By: Heather Sanderson, Chief Legal Officer, Franco Signor
As required by section 202 of The SMART Act, CMS is required to annually review its costs relating to recovering conditional payments as compared to recovery amounts. For the past three (3) years, the liability TPOC threshold has been maintained at settlements of $1000 or less. CMS has announced via alert that the TPOC threshold for liability claims will remain $1000 for the rest of 2016.
CMS has also additionally now released a TPOC threshold for workers’ compensation settlements of $750 or less, wherein the settlement would not need to be reported and conditional payments would not need to be reimbursed. However, this TPOC reporting threshold only impacts claims wherein the no-fault insurer or workers’ compensation entity does not have ongoing responsibility for medicals (ORM), otherwise the claim would still be reportable under ORM reporting requirements.
The CMS alert can be found here. For more information on how CMS calculated these threshold amounts, click here.
Franco Signor Commentary: CMS has indicated that both thresholds are only in place through the rest of 2016, as we are heading into October. Additionally, from a reporting aspect, the workers’ compensation and no-fault threshold will impact very few claims as most of these claims have ongoing responsibility for medical. However, the more obvious benefit is that no recovery for conditional payments should be pursued on these claims following settlement. Notwithstanding, never ignore a letter from CMS even if it involves a below-threshold claim. Always respond with appropriate defenses to avoid potential problematic Treasury claims.
We have confirmed the CMS will issue another alert specific to NGHP Mandatory Insurer Reporting that will include specific details relating to claim reporting thresholds. We will provide another update once that Alert is posted.
The foregoing was originally published on the Franco Signor Blog and is reproduced here with permission of the author. No further republication is permitted without the author’s consent.