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LMSA-NFMSA-questionsOn September 1, CMS hired Capitol Bridge, LLC to be the new review contractor for MSAs. According to CMS employees that we’ve spoken to, the transition is currently underway. The old contractor is staying on for an indeterminate amount of time to help with the transition. We expect the transition will take anywhere from 60 to 90 days. Based on our prior experience with a change in MSA review contractors, this may have a significant impact on CMS approved MSAs.

First, we expect that CMS will soon announce a formal process for a Liability MSA approval process. You can read more about our concerns in our prior blog post: It is happening: LMSAs (and NFMSAs) are almost here.

Second, during the transition to a new review contractor we have to determine how long it is going to take to obtain CMS approval. Can the new contractor maintain the 30 to 40 day approval process that is currently maintained by outgoing contractor? Or will things slip back to the 6 month approval process we had to endure several years ago?

Third, and most importantly, how will the new contractor allocate for MSAs? Each prior contractor has had its own methodology of allocating MSAs. Will the new contractor’s methodology increase or decrease MSAs? Will the new contractor follow state law as required by the WCMSA Reference Guide? How will the new contractor handle the newly instituted Amended Review process?

It will probably take the industry about six  to 12 months to obtain concrete answers to these important questions. In the meantime, obtaining CMS approval will be an interesting endeavor as we all try to figure out the methods and processes of this new player in the MSA world.

Michael R. Merlino II, ESQ.
SVP of Medicare compliance and structured settlements

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