The Purpose of A Medicare Set-Aside Trust in A Workers’ Compensation Claim

The purpose of the Medicare Set-Aside trust (MSA) is to provide funds to the injured party to pay for future medical expenses that would be otherwise covered by Medicare.  Medicare’s position is that of a secondary payer in cases where the primary payment responsibility for paying medical costs rests with another entity, such as a workers’ compensation insurance carrier or liability insurer. Workers’ compensation is the primary payer to the individual for work-related injuries or illnesses.  Once the medical expenses are exhausted in the MSA, Medicare will pay for allowable expenses in excess of the properly exhausted MSA funds.  By establishing a MSA, parties to a settlement are protecting Medicare’s interest and complying with the Medicare Secondary Payer Act.  

Workers’ Compensation MSA Thresholds

Within the workers’ compensation arena, a MSA may be necessary once a workers’ compensation claim is resolved through settlement. The Centers for Medicare and Medicaid Services (CMS) have established thresholds to adequately determine whether its interest is protected.  While parties may submit a MSA to CMS for review and approval, CMS will only review a MSA that meets the following threshold requirements:

  1. The Claimant is a Medicare beneficiary and the total settlement amount is greater than $25,000.00; or
  2. The Claimant has a reasonable expectation of Medicare enrollment within 30 months of the settlement date and the anticipated total settlement amount for future medical expenses and disability or lost wages over the life or duration of the settlement agreement is expected to be greater than $250,000.00.  

It is also essential to note that while CMS will not review a MSA in a workers’ compensation claim if the threshold is not met, Medicare beneficiaries must still consider Medicare’s interests in workers’ compensation claims.  Medicare must remain the secondary payer.  


If you have any questions or concerns as to whether your workers’ compensation claim settlement meets the thresholds for a MSA, contact The Campbell Law Practice, LLC for a free consultation.  The Campbell Law Practice, LLC specializes in workers’ compensation for the injured workers. The Campbell Law Practice, LLC is located in Atlanta, Georgia, but accepts cases throughout the state of Georgia.