Medicare Set-Aside: FAQ

What is a Medicare Set Aside Arrangement (MSA) and why is it necessary?

Who must have an MSA?

Where is the money kept and what happens when it is gone?

Who administers the MSA Account?

Besides Workers’ Compensation claims, what other claims require a MSA?

Is a MSA required in a Liability case?

When should Atlas Settlement Group get involved?

What is needed to complete a MSA?

Where should the above information be sent for an MSA evaluation?

How much does it cost to have an MSA done?

How long does it take to get an MSA?

How long does it take to get an MSA approved?

What is the SCHIP Extension Act 2007


What is a Medicare Set Aside Arrangement (MSA) and why is it necessary?
Medicare takes the position of a secondary payer in cases where there is another culpable party, such as an employer and/or its Workers’ Compensation Insurance carrier as set forth in the Medicare Secondary Payer Act 42 U.S.C. §1395y and 42 C.F.R §411:1, et al. The purpose of the Medicare Set-Aside Arrangement (MSA) is to provide funds to the injured worker to pay for future medical expenses that would otherwise be covered by Medicare, otherwise known as “qualified medical expenses”. If the injured worker incurs qualified medical expenses that exhaust the anticipated annual amount, then Medicare will pay for any excess expenses. By establishing a Medicare Set-Aside Account, parties to a settlement are protecting Medicare’s interest and complying with the Medicare Secondary Payer Act.
-back to top-


Who must have an MSA?
A.
If a Claimant is Medicare-eligible(1) at the time of settlement, and the total settlement value is $25,000 or greater.

(1)Medicare eligible is defined as individuals who are sixty-five (65) years of age or older, those who are in receipt of Social Security Disability benefits for a period of twenty-four (24) months or longer, or those suffering from End Stage Renal Disease.

-or-

B. If there is a “reasonable expectation”(2) that the Claimant will be Medicare-eligible within thirty (30) months of settlement, and the total settlement value exceeds $250,000.

(2)Claimants are considered to meet the “reasonable expectation” of future Medicare-eligibility if they are between sixty-two-and-a-half (62.5) years of age and sixty-five (65) years of age, they have applied for Social Security Disability benefits, they have applied for and have been denied Social Security Disability benefits, or they have Renal Disease not yet in the end stage.
-back to top-


Where is the money kept and what happens when it is gone?
The funds for the MSA must be placed into an interest bearing account with distributions made only for medical expenses related to the injury and that would otherwise be covered by Medicare. The account administrator must provide annual accounting records for all disbursements to Centers for Medicare and Medicaid Services (CMS).

Once all funds have been exhausted, a final accounting audit is performed before the injured individual’s Medicare benefits are fully reinstated with no future risk of termination.
-back to top-


Who administers the MSA Account?
A Medicare Set Aside Account can be administered by the injured individual or by a Third Party Administrator (TPA). The account administrator, whether the individual or TPA, must keep accurate accounting records of all disbursements from the account. An annual statement of the disbursements must be provided to CMS for review and appropriateness. If expenditures are deemed outside of Medicare’s coverage, future Medicare coverage can be terminated.

If Third Party Administration is desired, Atlas Settlement Group will assist in setting up a custodial account with the TPA.
-back to top-


Besides Workers’ Compensation claims, what other claims require a MSA?
CMS requires a MSA on matters governed by the Federal Employees’ Compensation Act, the US Longshoremen’s and Harbor Workers’ Compensation Act and the Federal Coal Mine Health and Safety Act of 1969.
-back to top-


Is a MSA required in a Liability case?
CMS does not currently require eligibility evaluations for settlements of liability cases. In the event a claimant is Medicare-eligible and has a claim under the Jones Act, a MSA should be completed to fully protect the interests of all involved parties. Likewise, a Liability MSA is required when settling as a third party liability claim, with an underlying WC claim that triggers the MSA thresholds. This also applies to a Federal Employer’s Liability Act case with an underlying Longshoreman’s action. In some cases, CMS has required a MSA in settlements where Medicare / Social Security Disability eligibility are not in question and the dollar amount for future anticipated medical expenses is large. It is expected that this requirement will affect more liability cases as CMS streamlines the MSA approval process.
-back to top-


