Workers’ Compensation Settlements With Medicare Set-Aside Arrangements: Problem Solving the Issues

Although enacted in 1980, the Medicare Secondary Payer (MSP) statute has received little attention until recently. This is due in part to the passage of the “Medicare Integrity Program” of 1996. The MSP requires that payment of medical expenses be withheld “to the extent that …payment has been made or can reasonably be expected to be made promptly under a work[ers’] compensation law or plan … or under an automobile or general liability insurance policy or plan or under no fault insurance” (42 USC § 1395y(b)(2)(A)(ii)). On July 23, 2001, the Centers for Medicare and Medicaid Services (CMS), formerly HCFA(Health Care Finance Administration), issued a memorandum that further clarifies CMS policy regarding Medicare and Workers’ Compensation settlements (Patel, 2001).