Providing Clarity in the Complexities: How Carrier Resources Aid in MSA Settlements

In most cases, your workers’ compensation carrier should be a strong advocate for full and final settlements in long-tail workers’ compensation claims. Settling a claim with a Medicare Set-Aside (MSA) can be a win-win for all stakeholders, even when it may not look like it on the surface. It can eliminate ongoing claim exposure, while also allowing the injured worker more flexibility, enabling them to make decisions about their care without including the insurance company.

“Your carrier’s goal should be to unburden the injured worker and put their care first by ensuring medical benefits are properly handled,” said Dan Clayton, Senior Claims Manager at Safety National. “Successfully achieving this with settlements that involve an MSA often requires breaking down the complexities with an opposing counsel or injured worker. Discussing the stability and long-term financial guarantee of how these can be structured can eliminate barriers when there are concerns with the impact on their well-being.”

Here are three additional roles that a workers’ compensation carrier can play in the MSA settlement process.

1. Educating clients and TPAs on the complexities of MSAs, Centers for Medicare & Medicaid Services (CMS) challenges, and settling claims.

Carriers can play an essential role in educating all business partners and stakeholders about the MSA settlement process and why certain decisions make the most sense. When faced with these large exposures in their coverage level, carriers want to ensure that insureds understand and are comfortable with the action plan. These discussions can also include defense counsel, TPAs, and, when interested, brokers.

An insured’s policy language typically supports a carrier’s judgment, but it is still vital that the rationale behind any decision is explained. Carriers should also be familiar with jurisdictional needs and requirements. The goal should always be to prioritize the care and needs of the injured workers.

2. Utilizing a network of vendors to overcome obstacles with settlement parties.

Regardless of how an injured worker proceeds with their claim, whether being pro-se working directly with a TPA or with an attorney through litigation, the idea of closing medical benefits can be off-putting. It is finite and can be scary for an individual who has become reliant on those benefits, with the change feeling unnecessary or unfair. Additionally, the workers’ compensation system can be confusing as most people are unfamiliar with it.

It is not uncommon for workers’ compensation claims to be open for several years and for the injured worker to become accustomed to the patterns. As such, suggesting an MSA settlement can be met with heavy resistance. A few ways that vendors can resolve these objections include:

• Explaining the benefits offered by an MSA – The injured worker’s counsel is focused on their client’s best interest and may not see the overall benefit. However, there is relief in certainty offered by the long-term guarantee of available funds to care for the injured worker. Third-party negotiation vendors can also offer an unbiased approach in mediation, with no stakes on the outcome.
• Educating the injured worker – The injured worker may be hesitant, so it is vital that they understand they are not forfeiting treatment or benefits. It is simply being replaced by a different process. This seamless method ensures that the appropriate party is billed and that an injured worker is not left to handle expenses.
• Connecting and communicating with stakeholders – A great vendor will habitually communicate with the attorneys or injured workers. Vendors can also send literature packets to educate them, which is an invaluable tool in ensuring everyone’s comfort throughout the process.

3. Managing the professional administration of MSAs.

After an annuity quote has been offered, terms and negotiations have been discussed, and an agreement is reached, a workers’ compensation carrier may offer professional administration at a limited cost. This unburdens an injured worker and ensures that the MSA funds are being distributed correctly, while also being tracked and paid appropriately. It also ensures CMS compliance with the knowledge that all requirements are met. Additionally, if any CMS audits or disputes arise, they can be quickly handled, minimizing liability.

For the injured worker, professional administration provides the same access to medical services as self-administration, providing consistent medical treatment throughout the life of their annuity. This can also be advantageous since annuity fund managers have detailed perspectives on medical bills and, when applicable, can provide savings with negotiated rates or other reductions.