Conditional Payments: Recent Wins


By P. Czuprynski

After administrative appeals, IMPAXX recently won two claims associated with conditional payments. In both cases, Adjudicators (ALJ) with the Office of Medicare Hearing and Appeals determined Medicare did not require reimbursement for treatment that was more than three years from Medicare’s demand for payment.

We wanted to discuss the significance of these cases and reaffirm why parties facing Medicare’s collection should challenge Medicare’s improper requests for reimbursement.

Quick Overview – MSP Act
The Medicare Secondary Payer (MSP) Act may require reimbursement to Medicare when two factors are true:

    1. There is a reasonable expectation of payment under the plan or law associated with a non-group health plan claim (i.e., Workers’ Compensation, liability, med pay, etc.); and
    2. Where responsibility for the payment is demonstrated by the facts of the claim

While the above factors provide a baseline for reimbursement, the MSP Act provides additional parameters for Medicare’s collection. For example, Federal Code 42 U.S.C. §1395y(b)(2)(B)(vi), states that Medicare’s demand for reimbursement should only include medical treatment (dates of services) occurring within three years from the request for repayment. This means if Medicare sends a demand letter dated February 1, 2022, the request for reimbursement should only contain dates of service (treatment) from February 1, 2019 to February 1, 2022.

Time is on Our Side
In the first case, the primary payer notified Medicare it had accepted Ongoing Responsibility for Medical (ORM) in October 2011.  Six years later, in November of 2017, Medicare issued a demand for payment. However, all the dates of service listed for reimbursement predated November 2014, except for one.

As a result, the ALJ determined that 42 U.S.C. §1395y(b)(2)(B)(vi) applied and payments for treatment before November 2014 did not require reimbursement under the MSP Act. This limited Medicare’s reimbursement request to $86.00.

In the second case, a workers’ compensation claim was settled in January 2018.  Medicare was notified of settlement and demanded payment in March 2018.  However, all dates of service listed by Medicare predated March 2015.

Therefore, the ALJ ruled that 42 U.S.C. §1395y(b)(2)(B)(vi) applied and any charges prior to March 2015 did not require reimbursement. This was despite the fact Medicare was notified of settlement only a few months prior to its demand. It also limited Medicare’s reimbursement to $0.00.

Why These Decisions Matter
These decisions are noteworthy because they:

    • Demonstrated that a three-year dates of service argument may be valid against Medicare Parts A and B
    • Placed the responsibility on Medicare to act promptly once it received notice of ORM or settlement
    • Limited Medicare’s ability to surprise a carrier/self-insured (or Medicare beneficiary) with excessive demands for treatment from date of injury to reimbursement request
    • Demonstrated the need to challenge lower-level Medicare decisions that are contrary to the MSP Act and its supporting regulations
    • May apply to situations post settlement where Medicare is asking for repayment several years after a settlement

As shown above, we are critically reviewing, and when appropriate aggressively challenging, Medicare collections. We encourage injured parties facing Medicare collections to do the same. We will continue to keep you posted as significant decisions are announced.