Earlier this month the Centers for Medicare and Medicaid Services (CMS) released updated policy guidance surrounding the calculation of Total Payment Obligation to Claimant (TPOC) amounts, required to be reported by Responsible Reporting Entities (RREs) via Section 111, Mandatory Insurer Reporting.

A TPOC is defined as a settlement, judgment, award or other payment that is generally paid at one time or in one lump sum when resolving a claim in full or in part. The Non-Group Health Plan (NGHP) User Guide, Version 6.0, contains a new paragraph in chapter 3, section 6.4, stating that the following should be included in a TPOC calculation (but the Guide notes that this list is not exhaustive):

  • claim-related medical expenses
  • indemnity
  • attorney fees
  • Medicare Set-Aside (MSA) amounts
  • payout totals for annuities
  • settlement advances
  • lien payments
  • repayment of Medicare conditional payments; and
  • any amounts forgiven by the RRE

Section 6.5.1, was also updated under the “No medicals” bullet on page 6-21, to explain that “’indemnity-only’ settlements, which seek to compensate for non-medical damages, should not be reported. The critical variable to consider is whether or not a settlement releases or has the effect of releasing medicals. If it does, regardless of the allocation (or lack thereof), the settlement must be reported.” This not a new concept, but rather, adds emphasis to the long-standing position that RREs must report TPOCS that have the effect of releasing medicals, even if no medical claim has been made.

The following paragraph on page 6-22 reminds us that scheduled periodic payments associated with workers’ compensation or no-fault are not reportable TPOCs as long as ORM has been reported (and advises that under this fact pattern, ORM is implicitly assumed by the action of having paid the indemnity benefit, and should be reported). New for Version 6.0, “one-time ‘indemnity-only’ payment to compensate for lost wages” was added as a possibility in addition to the scheduled periodic indemnity payment scenario.

The final update for the NGHP User Guide 6.0, was to Chapter V, with an update to Appendix J:  No-Fault Excluded ICD-10 Diagnosis Codes Updated for FY 2021.

The full Section 111 NGHP User Guide is available under the Downloads Box found at: https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/Mandatory-Insurer-Reporting-For-Non-Group-Health-Plans/NGHP-User-Guide/NGHP-User-Guide

If you have questions concerning Section 111 Mandatory Insurer Reporting requirements, please contact our team at [email protected].