CMS – Medicare Secondary Payer Rule and Mandatory Reporting Provisions » Clinical Research Hub » Clinical and Translational Science Institute » University of Florida (2024)

FAQs

What is the CMS secondary payer rule? ›

Medicare Secondary Payer (MSP) is the term used by Medicare when Medicare is not responsible for paying first. In other words, any “liability insurance policy or plan,” which includes self-insured plans, must be billed first, prior to any claim presented to Medicare. See Medicare Secondary Payer.

The purpose of Section 111 reporting is to enable Medicare to correctly pay for the health insurance benefits of Medicare beneficiaries by determining primary versus secondary payer responsibility. Section 111 authorizes CMS and GHP RREs to electronically exchange health insurance benefit entitlement information.

Medicare regulations require providers who submit Medicare claims to determine whether Medicare is the primary payer or secondary payer for items or services furnished to a beneficiary.

Section 111 NGHP reporting of applicable liability insurance (including self-insurance), no-fault insurance, and workers' compensation claim information helps CMS determine when other insurance coverage is primary to Medicare, meaning that it should pay for the items and services first before Medicare considers its ...

Based on this regulation, hospitals must document and maintain MSP information for Medicare beneficiaries. Without this documentation, the A/B MACs and DME MACs would have nothing to audit submitted claims against. CMS recommends that providers retain MSP information for 10 years.

If the disabled person still has insurance from an employer or from a working spouse's employer, Medicare is secondary if the employer has at least 100 employees, but primary if it has fewer. When Medicare is secondary, the primary insurer should always be billed first.

CMS will calculate penalties based upon a tiered structure, such that the longer the delay in successfully submitting a Section 111 report, the higher the penalty amount, ranging from $250 to $1,000¹ per day of noncompliance.

The Final Rule was effective December 11, 2023, which was 60 days after it was published. However, no CMPs will be imposed until at least October 11, 2024, one year after the Rule was published. The Final Rule is prospective in nature; therefore, no CMP will be imposed on an entity for prior noncompliance.

The MSP provisions have protected Medicare Trust Funds by ensuring that Medicare does not pay for items and services that certain health insurance or coverage is primarily responsible for paying. The MSP provisions apply to situations when Medicare is not the beneficiary's primary health insurance coverage.

What is the timely filing limit for Medicare secondary payer? ›

Answer: The timely filing requirement for primary or secondary claims is one calendar year (12 months) from the date of service.

Medicare uses the amount the provider is obligated to accept as payment in full in its payment calculation. In such cases, the provider reports in value code 44 the amount it is obligated to accept as payment in full. Medicare considers this amount to be the provider's charges.

To aid settling parties in determining this information, Congress has enacted the Provide Accurate Information Directly Act also known as the PAID Act requiring that CMS provide Non-Group Health Plans with a Medicare beneficiary's Part C and Part D enrollment information for the past three years.

The threshold amount for 2023 was $750.00. On February 14, 2024, CMS announced the same threshold will apply for 2024.

The Mandatory Insurer Reporting Law (Section 111 of Public Law 110–173) requires all insurers to report the Social Security and Medicare health insurance claims numbers of its members who meet certain reporting criteria to the Centers for Medicare and Medicaid Services (CMS).

Providers may use this as a guide to help identify other payers that may be primary to Medicare. This questionnaire is a model of the type of questions that may be asked to help identify Medicare Secondary Payer (MSP) situations.