November 2010

Medicare Set Asides and the COBC

What is the purpose of Coordination of Benefits Contractor (COBC)? They are there to help identify the health benefits available to a Medicare beneficiary and to coordinate the payment process to prevent mistaken payment of Medicare benefits. All parties including the Attorneys, Adjusters, and Third Party Payers such as Administrators and Clients have the responsibility to ensure the COBC is notified of situations where medical services rendered to a beneficiary are related to a Workers Compensation or Liability Insurance incident. In turn, a Medicare Set Aside should be considered under the Medicare Secondary Payer (MSP) laws.

Why Are Rated Ages Obtained?

Rated Ages are obtained in Liability and Workers Compensation claims for claimants with pre-existing medical conditions such as obesity, diabetes, and cardiac problems, or from incident-related issues affecting life expectancy. If Rated Ages are required in your cases, they must always be obtained from an independent entity and submitted on their letterhead. They must also include a certification stating "Our organization certifies that all rated ages we have obtained and/or have knowledge of regarding this claimant, and generated at any time on or after the date of incident for the alleged accident/illness/injury/incident at issue, have been included as part of this submission of a proposed amount for a (Type of Medicare Set-Aside)." For more information on this subject, please click below for the most current Centers for Medicare and Medicaid Services (CMS) advice.

Why is a Conditional Payment Letter Sent?

The letter is sent in response to a request for Medicare's Conditional Payment amount. The dollar amount reflected in the letter is Medicare's interest in the case. When negotiating a settlement, it should be kept in mind that Medicare needs to be reimbursed out of the settlement proceeds. Continuous follow-up with the Medicare Secondary Payer Recovery Contractor (MSPRC) is mandatory in order to determine if the Conditional Payment Amount has increased. Lien negotiations can be beneficial to minimize any un-related charges. Then when the case does actual settle, forward settlement information to the Medicare Secondary Payer Recovery Contractor (MSPRC). Protect yourself, and call us if you need any assistance.