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Workers Compensation MSA Claims Monitoring – Threshold Key

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Monitoring Workers Compensation MSA Claims

I received a question about how to monitor workers compensation MSA claims for Workers Comp. Please check the last post for the definition of a Medical Set Aside or MSA claim. The best way to monitor the MSA – sometimes called WCMSA is to examine the thresholds.

Vector Graphic Of Hand Carrying Heart MSA Claims With HeartBeat
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The thresholds are:

  • The claimant is currently a Medicare beneficiary and the total settlement amount is greater than $25,000; OR
  • The claimant has a “reasonable expectation” of Medicare enrollment within 30 months of the settlement date and the anticipated total settlement amount for future medical expenses and disability/lost wages over the life or duration of the settlement agreement is expected to be greater than $250,000.

Whether your company has a traditional Workers Comp insurance policy or is self insured makes no difference on the monitoring of a possible WCMSA claim.

The first bullet point above is clear. If the injured employee is a Medicare beneficiary and the total settlement is $25,000 or greater, then your company has to have the settlement approved by the CMS.

Stack Of US Currency MSA Claims Picture
123RF

The second bullet can be complicated. Our clients and companies that have contacted us have been confused about the term reasonable expectation that the employee will apply for Medicare within 30 months. The other area that is confusing is $250,000 level of future medical or lifetime medical.

The carrier or TPA is responsible to initiate the approval if they consider the claim to be a possible WCMSA. However the ultimate responsibility falls on the employer as is the case with most business insurance policies.

The simplest way is to request at policy renewal that all settlements of $25,000 or above have to be approved by you, the employer in writing. In fact, we advise most of our clients to make sure that all settlements of $10,000 or more have to be agreed to in writing by a designated person at the employer. Emails count as an approval.

This cuts down on any premium surprises at renewal and also allows the employer to be an additional checkpoint to make sure that the WCMSA Federal Laws have been satisfied.

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James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications

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