Medicare Set Aside and Workers' Compensation


Sometimes in workers’ compensation we hear the term “Medicare Set Aside”, or more commonly, MSA.  So, what is an MSA?  Just like it’s title, an MSA is a set-aside.  When an injured worker settles their claim and is expected to have future medical bills associated with their injury and are receiving or will start receiving Medicare, they will be required to set up an MSA.

The MSA contains money from the workers’ comp settlement that covers future medical expenses.  How much goes in the MSA is established by developing a comprehensive estimate of every possible future medical expense related to an injury, including doctor’s visits, surgeries, and prescriptions.  The money that is placed in the MSA is then used to cover all future medical bills and only after that money is gone does Medicare become responsible for paying those bills. 

You might be wondering why you would even need an MSA.  Under the law, Medicare is a secondary payer, which means if another form of insurance is available (i.e. workers’ comp insurance), then Medicare does not pay for medical bills until that other insurance is exhausted.  An MSA is Medicare’s way of making sure that when you settle your workers’ comp claim those settlement funds are truly being used for future medical expenses and their responsibility does not kick in until that money is gone.

When the MSA has been approved, you may choose to self-administer, controlling your own MSA funds and payments, or utilize a professional administer, who will help with provider negotiations and payment disbursement. Whatever option you choose, it’s important to keep records and receipts for any transaction.

Remember, the funds that have been set-aside are there for your future medical bills and should not be spent elsewhere. Violating any rules of the MSA could jeopardize future funds or reimbursement.

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