The Centers for Medicare and Medicaid Services (CMS) has postponed the implementation of new regulations requiring an employer to report to CMS any payment to a Medicare-eligible person, where that payment is for medical benefits or is in exchange for a release that waives claims for medical benefits. The new deadline recently announced by CMS requires that reports of covered payments must be submitted beginning in the first calendar quarter of 2011.

An employer that is fully or partially self-insured will be considered a “Responsible Reporting Entity” (RRE) and will be required to report payments to a person who is eligible for Medicare benefits, if the payments are for medical benefits or are in exchange for a release that has the effect of waiving claims for medical benefits. Where an RRE has assumed “Ongoing Responsibility for Medical Benefits” (ORMs), payments made on or after January 1, 2010, must be reported. Where the RRE makes a one-time or lump-sum payment to resolve all or part of a claim, which is referred to as a Total Payment Obligation to Claimant (TPOC), such payments occurring on or after October 1, 2010, must be reported. Without regard to whether the payment to be reported is an ORM or a TPOC, the RRE has until the first quarter of 2011 to submit its first report.

An RRE that fails to report covered payments will be subject to a civil penalty of $1,000 per day. Delaying the deadline to begin reporting will provide employers additional time to review the Section 111 regulations and begin the process of registration with CMS (if necessary). CMS cautions that RREs must begin the registration process a full calendar quarter before the obligation to submit reports arises. This period allows for testing of the technical elements of the reporting process. 

Note: This article was published in the March/April 2010 issue of The Employment Law Authority.

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