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Medicare Conditional Payment/Set-Aside F.A.Q.

1. When must Medicare’s interest be considered?
Medicare’s interest must always be considered whenever:
(A) Medicare has paid for treatment for a disability/injury alleged in the claim petition; and/or
(B) In the closure of a workers’ compensation case the petitioner is Medicare entitled and future medicals for a disability/injury maintained in the claim petition are being foreclosed.

2. When is a petitioner considered “Medicare entitled”?
>A petitioner is Medicare entitled if he or she is:
65 years or older (assuming sufficient work quarters); or
On Social Security Disability (SSD) for 24 months or longer; or
Suffering from End Stage Renal Disease (ESRD).

3. Is repaying Medicare for conditional payments (or obtaining a waiver) always required when the petitioner has received Medicare benefits?
Yes. CMS recommends that the process outlined under Question 4 of this memo be initiated as soon as possible for petitioners who have received Medicare benefits. To ensure that a record of any Medicare benefits be established, this process must be initiated in all cases when the petitioner is a Medicare beneficiary. One should also keep in mind that repaying CMS for past /conditional payments Medicare made on behalf of the petitioner is required even when no set-aside allocation review is required. Therefore, pleadings become very important in determining the extent to which past/conditional Medicare payment issues may play a role in resolving a claim. Plaintiffs/Petitioners who allege work injuries or disabilities that clearly cannot be sustained may be subjecting their cases to more extensive CMS/Medicare review and delay for alleged injuries or disabilities that will be found “non-compensable” later in the proceedings. In summary, adequate consideration must be given to the issue of conditional payments in all cases involving a Medicare beneficiary at the time of settlement. This includes cases resolved by Orders Approving Settlement, Section 20 Settlements, Judgments, and Second Injury Fund Awards. As long as the petitioner is a Medicare beneficiary, this issue must be addressed.

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