For Workers Compensation Medicare Set-Asides (WCMSA), there is no requirement that they be submitted to the Centers for Medicare & Medicaid Services (CMS) for approval, although it is common for settling parties to do so.

What are the benefits of not submitting a WCMSA to CMS, and when does it make sense to take that course of action?

In 2001, CMS issued a memorandum—referred to as the “Patel Memo”—that introduced a voluntary review and approval process for WCMSAs.

Where a workers compensation settlement involves a Medicare beneficiary or an injured worker who has a reasonable expectation of Medicare entitlement within 30 months of the settlement, and CMS’ settlement-review threshold is met, the WCMSA may be submitted to CMS for review and approval.

A WCMSA allocates a portion of a workers compensation settlement for all future work injury-related medical expenses that are covered and otherwise reimbursable by Medicare (Medicare-covered).