CMS to Increase Availability of “Fixed Percentage” Option for Reimbursement of Conditional Payments

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by Settlement Consulting Team

Medicare recently issued a notice that the requirements associated with the fixed percentage approach to resolving conditional payments associated with certain settlements are changing.

Effective October 2, 2023, the $5,000.00 amount listed below will be raised to $10,000.00. Below is the current language regarding this option from the Demand Calculation Options page on website:

Fixed Percentage Option
If a settled case meets certain eligibility criteria, you or your attorney or other representative may request that Medicare’s demand amount be calculated using the Fixed Percentage Option. The Fixed Percentage Option offers a simple, straightforward process to obtain the amount due to Medicare. It eliminates time and resources typically associated with the Medicare Secondary Payer (MSP) recovery process since you will not have to wait for Medicare to determine the conditional payment amount prior to settlement. You may elect the Fixed Percentage Option, if the following eligibility criteria are met:

        • Your liability insurance (including self-insurance) settlement, judgment, award or other payment is related to an alleged physical trauma- based incident and;
        • Total settlement is for $5,000.00 (Note this amount will be raised to $10,000 effective October 2, 2023) or less.
        • You elect the option within the required timeframe and Medicare has not issued a demand letter or other request for reimbursement related to the incident.
        • You have not received and do not expect to receive any other settlements, judgments, awards, or other payments related to the incident.

CMS also provides additional information including a Fixed Percentage Option presentation.

Interestingly, this notice indicates the Fixed Percentage Option may be available for both liability and workers’ compensation claims. However, the website continues to only apply this option to liability claims.

The increase in the total settlement amount for this option may pave the way for parties to address conditional payments in an expedited fashion prior to settlement.

If you have any questions regarding the Fixed Percentage Option or conditional payment recovery, please contact the IMPAXX Settlement Consultant team at [email protected].