In 2017, when the Center for Medicare and Medicaid Services (CMS) updated its Medicare Set Aside (MSA) Reference Guide, it added a provision that allowed a one-time opportunity to request an ‘amended review' of a conditionally preapproved MSA account. When a case met the required elements of the new rule, claimants and carriers could re-submit their MSA proposal based on evidence of circumstances that came to light after the initial submission was approved. Over the following three years, experience with the amended review process has provided insights into CMS decision-making, as well as illustrated when making such a request is advantageous to each side of an MSA case.

Clarifying "Re-review" vs. "Amended Review"

CMS is offering the new amended review opportunity in addition to the already standard 're-review' of an approved MSA agreement.

Re-review

The opportunity to request a re-review of an approved MSA has always been part of the MSA process. WCMSA Reference Guide v3.0 §16.1. It applies when there is an 'obvious error' in the calculation of the value or documentation of the MSA case that changes the value of the MSA account, and that the parties discovered the error only after approval of the MSA application. The reviewed submission will correct the mistake(s). In a re-review case, the underlying facts of the case don't change and the corrected file assures CMS of the protection of its interests as a secondary payer within the case.

Amended Review

The opportunity for an amended review arises when the facts of the case have changed, and those changes now alter the value of the MSA allocation by at least 10% or $10,000. WCMSA Reference Guide v3.0 §16.2.Parties can only request the review when their Workers’ Compensation case (WC) has not settled but continues in litigation for more than 12 months (one year) and less than 72 months (six years) after approval of the original MSA. (In October 2019, CMS extended the time window for submitting a request from four years (48 months) to the new six-year standard.)

The amended approval opportunity aligns the CMS with several state laws that allow for re-opening the WC case in the event relevant health and healthcare care conditions change after that case has closed. While that opportunity provides for changes to the WC case itself, there was no such opportunity available to make consequent changes to the attendant MSA, when such an account was open. With this new CMS provision, plaintiffs and defendants can modify their MSA agreement to reflect the altered facts of the WC case.

Possible Outcomes of an Amended Review

The amended review process facilitates two equal goals: to protect CMS from paying for services that are rightly assignable to the primary payer, and to assist in the resolution and closure of long-term legal cases. It reflects the reality that circumstances change over time, and that 'final resolutions' must also often be fluid. The amended review process allows CMS to take into account those relevant MSA case factors that emerged after the MSA proposal was initially approved and that now might materially change its outcome.

Protecting CMS

Per the Mandatory Secondary Payer Act (MSP), CMS is liable for the healthcare costs of injured beneficiaries (or soon-to-be beneficiaries) only after all other 'primary' resources are exhausted. In the case of most MSAs, the MSA document itself clearly defines the obligations of a primary health care resource to an injured worker, and settled medical practices provide the guides needed to establish those medical cost parameters. CMS can sign off on the MSA proposal because it is assured that the primary payers are accepting and will follow through with their obligation to cover the short-, mid-, and long-term costs of the specific injury.

In those cases that suggest an amendment is in order, the circumstances of the case will have changed, and CMS is no longer confident that it will not be asked in the future to cover costs arising from the work-place injury. In these cases, the total value of the MSA may need adjustment for one of two reasons if or when the claimant's health care needs change:

• • If medical coverage for the job-based injury needs extending beyond the established timeframe, then the MSA should be amended to reflect that reality. Here, it would be appropriate to change the MSA to reflect the primary payer's obligation to increase the account funds to accommodate the extended extra care costs.
  • If the claimant recovers faster than expected, or medical treatments have come available that reduce the time or cost of medical coverage, then the MSA value should be adjusted to reduce the primary payer's obligation. In this case, CMS must have full notification of changes in the claimant's condition. Without a complete file reflecting the actual conclusion of the WC case, CMS can't know how or when the WC case actually resolved, both physically and financially. Consequently, the claimant could face coverage challenges or denials when filing for future Medicare benefits if their new injury or condition resembles their previous injury status.

