Integrating Social Security and Medicare for Cost-Effective Solutions

Recession Raises Profile of Medicare Verifications, Says Allsup

Transitional times carry risk for insurers, who can better protect their operations with more detailed information as July 1, 2009, MMSEA compliance deadline approaches
 
Belleville, Ill. - April 8, 2009 - As reports circulate about how the recession is affecting companies and workers, it's crucial for insurers to comply with Medicare Secondary Payer laws, according to Allsup. Allsup helps employers coordinate their group health, disability and workers' compensation benefit plans with Social Security and Medicare.
 
With companies shedding jobs in the recessionary environment, more workers are looking to resources such as workers' compensation and disability insurance. This means that insurers can expect to see an impact, according to Financial Week magazine, which recently reported that WC claims expenses and frequency are likely to grow. Insurance Networking News also reported on the impact of an economic downturn, citing underwriters' concerns that plant closings lead to a surge in workers' compensation claims.
 
A new Allsup study shows that Social Security Disability Insurance (SSDI) claims have generally increased during the seven recession periods over the past four decades. The 40-year analysis includes the current recession, which began in December 2007, according to National Bureau of Economic Research data.
 
During 2008, the number of disabled workers applying for SSDI benefits reached a record high of more than 2.3 million, according to data from the Social Security Administration (SSA). Disability applications overall have reached 2.6 million.  
 
As the economy contracts, people who have struggled with a disability or work-related injury are forced to look for alternatives they might not have otherwise considered, including SSDI, which is why applications are increasing. One of the results of these trends is an increasing number of people who are eligible or covered under Medicare.
 
"For insurers, this means a changing environment that really demands they become better informed about their compliance requirements and liabilities," said Rob Sokol, director of commercial sales at Allsup.  
 
"Ultimately, they are responsible for the information that will keep them in compliance with SCHIP stipulations and help them avoid penalties that take effect July 1, 2009," Mr. Sokol said.
 
This is the reporting deadline for non-group health plans under the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA), which further extends safeguards that ensure Medicare's status as secondary payer.
 
Under Section 111 of MMSEA, group health plans and workers' compensation, liability and no-fault claim providers must report all cases to the Secretary of Health and Human Services (HHS) when the insured claimant is Medicare entitled. The penalty for not complying is $1,000 per day per claim. The effective date for reporting was Jan. 1, 2009, for group health plans and July 1, 2009, for non-group health plans, including workers' compensation handlers.
 
Allsup is offering its Medicare Verifications Service to address this particular issue for providers. The service is part of a suite of Medicare Secondary Payer compliance services that include Medicare beneficiary notifications, conditional lien services and Medicare Set-Aside services.
Medicare verifications, provided quickly and accurately by Allsup, are the first and essential step toward meeting Medicare Secondary Payer compliance, according to Mr. Sokol.
 
"Having this information in hand is one of the first steps toward establishing and resolving other aspects of a claimant's situation," he said. "Allsup has demonstrated for many providers the value of these and related MSP services."
 
"These changing times mean that providers must increase their vigilance for compliance, and Allsup is here to add more strength to their efforts," he added.
 
For more information, contact Allsup at r.sokol@allsupinc.com.