Medicare to implement new Medicare Secondary Payer (MSP) coding process on July 6, 2009

Medicare Set-Aside Blog on July 2, 2009
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news/Bad news



its continued efforts to reduce the amount of conditional payments expended
annually on cases in which Medicare is secondary to Workers’ Compensation,  Medicare is set to implement a new MSP code
next Monday,  July 6th.  This code will be used in Medicare’s claims
processing system to specifically identify cases on which the Centers for
Medicare and Medicaid Services (CMS) have reviewed a Workers’ Compensation
Medicare Set-Aside (WCMSA) arrangement. 
With the advent of this new code, CMS will now have the capability to
deny payments that are related to the diagnosis(es) coded in any given WCMSA
arrangement.  All physicians, providers,
and suppliers who bill Medicare contractors (including carriers, DME
contractors, regional home health intermediaries, and Part A/B Medicare
administrative contractors) will be subject to this new coding procedure.  As such, proper coding of the diagnosis(es)
in every WCMSA arrangement submitted to CMS is now even more critical.  There is no discussion within this new
implementation process regarding application of this new MSP code to MSA
arrangements on liability or no-fault cases.


good news for Workers’ Compensation insurance professionals is this:   there should begin to be a decrease in the
amount of conditional payments made on your Workers’ Compensation claims.   On the other hand, the bad news for Medicare
beneficiaries is that they will need to be even more vigilant in administering
their WCMSA accounts post-settlement. 
Medicare will be sending notices of denial directly to beneficiaries for
claims received that appear to be related to WCMSA diagnosis(es) advising them
that “Your claim has been denied by Medicare because you may have funds
set aside from your settlement to pay for your future medical expenses and
prescription drug treatment related to your injury(ies).”


additional point to ponder….How will this new MSP coding procedure, which will
identify cases on which CMS has reviewed a WCMSA,  intersect with the Mandatory Insurer
Reporting requirements which will identify for Medicare all Medicare
beneficiaries who have received a settlement, judgment, or award?  The days of evading or avoiding MSP issues
are quickly coming to an end!


more information, please see




Set-Aside Allocation/Arrangement Recommendations

to Centers for Medicare and Medicaid Services


Benefit Management