When should Atlas Settlement Group get involved?
Atlas Settlement Group is a full service MSA and Structured Settlement Annuity company. It is our belief that early involvement is critical. This allows ample time to review the medical records to determine if the injured individual has a substandard life expectancy (rated age) and time to verify Medicare and/or Social Security Disability eligibility. If the individual meets the eligibility requirements, the completion of an MSA early in the life of the file assists with reserving and settlement negotiations. Further cost savings can be achieved through funding the MSA annual obligation with a Structured Settlement Annuity. Atlas Settlement Group’s Structured Settlement Annuity services are offered at no additional cost to the employer/insurer or the injured individual. Finally, Atlas Settlement Group will assist in preparation of settlement documents to ensure that Medicare’s interests are properly addressed and parties to the claim are properly protected.
-back to top-


What is needed to complete a MSA?
The last two (2) years of treatment records for the injury, the payment detail from the same timeframe along with a completed Medicare Set-Aside Evaluation Referral Form.
-back to top-


Where should the above information be sent for an MSA evaluation?
Please email or fax a completed Medicare Set-Aside Evaluation Referral Form to our office and then mail the medical records and payment history to

Atlas Settlement Group, Inc.
3280 Peachtree Road NE
Suite 2050
Atlanta, GA  30305
-back to top-


How much does it cost to have an MSA done?
Atlas Settlement Group charges on a flat fee schedule to determine if an individual is Medicare and/or Social Security Disability eligible, to prepare a proposed Medicare Set Aside Arrangement and to submit the MSA to CMS for approval. Please contact our office at 888-993-9111 for more detail.
-back to top-


How long does it take to get an MSA?
Atlas Settlement Group knows that time is of the essence. Therefore we are committed to provide proposed Medicare Set Aside Arrangement reports within 10 business days of receipt of the required information.
-back to top-


How long does it take to get an MSA approved?
The approval process for a MSA is performed by the Regional Centers for Medicare and Medicaid Services. Each Regional Center varies in approval time due to volume and complexity, but the average time to receive approval ranges between 60 and 90 days.
-back to top-

What is the SCHIP Extension Act 2007?
On December 29, 2007, President George Bush signed into law the “Medicare Medicaid, and SCHIP Extension Act of 2007 [PDF:132KB]”. The new legislation amends the Medicare Secondary Payer Act (MSPA) by establishing new reporting guidelines. Under the new rules, all liability insurers, no-fault insurers, workers’ compensation insurers and self-insurers will be required to determine whether any individual who files a claim against the insurer or any entity insured or covered by the insurer is entitled to Medicare benefits. If so, the insurer must provide Medicare with that individual’s identity and any other information that may be required by the Secretary of Health and Human Services. This information must be furnished to Medicare within the time specified by the Secretary after the claim is resolved through settlement, judgment, award or other payment (regardless whether or not there has been an admission or determination of liability).

If an insurer fails to notify Medicare in accordance with these guidelines, a civil penalty of $1,000 per day will be charged per claimant. The new legislation clearly indicates a shift in policy which will result in the federal government monitoring general liability claims more closely.

Prior to June 2009, it’s the understanding that the Secretary will issue directives concerning additional information that will be required. Atlas will continue to follow these new guidelines and will advise our clients concerning all new developments in this area.
-back to top-








"Medicare’s demands cause confusion and uncertainty in settling claims. It is important that you entrust a professional company with the job of handling your Medicare needs."





If you are interested in receiving an MSA Illustration unique to your situation, please fill out the following form.



Workers Compensation Info

Phone: (404) 926-4160 | Fax: (404) 926-4161
Home | Site Index | Ethics Statement | Privacy Policy | Terms of Use | ©2005 Atlas Settlement Group