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A threshold question before engaging in a Medicare Set Aside analysis is are we dealing with a Medicare beneficiary.  If the answer is we are not, then the next question is whether the injury victim is “reasonably likely” to become a Medicare beneficiary within 30 months.  If the answer to both those questions are no, then there is no need to go further.  If the injury victim is not a current Medicare beneficiary and will not be one within 30 months, there isn’t a need to do a Medicare Set Aside analysis to address MSP concerns.  If it were otherwise, every single injury victim would need an MSA as we all will eventually qualify for Medicare based on age. 

The way an injury victim gets Medicare prior to retirement age is through Social Security Disability (SSDI).  When one applies for SSDI and is accepted, there is a 5 month elimination period and then the first check is paid in the 6^th month.  Thereafter, they automatically get Medicare in 24 months.  This is where the reasonably likely within 30 months standard comes from.  If an injury victim has applied for and been accepted as disabled by Social Security, they will have Medicare coverage within 30 months.

If you are dealing with a case involving a Medicare beneficiary or someone reasonably likely to be one within 30 months, the question is when don’t you have to do a Medicare Set Aside.  The only guidance we have comes from the policies set forth in the CMS memoranda for Workers Compensation Medicare Set Asides.  According to CMS, an MSA is not necessary if ALL of the following criteria are met:

(1) The facts of the case demonstrate that the injured individual is only being compensated for past medical expenses (i.e., for services furnished prior to the settlement);

(2) There is no evidence that the individual is attempting to maximize the other aspects of the settlement (e.g., the lost wages and disability portions of the settlement) to Medicare's detriment; and,

(3) The individual's treating physicians conclude (in writing) that to a reasonable degree of medical certainty the individual will no longer require any Medicare-covered treatments related to the WC injury.

If a settlement is for past medical expenses only and the treating physician concludes that there will be no future Medicare covered care related to the injury, then an MSA analysis isn’t necessary.  However, that scenario is a bit unusual.  Most cases involve future medical, but if you can meet the criteria above then an MSA analysis is unnecessary.