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Will You Lose Your Medicare Coverage When You Settle Your Personal Injury Case?

Medicare coverage is only used to pay medical bills that have not been covered by any other responsible party. While this is extremely helpful, it also means that settling your personal injury claim can cause you to lose Medicare coverage in some circumstances. If you settled a case in which you made a claim for future medical treatments, Medicare will conclude that you must now pay for your future medical treatment using that settlement and then refuse to pay you any further. With the help of an attorney, though, you might be able to settle your injury claim without jeopardizing much-needed Medicare coverage.

Creating & Using a Medicare Set-Aside

Medicare has created guidelines for settlements in workers' compensation cases that will protect a claimant’s Medicare coverage after the settlement of their case. Medicare has not yet done this for third-party liability settlements, but it is reasonable to believe that following Medicare’s guidelines for workers' compensation cases will protect a claimant in a personal injury liability claim, too. The guidelines can be found online in a Centers for Medicare & Medicaid Services (CMS) document titled Workers Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide May 11, 2020. [Please click here to load a PDF file from the official CMS website.]

In worker’s compensation cases, Medicare provides for the creation of a Medicare Set-Aside (MSA), which can be used to collect a settlement without sacrificing Medicare benefits.

To use an MSA properly, you should follow these steps:

  1. Determine the cost of your future medical treatment. You can hire a company like MEDVAL or Synergy Settlement Services to prepare a Medicare Set-Aside allocation, but there are many from which to choose. You can research them on your own or speak with an attorney for guidance.
  2. Take the money allocated for your future medical treatment out of your settlement and place it into a Medicare Set-Aside (MSA) account. You can manage this Medicare Set-Aside (MSA) yourself by following Medicare’s guidelines or hire a company to manage it for you.
  3. Pay your injury-related medical bills from your MSA account, not from any other source. If your MSA account is eventually exhausted Medicare will begin to pay the bills again.

When in Doubt, Ask an Attorney

Paying for future injury-related care, otherwise covered by Medicare, out of a personal injury settlement is a developing area of the law with frequent twists and turns. It is important that you consult an attorney about the current requirements and the best way to protect your Medicare coverage. Otherwise, you could lose those benefits and spend a big portion of your settlement on medical care.

If you live in Laurel, Maryland, or the surrounding area, McGowan & Cecil, LLC and our personal injury attorneys can help you navigate your case and see if you can make an MSA if a settlement is reached. We are highly familiar with both liability law and Medicare coverage complications, so we are confident we can walk you through your case, regardless of its complexity. Our professional network of industry experts also lets us connect with companies that can assist with your Medicare Set-Aside, giving you yet another bonus when choosing us to represent you.

Dial (301) 761-2007 to speak with a member of our law firm today about your case. You can also use an online contact form if you prefer. If you want to know more about the case types we manage for our clients, please click here.

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