Is Bigfoot real? Are Liability MSAs coming?

After a decade of discussions and a GAO recommendation to do so in April of 2012, CMS announced on February 3, 2017 that it will be re-tooling the technical capacity of each individuals’ Common Working File to track liability MSAs: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R1787OTN.pdf.

While the advent of liability MSAs has often sounded like reports of Bigfoot sightings in Oregon or reading too much into the end of the Mayan calendar in 2012, the planning, expense, and aggressive timeline – – implementation on July 3rd and testing on October 1st – – associated with these technical changes indicates that CMS is serious about beginning an LMSA program. (For a more extensive briefing see Examworks’ Annie Davidson’s article.)

While this announcement lacks the certainty of a new statute, it roughly parallels how Medicare handled the inclusion of prescription drugs in MSAs. The Medicare Modernization Act of 2003 made clear that Part D would include outpatient prescription drug coverage effective January 1, 2006. While the official memorandum requiring MSAs to include prescription drugs was not published until December 30, 2005, the industry knew that MSA were about to be more expensive and ramped up its efforts to settle workers’ compensation claims throughout 2005.

Understanding that there may be fits and starts, I would encourage liability claims handlers to consider the possibility that 2018 may mean that LMSAs are in play. CMS’ pricing methodology – –  which is bereft of all cost containment sensibilities – – may increase the costs of settling the future medical features of your liability claim.  It may be far cheaper to move that claim in 2017 than in 2018. Furthermore, If CMS follows its pattern in 2005, you may only have 30 days’ notice from an official announcement to move those claims.

Because the difference between the traditional pricing of future medicals and CMSs methodology might be hard to fathom, I further recommend picking a few, expensive cases and asking a recognized, national MSA provider with strong legal and clinical expertise to assess the difference for you.  Perhaps it will inform a settlement strategy on some of your critical claims…just in case that infamous, blurry picture of Bigfoot is real after all.