What Should You Tell Your Client About a Medicare Set-Aside (MSA)?

Medicare set-aside (MSA) accounts can seem hopelessly and needlessly complicated. Even seasoned legal professionals can find themselves at a loss, especially when they have to discuss MSAs with their clients. For more information on what you should tell your client about an MSA, please read on, then contact our team today.

Why is it important that your client understands his or her MSA?

If your client is on Medicare or will soon be entitled to Medicare, you, as his or her attorney, will always need to consider Medicare’s interests during settlement. That does not necessarily mean that you will need to submit a Medicare set-aside account for review, but you will need to educate your client regarding his or her duties to Medicare. Otherwise, both you and your client may face liability from Medicare.

When should you start to explain an MSA to your client?

It is best to begin discussions about Medicare’s interests at the time you first start settlement discussions with your client. You should explain to them that Medicare’s interest must be protected with regard to past and future payment of medical expenses related to the work injury. Past payments are protected by satisfying the Medicare lien at the time of settlement, which is usually taken care of by the workers’ compensation insurance carrier. Future payments require greater consideration. Often the tool used to protect Medicare’s future interests is a Medicare Set-aside Allocation. In many cases, MSAs meet the review thresh holds and are submitted to the Centers for Medicare and Medicaid (CMS) for approval. An amount is then required to be set-aside in a separate account and spent on treatment for the work injury before Medicare will begin paying bills for injury-related care. When clients understand from the beginning of settlement talks that a portion of funds need to be allocated for future medical costs, they are more likely to accept and follow Medicare’s rules. The worst case scenario is for clients to believe that the entire settlement is available for living expenses, only to find out at the last minute that a portion of the settlement funds may only be spent according to the strict rules CMS has imposed on MSA Accounts.

What happens if you do not properly explain a Medicare set-aside to your client?

If Medicare denies your client coverage in the future because of a settlement you procured for him or her, he or she will probably circle back to you as the plaintiff’s attorney and ask you why you did not inform him or her about the need to set some of the money aside to pay for future injury-related care.

If your client is not properly spending his or her Medicare set-aside funds or not reporting properly, he or she is jeopardizing their future Medicare benefits for injury-related care. Medicare is actively denying payments for treatments if it can’t track the proper use and exhaustion of the Medicare set-aside funds.

What should you do if you can’t make your client understand his or her duties to Medicare?

If you are not sure how to handle a client’s settlement in relation to his or her Medicare benefits, give us a call. We can:

  • Guide you through the rules and review thresh holds for MSAs
  • Help you think through what is the best situation for each client
  • Protect your client’s Medicare eligibility
  • Protect your firm from liabilities, and
  • Make sure you and your client have a plan in place that fits your client’s needs