Medicare and Workers' Compensation: Essential Insights
Navigating workers' comp and Medicare can be a tangled web, but it's essential to untangle it to avoid future headaches. Here's a lowdown on how workers' comp settlements can impact your Medicare coverage.
Insurance for job-related injuries or illnesses, worker's comp is a safety net for federal employees and others. As you approach retirement age or become eligible for Medicare due to disability, it's crucial to understand how worker's comp intertwines with Medicare to steer clear of confusion down the line.
Workers' comp and Medicare: What you need to know
Under Medicare's secondary payer policy, worker's comp should cover the expenses related to work-related injuries before Medicare chips in. This policy is in place to prevent double-dipping and ensure your worker's comp benefits handle your medical bills first.
However, in situations where immediate medical costs pile up before your worker's comp settlement arrives, Medicare may pay the bills initially. In such cases, the Benefits Coordination & Recovery Center (BCRC) will initiate a recovery process to collect the payment once your settlement is in hand. To avoid this, the Centers for Medicare & Medicaid Services (CMS) prefers to keep tabs on the funds you receive from worker's comp. In some cases, they'll request a Medicare Set-Aside Arrangement (WCMSA) to ensure that Medicare covers your remaining medical costs only after the WCMSA funds are depleted.
Reporting your worker's comp settlement to Medicare
In order to safeguard your Medicare coverage, you must report certain worker's comp settlements to CMS. Specifically, you're required to submit a Total Payment Obligation to the Claimant (TPOC) if you're already enrolled in Medicare or will soon become eligible, and the settlement you're receiving exceeds $25,000. If you're not yet eligible for Medicare but will be within the next 30 months, and the settlement amount exceeds $250,000, a TPOC is also necessary. It's also worth noting that you must report any liability or no-fault insurance claims to Medicare as well.
FAQs
Questions about Medicare and workers' comp can be addressed by contacting Medicare directly. You can dial 800-MEDICARE (800-633-4227, TTY 877-486-2048), with live chat available on Medicare.gov during specific hours. If you have questions regarding the Medicare recovery process, you can contact the BCRC at 855-798-2627 (TTY 855-797-2627).
There has been some confusion surrounding Medicare set-asides. While they are voluntary, if you wish to establish one, your worker's comp settlement must exceed $25,000 if you're already on Medicare or eligible within 30 months. It's crucial to note that the funds in a Medicare set-aside arrangement are intended for medical expenses associated with your work-related injury and cannot be used for any other purpose. Misusing these funds can lead to complications such as claim denials and having to repay Medicare.
The bottom line
In a nutshell, worker's comp is insurance for job-related injuries or illnesses for federal employees and certain other groups. By understanding how worker's comp interacts with Medicare, you can protect your medical expenses and avoid unnecessary complications in the future. Make sure to report worker's comp settlements to Medicare as required to maintain your coverage and stay clear of issues down the line.
For more resources on medical insurance, pay a visit to our Medicare hub.
- Worker's comp, as insurance for job-related injuries or illnesses, is crucial for federal employees and others.
- Under Medicare's secondary payer policy, worker's comp should cover expenses related to work injuries before Medicare.
- If immediate medical costs occur before worker's comp settlement, Medicare may pay initially, causing a recovery process later.
- To avoid this, CMS prefers tracking worker's comp funds and may request a Medicare Set-Aside Arrangement (WCMSA) for remaining medical costs.
- Reporting worker's comp settlements to Medicare is necessary when exceeding certain thresholds (above $25,000 for Medicare-enrolled or eligible individuals within 30 months, or above $250,000 for those not yet eligible but will be within 30 months).
- Seek answers to questions about Medicare and worker's comp by contacting Medicare directly, or the Benefits Coordination & Recovery Center (BCRC) for matters concerning Medicare recovery process.
