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Medicare and Workers’ Compensation


When you have both Medicare and a workers’ compensation policy, you may run into confusion regarding your coverage. We’re here to provide clarity around settling claims, coordination of benefits, and more.

Medicare and Workers’ Compensation Coordination of Benefits

Coordinating benefits ensures that all medical claims receive payment in the correct order, by each insurance policy. It is essential to know how Medicare works with workers’ comp to guarantee correct payment of claims.

When utilizing multiple payers, it is vital to give your doctor, hospital, and other health care providers information for all applicable payers. Thus, ensuring they can adequately bill each payer.

Does Medicare Pay After Workers’ Comp?

When you use Medicare alongside workers’ compensation, Medicare will be the secondary payer. However, if workers’ comp does not pay within 120 days, Medicare will pick up the bill.

If workers’ comp decides to pay after Medicare foots the bill, workers’ comp will reimburse Medicare for the costs. Also, if workers’ comp refuses to pay a claim, Medicare will become the primary payer.

The same is true if workers’ comp deems the illness or injury a pre-existing condition. However, if the job worsens the condition, workers’ comp can agree to pay a portion of the costs, and then Medicare will pay its share.

Settling Workers’ Compensation Claims

Suppose you decide to settle your workers’ compensation claim. In that case, it is essential to know that you are responsible for repaying Medicare 100% of their payments.

Often, it is the responsibility of your lawyer to contact the settlement contractor and set up an account to reimburse Medicare for their expenses. It is also important to work with Medicare to designate a Workers’ Compensation Medicare Set Aside Agreement.

What is a Workers’ Compensation Medicare Set Aside Agreement?

A Workers’ Compensation Medicare Set Aside Agreement (WCMSA) is a specified amount of money from your workers’ comp settlement used for medical expenses before Medicare pays. Creating a WCMSA is not mandatory. However, if not made, you must spend the entire settlement amount on medically necessary costs related to the claim before Medicare will pay.

FAQs

Is it illegal to spend Medicare set aside money?
When you have a WCMSA account available, you can only use the funds to pay for medically necessary expenses that are related to your workers’ compensation claim.
Does workers' compensation follow Medicare guidelines?
Workers’ comp does not have to follow the same guidelines put in place by Medicare, However, if workers’ comp denies a claim Medicare would otherwise cover, Medicare will pay their portion.
How does Medicare coordinate with liability insurance?
When you have coverage through liability insurance and Medicare, Medicare will be the secondary payer.

How to Report a Workers’ Comp Claim with Medicare

Anytime workers’ compensation pays, reporting the claim information to Medicare’s Benefits Coordination & Recovery Center is crucial. This will ensure the healthcare provider does not receive duplicate payments and protects the insured from returning excess charges to the insurer.

Be sure to report the type of claim, the primary payer’s information, and the date and cause of the injury. This allows the insurers to understand who is primarily responsible for the costs.

Jagger Esch

Jagger Esch is the Medicare expert for MedicareFAQ and the founder, president, and CEO of Elite Insurance Partners and MedicareFAQ.com. Since the inception of his first company in 2012, he has been dedicated to helping those eligible for Medicare by providing them with resources to educate themselves on all their Medicare options. He is featured in many publications as well as writes regularly for other expert columns regarding Medicare.

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