether special provisions must be
made for an RRE in bankruptcy.   Since
the issuance of the Interim Record, the issue has been raised on every Town
Hall Meeting conducted by CMS and they have indicated that direction on this
issue is forthcoming.

 

For insight into CMS’ possible handling of this issue, one should
consider how the NGHP User Guide addresses self-insurance pools/joint powers
authority on page 19 where they state: 
If the pool is 1) a separate legal entity with 2) full responsibility to
resolve and pay claims using pool funds  
3) without involvement of the participating entity, then the
self-insurance pool is the RRE.   If all
three of these factors apply to a bankruptcy trust, then one could draw the
conclusion that it could be identified as an RRE by CMS when they issue their
final position in this regard.

 

For more information or to view the two documents discussed
above, please visit CMS’ website at

www.cms.hhs.gov/MandatoryInsRep
.  Contact us at askjen@medval.com .   

 

  

 

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