MMI September 2010 - mmi home

Medicare Seafarer Health Issues 41
“In the event of a claim,
shipping companies
must be able to
demonstrate to
Medicare that they have
done all they can to
cover the individual’s
costs where they are
liable, disclose full
details of how they have
done this”
position to turn down future route changes
that would necessitate calls at the US.
Although the MSP has been in force for
years, the new Medicare reporting
requirements constitute an attempt by CMS to
introduce a more stringent and accountable
means of monitoring claims and
compensation settlements. CMS hopes that
the system will severely reduce the payment
of Medicare expenses wherever the primary
payer has the legal / contractual duty to do so.
Why Medicare’s ‘interests’
matter
As Ms Byron explains: “The onus is on primary
payers to prove that they have taken
reasonable steps to protect Medicare’s
interests.” Basically, in the event of a claim,
shipping companies must be able to
demonstrate to Medicare that they have
done all they can to cover the individual’s
costs where they are liable, disclose full
details of how they have done this.
Thomas Miller has advised its members:
“Whenever a settlement contemplates [or
should contemplate] compensation for future
injury-related medical expenses, the
language in the agreement should
demonstrate that the parties have considered
and taken any necessary steps to protect
Medicare’s secondary payer status.”
‘Protecting Medicare’s interests’ is a vital
consideration and should not be
underemphasised, Thomas Miller argues. If
there were any doubt regarding CMS’ ability
to fight its corner, last year proved otherwise.
In December 2009, the US filed suit in
Alabama federal court against a host of
attorneys, product manufacturers and these
manufacturers’ insurers, stemming from a
$300m personal injury settlement, reached in
2003, on behalf of the victims of alleged toxic
chemical dumping in Anniston, Alabama, in
the 1970s. The 2009 case ruled that, following
the 2003 payout, the corporations Monsanto
Co, Pfizer and Solutia had failed to reimburse
the money that Medicare had released for the
medical treatment of the Anniston claimants.
CMS also went after those lawyers that had
represented a sizeable portion of the
claimants, again on the grounds that the
Medicare money, provided for the affected
Anniston citizens’ care, had not been
reimbursed when the lawyers secured their
clients’ payouts. The fact that the US has
sought double damages from those
implicated in the case can be read as a clear
message regarding the government’s
renewed ‘zero tolerance’ approach towards
future lapses in transparency, and failure to
declare claim information up front.
In short, CMS does not lack the teeth to
take on some of the world’s largest
businesses, when it comes to safeguarding its
interests. Obviously, maritime companies
could potentially face similar action if they are
deemed to have withheld details of insurance
or compensation payouts from the new live
reporting system.
Are set-asides necessary?
By far though, the most confusing grey area
surrounds liability settlements, and
particularly the usage of ‘Medicare Set-Asides’
(MSAs) for these types of action. An MSA, as
Ms Byron simplifies, can be likened to a “trust
fund, established at the time of the
settlement”, where the employer earmarks a
certain amount of money for the future
treatment of a member of its personnel. MSAs
are generally not required for short-term
injuries, where the doctors have released the
patient and no future care is required.
However, returning to our hypothetical US
seafarer with the broken foot, this injury could
By far though, the most
confusing grey area
surrounds liability
settlements, and particularly
the usage of ‘Medicare Set-
Asides’ (MSAs). An MSA can
be likened to a “trust fund,
established at the time of the
settlement”
september 2010 ________________________________________________________________________________________________________ maritime medical international