If you have Medicare and file for workers’ compensation, workers’ compensation pays primary (first) for all medical and prescription drug bills (claims) that are determined to be related to your injury.
If workers’ compensation doesn’t make a decision about paying your health care bills within 120 days, Medicare may make conditional payments for your bills. A conditional payment is when Medicare pays in place of workers’ compensation. Once the workers’ compensation claim is settled or a final decision or award is reached Medicare must be paid back.
If workers’ compensation denies a claim for a Medicare-covered service, Medicare should pay for the health care claim.
Sometimes workers’ compensation will only pay for some of the health care claims associated with an injury. For example, workers’ compensation might only pay part of your bills if you have a preexisting condition and your work injury made the preexisting condition worse. In this case, if the non-covered part of your bills are for Medicare-covered services, Medicare should pay these bills.
When you file a claim with your workers’ compensation you should also call the Medicare Coordination of Benefits Contractor (COBC) at 800-999-1118 and report the claim.
If you plan to settle your workers’ compensation claim, it is important to set aside funds in a special account called a “Workers’ Compensation Medicare Set-Aside Agreement.” This account is to pay future medical bills related to your injury and to repay Medicare for any conditional payments Medicare made. You will need a lawyer’s assistance to settle your claim and create this set aside agreement. Before reaching a workers’ compensation settlement, your lawyer should typically contact the Medicare Coordination of Benefits Contractor (COBC) to get Medicare approval of the amount you plan to put in the account.
You must typically use all of the money in your account for medical bills related to your injury before Medicare will start paying for your bills related to your injury. You or the organization that manages the account should keep track of how the money in the account is used. It is important to keep track of how the money is spent to prove to Medicare that the account funds were only used to pay your injury-related medical and prescription drug bills.