Medicare project update - October 2009

The latest information with regard to the Medicare project is as follows:

Registration & Reporting

Non-US insurers, including Lloyd’s syndicates, are not yet able to register on the Centers for Medicare and Medicaid Services (CMS) reporting system.

In a Town Hall conference call on 6th October 2009, CMS stated that non-US insurers without a US address or a Taxpayer Identification Number (TIN) should not register until CMS issues further guidance. CMS advised that it anticipates issuing an alert on this topic shortly and there will be no financial penalty for not registering by 30th September 2009.

All Managing Agents writing risks that may give rise to in scope claims (per Market Bulletin Y4277 dated 12 May 2009) should advise their TPAs and Coverholders to await guidance from the Managing Agent regarding the registration and reporting processes for Lloyd’s market entities. The communication should also reiterate that relevant claims data should be collected for all “Ongoing Reporting of Medicals” (ORM) claims settled after 1st July 2009, and all “Total Payment Obligation Claimant” (TPOC) claims settled after 1st January 2010 (per Market Bulletin Y4306 dated 17 August 2009).

Claims Handling

XCS has established and implemented with immediate effect a new Cat Code, MEDI, which it will apply to all claims where the claimant is potentially Medicare eligible. For bordereaux business, XCS will record the data for all MEDI claims individually.

Lloyd’s met with the largest binding authority brokers at the BOLT Committee on 14th October 2009 to update them on our market approach. Via the BOLT Committee and LIIBA, the project team has now established an ongoing dialogue to engage effectively with the broking community.

The concurring view of the LMA, LMACC and Binding Authority Claims Group (BACG) is that claims settlement authority for Medicare beneficiary claims should be withdrawn to London at the present time; however, this standpoint will be kept under review. Managing Agents and brokers will need to be able to recognise the relevant Claims Agreement parties when authority is withdrawn to London. It will also be important for Managing Agents to ensure they are compliant with State Claims Settlements Practice laws when handling these claims.

A report by Wilson Elser Moskowitz Edelman & Dicker LLP, which outlined market guidance in respect of Medicare s.111; was circulated to all Managing Agents on 24th September 2009.

When contacting TPAs and Coverholders, Managing Agents should outline the actions they are required to undertake in respect of claims investigation/handling of MEDI claims. The TPAs and Coverholders should also seek to established mechanisms for the identification of Medicare claimants on bordereaux, and the gathering of the necessary information for the CMS reporting process. Claims agreement parties need to ensure that claims investigations on all current open and all new US liability claims are structured in such a way to identify the Medicare status of claimants.

For more guidance on this matter please contact Lloyd's International Trading Advice (''LITA'') on 0207 327 6677 or email LITA@lloyds.com.


Last updated on 27 Jan 2010