When settling workers’ compensation or liability claims, I find that many people use the term “MSA” or “Medicare Set-Aside” as a catch-all term for the process of identifying future medical expenses. Typically, the question asked is “Do we need an MSA?” The implication is – if an MSA isn’t required, we needn’t do anything, at all. This isn’t necessarily correct.
There is one basic requirement when we’re settling our claims, and it isn’t providing an MSA. It’s determining whether the claimant is a Medicare Beneficiary, or whether they have a reasonable expectation of becoming a Medicare Beneficiary within 30 months and, if so, doing what is reasonably necessary to prevent Medicare from becoming the primary payer for claim related treatment. An MSA is one method of satisfying that requirement but, it isn’t the only method.
Many settlements don’t require allocating any portion of the funds to future medical treatment. Some require simply identifying and memorializing, in the settlement agreement, the portion of the funds allocated to future medicals, with an explanation of how you got to that number (its reasonable relationship to what is going on in the claim, for the allowed conditions, at this snapshot in time). Some require a more sophisticated method of determining future medicals, such as a professionally produced MSA evaluation, because the case is complex.
Before you decide whether to obtain an MSA, you need to determine whether it is the best way to accomplish the task at hand. If you utilize an MSA evaluation, it should probably be the mid-way point. It isn’t the end of the process because consideration must be given to whether there are medical or legal bases or opportunities to mitigate costs. This thought process is fact specific to your claim and claimant. Your MSP professional can help you with these determinations.
Because professional MSAs can be expensive (especially when “guaranteed”), they should be implemented only when it will provide the benefit you need, under the circumstance. Be wary of those who recommend, in all circumstances, professional MSAs or submission for approval.
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