Protecting Case Participants

A qualifying factor for filing an amended review request is that the case hasn't settled. In many, and perhaps most of these cases, that failure is caused by disputes related to the type and value of future medical care and costs.

• Plaintiffs are looking for the highest settlement value possible to ensure they have the resources necessary to achieve a complete recovery from their injuries. Their body may not be responding as quickly as expected to their treatment plan, or perhaps the original treatment plan hasn't been effective. They may have other health concerns that exacerbate their injured status, making it harder for them to recover within a 'standard-for-the-injury' time frame. In these cases, it's imperative for their health that they can access the treatments they need to recover from an injury they suffered at work.
• Defendants (employers, insurers, etc.), on the other hand, are looking to keep long-term costs down to protect their corporate resources as much as possible. An MSA can account for hundreds of thousands of dollars, and these parties are looking to limit that value in the final settlement agreement. These companies have an obligation to their workers and shareholders to seek an MSA modification when changes in healthcare or the insured's health can redirect some of those dollars back to corporate use.

Proving an Amended Review Claim

Not surprisingly, convincing the CMS to change an already approved MSA requires substantial and credible evidence that the change is warranted. The Agency looks for 'best evidence' - those documents and records that come from an original source and that are clearly and directly related to injury care. Further, those records must prove that the initial MSA value is now off by 10% or $10,000, whichever is greater. The injured worker must prove that current circumstances justify an increased MSA value by at least 10% or $10,000; the employer/insurer must prove that current medical interventions can reduce the actual cost of care (as opposed to the approved funds set aside) for the injury by at least 10% or $10,000.

The Agency is also specific about what types of evidence can prove the adjusted claim and how to document that evidence properly:

• The amended proposal must include line items that were also included in the first proposal and that identify the care services already provided to the injured worker. Documents that reference those services must accompany the amended proposal.
• The amended proposal must also demonstrate where services and supports were authorized but were not required.
• If/when those un-used services were replaced with other comparable services, then there must also be documentation of that fact, including the records of the healthcare professionals who provided or will provide the replacement services.
• When seeking funding for new or different services or supports, then the proposal must include both a line item detailing that/those new values, as well as documentation that supports the premise that the revised healthcare support is appropriately tied to the injury.

A Prescription Drug Caution

Every requested modification of the original MSA must justify how any proposed change relates to the injury and the care and recovery of the injured worker. For prescription drugs, a difference in price in and of itself is not sufficient to justify changing the MSA, although that may be significant when a generic drug becomes available. Instead, the party seeking the change must establish that the revised pharmaceutical request addresses the medication recommendations for the specific injury, and that it meets the standards otherwise set for MSA inclusion:

• The injured party must have been taking the original medication for two years before filing the amending request;
• the drug must have been prescribed specifically to treat the work-place injury, and
• the medication is being used for a medically accepted indication.
• The revised pricing structure for the medication is presented using Average Wholesale Pricing standards. The Agency uses AWP for setting MSA values for pharmaceuticals, with generic drugs being priced lowest and brand name drugs priced highest. The AWP for most drugs sold in the U.S. is published in drug compendiums (indexes), as is the Wholesale Acquisition Cost (AWC) - the price paid by the wholesaler to the drug manufacturer. It is this cost, plus or minus discounts or further markups by the wholesaler, that establishes the amount estimated for use when determining the allocation in the proposal MSA.

Documents supporting these claims include drug prescription and medical treatment payment records dated within six months of the request, the insurer's prescription claim records, and the pharmacy benefits manager records.

For amended review requests that seek to reduce or increase the projected value of prescription drugs, parties filing the claim should detail the injured person's experience with the drugs correctly and make a direct connection between the use of the drug and the work-related injury.

The amended review opportunity provides an avenue for re-assessment for injured workers and their insurers when the case resolution details of the underlying WC case change. When handled correctly, the amended review action can ensure that injured workers retain the long-term healthcare services they need, or that insurers can recoup the MSA funds that are no longer necessary for future injury care. Considering the speed by which new medical capacities and capabilities are advancing, it’s probable that the amended review process will be pursued more frequently in the years to come.