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The SMART Act was passed into law by President Obama on January 10, 2013, as a mechanism to modify and improve upon Medicare’s Secondary Payer requirements. Those provisions of the Social Security Act were enacted in 1980 to establish Medicare as a secondary payer to certain primary plans if payment has not been made or cannot reasonably be expected to be made to the beneficiary by a primary plan.

In those cases, Medicare may make a “conditional payment” with the expectation it will be repaid when the beneficiary receives a settlement, judgment, award or other payment. Conditional payments are for items or services that are later determined to be the financial responsibility of a health plan.

Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA) added mandatory reporting requirements with respect to Medicare beneficiaries who who receive settlements, judgments, awards or other payment from workers’ compensation

As required by section 202 of The SMART Act, CMS is required to annually review its costs relating to recovering conditional payments as compared to recovery amounts.

For the last two years 2017-2018, CMS has maintained the threshold of $750 across all non-group health plan (NGHP) lines of business- workers’ compensation, liability, and no-fault insurance.

The threshold means that if the Total Payment Obligation to the Claimant (TPOC) amount is $750 or less, the claim does not need to be reported to Medicare and parties do not need to be concerned with reimbursement of conditional payments.

CMS has announced that the threshold for 2019 will remain at $750, therefore, no changes to reporting/conditional payment practices are necessary at this time.

CMS has additionally posted an Alert regarding an upcoming MSPRP webinar: November 19, 2018 – Webinar for Upcoming Enhancements to the Medicare Secondary Payment Recovery Portal (MSPRP):

Effective January 7, 2019, new functionality will be added to the MSPRP that will allow authorized users to self-report, Non-Group Health Plan (NGHP) Medicare Secondary Payer (MSP) leads.

CMS will host a webinar on December 18, 2018 to provide additional information on this enhancement.