By B. Smith

CMS has released a new version of the Workers’ Compensation Medicare Set-Aside (WCMSA) Reference Guide, 3.3, COBR-Q2-2021-v3.3 dated April 19, 2021. The new Guide includes additional language regarding the calculation of the seed money for structured settlements.

When a structured WCMSA is utilized by the parties, in addition to annual payments, a calculation of the initial deposit or “seed money” is required. Under prior versions of the Guide as well CMS’ practice, the seed money has included the cost of the first surgical procedure or replacement, if any, and two years of annual payments. CMS has now revised this language throughout the Guide to note that the seed money will include the cost of the first surgery for each body part. Specifically, this is noted in various sections of the Guide including 5.2, 9.4.4, 10.1, and Appendix 4.

CMS has not provided any additional guidance as to whether the number of surgeries for each body part will be limited to two, three, etc. when calculating the seed money. In addition, there is no clarification as to whether CMS will use an evidence-based medicine approach when making this determination if it is unlikely that all procedures will occur within the first year of treatment. Using this evidence-based medicine approach would help prevent the unnecessary saturation of the seed money and the potential inability of the parties to use a structured settlement in these cases.

Other changes in the Guide include some of the following:

  • An update to the 2018 Life Table for the calculation of life expectancy, which was implemented by CMS on March 27, 2021.
  • Section 9.4.5 regarding Intrathecal Pumps notes that pricing should include “necessary pump refills over the claimant’s life expectancy.”
  • Consent to Release Notes in Section 10.2 was updated to include the following language:
    Consent to Release documents must be signed (by hand or electronically) with the full name of either the claimant, matching the claimant’s legal name or by the claimant’s authorized representative, if documentation establishing the relationship is also provided. It must be a full signature, not initials.
  • Section 19.4 of the Guide was updated to include case access information for professional administrators who were not the original submitter and provides as follows:
    Professional Administrators whose EIN does not match the EIN of the original submitter, contact BCRC to gain access to the case via the WCMSA Portal; otherwise, you must submit by mail.
  • The major medical center table was also updated for Missouri entries.