Comp and the Medicare Set-Aside Mary Bailey Feb. 4, 2006

As of January 1st, 2006, when the new Medicare prescription coverage took affect, your ability to settle your case has become much more expensive and difficult for those of us who have to take a lot of medications.

Why?

Because in the past when we settled our cases, the only thing Medicare dealt with was medical providers. It did not have to consider prescriptions because they were not covered under Medicare. The recent changes have included prescriptions/drug coverage.

Now the Medicare set-aside will be considerably higher.

For instance, in my case there was a Medicare set aside evaluation done a couple of years ago. If I had settled then, my Medicare set aside would have been $70,000 - $90,000.

Now, because of the drug coverage under Medicare, the Medicare set aside will be well over a $400,000.

We all know what piddly amounts the carriers come up with in their settlement offers. There is no way that there will be many carriers willing to settle with the Medicare set aside being so high.

I am not saying it will be impossible to settle. I am simply saying the settlements have now become much more difficult to settle.

Before the mandatory prescription drug coverage under Medicare, the Medicare set-aside did not have to consider the cost of prescriptions. It is estimated that in many of the PTD cases 2/3rds of the medical cost spent is spent on medications.

As you well know, the carriers are not going to increase the amount you settle for in most cases. That means that after attorney fees and the Medicare set-aside, there will be little money left. Although the Medicare set aside is your money, it is put in a trust for medical needs. Medicare personnel will release the money for medical needs only. You can't touch it.

With so much going to the Medicare set-aside, there will not be a whole lot left over for the injured worker to invest or live on.

If you plan to settle, please take this into consideration.

Additionally, it is my belief that this will be a nationwide problem.

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