Medicare is our nation's healthcare program which guarantees health insurance to Americans age 65 or older, or who are receiving social security disability benefits, as long as the American paid into the Medicare system through their employment. Medicare is what is known as a "Secondary Payer." In other words, Medicare does not pay for health care services that are primarily the responsibilty of another payer. For instance, Medicare does not pay for anything that was paid, or should have been paid for, by a workers' compensation carrier or employer. Medicare also doesn't pay for services that should be covered by an automobile accident insurer. However, Medicare may make "conditional payments" in such cases. This means that Medicare will pay for services that they don't normally pay for if the reponsible party doesn't pay timely and on the condition that Medicare is reimbursed out of any settlement or judgment that the injured person receives.
Extra care must be taken to consider Medicare in any workers' compensation settlement. Every settlement, regardless of the circumstances, should take Medicare's interest into consideration if there is any possibility that any future medical care might be needed for the work injury. This is because the federal law prevents shifting of financial responsibilities from the workers' compensation carrier to Medicare, so that the Medicare fund is adequately protected for Americans as they age and need the program.
How does one "consider Medicare's interest" in a workers' compensation case? If an injured worker is already on Medicare, then Medicare should be put on notice of a workers' compensation claim as soon as possible, and Medicare should be reimbursed for any bills they mistakenly may have paid on account of the work injury out of any settlement. As far as future medical care is concerned, the best method that is recommended by the folks at Medicare is to prepare a Workers' Compensation Medicare Set Aside Arrangement (WCMSA) if future medical care is anticipated. A WCMSA is a financial arrangement where the parties allocate a portion of a workers' compensation settlement to future medical needs. A separate account is established where the money must be placed, and the funds must be depleted before Medicare will pay for any medical expenses incurred after the settlement that are related to the work injury. In limited circumstances, Medicare will review a proposed WCMSA and determine whether the parties have adequately considered Medicare's interest, and will either approve the arrangement or suggest an alternate arrangement. However, Medicare will not review the proposed set aside unless the settlement is $25,000 or more (if the injured worker is already on Medicare), or if the person has a reasonable expectation of being on Medicare within 30 months and the settlement is at least $250,000.00. (Note: the law is constantly changing in this area, but this information is valid as of June 19, 2014).
Workers can jeopardize their future Medicare entitlement if they do not adequately consider Medicare's interest in their settlements. As a result, if you are an injured worker who anticipates filing for Social Security Disability, has filed for Social Security Disability, is getting Social Security Disability, or if you are age 62 or older, you are advised not to settle your workers compensation case without at least talking to a lawyer about how to adequately protect Medicare's interest in the settlement.
