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Medicare
'Section 111' Claim Reporting NOTE: On Feb. 18, 2010, the U.S. Center for Medicare and Medicaid Services announced that the date for implementing secondary payer claim reporting was being pushed back to Jan. 1, 2011, nine months after the previously scheduled implementation date. As of Jan. 1, U.S. insurers that write coverage for bodily injury and medical payments will have to start reporting to Medicare every time they pay a claim to a person enrolled in Medicare. AAIS programs affected by the liability claim reporting mandate are:
For more information, go to the CMS website. Background This reporting obligation is a new departure for insurers because it comes from the federal government and it requires the pre-screening of claimants or potential claimants by the reporting of personally identifiable information, such as Social Security numbers. For this and other reasons, the new liability claim reporting requirement is distinct from traditional statistical reporting mandated by the states and carried out by licensed statistical agents. The reporting obligation arises from Section 111 of the 2007 Medicare, Medicaid, and SCHIP Extension Act (MMSEA). Group health plans and other entities that pay medical claims for individuals are also subject to the "Section 111" reporting requirement. Under federal law, Medicare is designated as the secondary payer of claims made by people eligible for coverage under other insurance. Medicare can make conditional payments to people with other, primary insurance, but Medicare must be reimbursed for any payments for which another insurer is determined to be responsible. MMSEA and the Section 111 reporting requirement were enacted to help coordinate benefit payments, reduce the incidence of duplicate payments, and recoup Medicare payments where warranted. The statutory penalty for failing to report a relevant claim is $1,000, and the law also sets forth procedures for Medicare to bring legal action against other parties, including liability insurers, for failure to make proper reimbursement. Among other things, the law allows the federal government to collect double damages in certain recoupment actions. AAIS recently issued a bulletin with background information, and will issue notices from time to time regarding important deadlines and product developments by vendors. Given that Section 111 is distinct from the role of a licensed insurance statistical agent, AAIS will not be directly involved in helping companies implement Section 111 reporting solutions.
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