ElderLaw News — The Estate Planning & Elder Law Firm, P.C. — MD, VA, DC
ElderLaw News

ElderLaw News is a weekly e-newsletter that brings you reports of legal developments and other trends of vital interest to seniors and their advocates. This newsletter is brought to you by The Estate Planning & Elder Law Firm, P.C., William S. Fralin, Esq., President.

CMS Provides First Guidance for Liability Medicare Set-Asides

The Centers for Medicare and Medicaid Services (CMS) recently issued its first memorandum directly addressing the use of a Medicare Set Aside ("MSA") in third-party liability cases.

Previously, the only guidance available to attorneys was that CMS's interests must be taken into account when settling third-party liability cases. This memorandum provides the first information about how CMS's interests must be considered.

Under the Medicare Secondary Payer Act, Medicare makes conditional payment for medical expenses for beneficiaries, with the understanding that Medicare will be paid when the beneficiary receives payment from a third-party. Medicare is opposed to any settlement that results in a contrived shift to Medicare of the responsibilities for a claimant's future medical care. In settling claims, the only guidance that CMS has published to date is that Medicare's interest must be considered. One solution to the problem of burden shifting and properly considering CMS's interests is to establish an MSA.

The September 29, 2011, memorandum makes it clear that when a Medicare beneficiary's treating physician certifies in writing that treatment for the injury related to the personal injury settlement has been completed as of the date of the settlement, and that future medical treatment or services will not be required, then Medicare considers its interests satisfied. Personal injury settlements are defined as liability insurance settlements, judgments, awards, or other payments. The memorandum also makes clear that when such certification occurs, there is no need for the certification or a proposed MSA to be submitted to CMS for its review. CMS also indicates that it will not provide the settling parties with confirmation that Medicare's interests have been considered.

This CMS memorandum is important and extremely useful not just because of its content, but also because it is an indication that CMS is beginning the process of addressing some of the many questions that exist for parties settling third-party liability cases. We will keep our news readers informed on any additional guidance from CMS in this developing area. The CMS alert can be found at: http://www.cms.gov/COBGeneralInformation/Downloads/FutureMedicals.pdf

There are many considerations that need to be addressed prior to or at the time of a personal injury settlement or judgment. These may include medical insurance, eligibility for medical and non-medical public benefits, income and estate taxes, estate planning, guardianship, conservatorship, structured settlement advice, investment advice, special needs trusts, support or settlement preservation trusts, Medicare set-aside arrangements, and qualified settlement funds.

The Estate Planning & Elder Law Firm can assist clients with their estate, financial, insurance, long-term care, veterans' benefits, and special needs planning issues.


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The Estate Planning & Elder Law Firm, P.C. is an elder law firm. We represent older persons, disabled persons, their families, and their advocates. The practice of elder law includes estate planning, estate and trust administration, powers of attorney, advance medical directives, titling of assets and designations of beneficiaries, guardianships, conservatorships, and public entitlements such as Medicaid, Medicare, Social Security, and SSI, disability planning, income tax planning and preparation, care management, and fiduciary services. For more information about The Estate Planning & Elder Law Firm, P.C., please visit our website at http://www.chroniccareadvocacy.com.

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