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CMS has once again pushed back the start of reporting of settlements with Medicare beneficiaries by insurers.  It was set to start on 1/1/11.  It has now been pushed back to 1/1/12.  The delay only applies to total payment obligations to the claimant (TPOC) which refers to the dollar amount of a settlement, judgment, award or other payment in addition to/apart from ongoing responsibility for medicals (ORM).  ORM refers to an insurer’s responsibility to pay, on an ongoing basis for the Medicare beneficiary’s medicals.  ORM cases must still be reported.

Bottom line is that most liability settlements are TPOCs and now will not have to be reported until 1/1/11.  No fault insurance claims, workers compensation claims and ORM claims will have to report on 1/1/11 still because they involve ongoing payment of medicals (ORM). 

As I have said before, this has nothing at all to do with Medicare Set Asides.  This is only related to the insurer’s responsibility to report settlements to Medicare when there is a settlement with a current Medicare beneficiary. 

The AAJ issued the following statement to its members:

“Dear AAJ Member:

As all of you are aware, the Centers for Medicare & Medicaid Services’ (CMS) implementation of the Section 111 reporting requirements of the Medicare Secondary Payer Act (MSP) for liability settlements and the penalties associated with improper lien resolution has created turmoil and delay for anyone trying to reach a settlement in any liability case.

After several months of working with the Department of Health and Human Services (HHS) and CMS, we are pleased to inform you that today CMS is announcing a one year delay in implementation on Section 111 reporting requirements for claims involving liability insurance, retroactive to October 1, 2010 through October 1, 2011. This delay should facilitate settlements and allow for faster resolution of certain cases. In addition, we believe that during this period, CMS will suspend the issuance of MSP guidance documents, which have often been contradictory and a source of confusion.

We will continue to work with both CMS and HHS during this period to reevaluate and clarify their Medicare Secondary Payer requirements.  Further, we understand that CMS will not require data that is not reported during the time period of the moratorium to be reported anytime in the future.

We understand that this will not resolve all of your issues with the Medicare Secondary Payer Act. AAJ will continue to work on resolving all Medicare Secondary Payer issues; in particular, we will focus on the issues surrounding finality and the lengthy period of time it often takes to resolve a lien with CMS. AAJ Public Affairs will continue to keep you apprised of any changes regarding this issue.”