Fair Square Medicare Wordmark

What Happens to Unused Medicare Set-Aside Funds?

Medicare Set Aside funds stock image
By Daniel Petkevich
Jan 20, 2023

Your unused Medicare Set-Aside funds are never lost

Injuries can be a real pain, both physically and financially. But timely compensation can help cover your medical expenses and lessen the hit to your wallet.

Stay Up to Date on Medicare!

Join the Fair Square Medicare Newsletter to stay informed on cost savings, changes to Medicare, and other valuable healthcare information.
If you sustained an injury while at work and now qualify for Medicare, there are different rules and regulations to get medical coverage. Your medical expenses could include anything from doctor visits, follow-ups and tests to prescription drugs.
That's where a Medicare Set-Aside comes into play. As the name suggests, it’s a designated sum set aside to cover medical expenses related to an injury.

What's a Medicare Set-Aside?

If you suffer an injury or illness at work, your employer may provide financial compensation — known as worker’s compensation — to help pay your medical expenses and lost wages.
A Medicare Set-Aside (MSA), also known as a Worker's Compensation Medicare Set-Aside (

WCMSA

), is a fund drawn from your worker's compensation settlement for future medical expenses. The amount of the WCMSA depends on your particular case and can vary from person to person.
The MSA ensures that Medicare's interests are protected and that Medicare does not pay for medical expenses that should be the responsibility of the workers' compensation carrier or liability insurer.
MSAs are used in case of severe or long-term injuries or illnesses and can either be a lump sum or a structured settlement.

What's a Medicare Set-Aside Account?

A Medicare Set-Aside account, or WCMSA account, is a separate interest-bearing account where you allocate your worker's compensation fund for future medical expenses.
Interest from these funds must remain in the account and can only be used for medical expenses.
The funds from a settlement can be added to a WCMSA in one lump sum or through a structured settlement annuity that refills the account gradually over time.

When Do You Need a Medicare Set-Aside?

Medicare Set-Aside (MSA) isn't mandatory. However, it's used to set aside money from a settlement to pay for future medical expenses related to your work injury or illness. 
An MSA report, a document outlining injury-related expenses, can be made simpler by having a Medicare Set Aside (MSA) account in place. Since your MSA account funds are only used to cover your work-related injury expenses, it's easy to manage and report these expenses to Medicare.

Medicare

may review the allocation report, called the MSA report, if:
  • You're a Medicare beneficiary getting a worker's compensation settlement of more than $25,000.
  • You're receiving a worker's compensation settlement and will be eligible for Medicare within the next 30 months with a total settlement amount of more than $250,000.

Can I Use My Medicare Set-Aside Funds for Personal Expenses?

No.
Once you open a Medicare Set-Aside account, it can only be used to pay for medical expenses and prescription drugs related to the workers' compensation claim, i.e., those medical expenses resulting from the work injury. Medicare should cover these expenses otherwise.
Note that this applies even if you're not yet enrolled in Medicare.

What Happens When My Medicare Set-Aside Funds Are Exhausted?

If the funds in your Medicare Set-Aside (MSA) account are used up, Medicare will become the primary payer. Medicare will cover all the medical expenses related to your injury or illness, provided that you meet certain requirements.
Medicare will provide coverage only if:
  • You're a Medicare beneficiary
  • The MSA funds were used according to the Medicare guidelines
  • The MSA expenses were reported to Medicare
Medicare guidelines and regulations are complex, so it's a good idea to talk to a professional who can help you understand your policy benefits.
Getting professional help can assist with coordinating benefits, obtaining approvals, and monitoring funds to ensure compliance with Medicare regulations, heading off potential issues. This helps get your medical expenses covered after your MSA funds are depleted.
Once Medicare steps in, you'll be subject to the same co-pays, coinsurance, and deductibles as other Medicare beneficiaries for treatments related to your injury.

What Happens to the Unused Medicare Set-Aside Funds?

At the end of each year, unused funds are carried over to the next year.
If your worker compensation is deposited annually, you can use it together with Set-Aside funds carried over from the previous year for your medical expenses.

What Happens to the Unused Medicare Set Aside Funds in Case of Death?

In case of death, any unused funds in the Medicare Set-Aside account will be disbursed to a beneficiary(s) named in the settlement agreement after a waiting period of twelve months.
During this period, providers, physicians, and other suppliers can submit their bills to Medicare for reimbursement.
After the waiting period, the administrator will disburse any remaining funds to the designated beneficiaries.
Beneficiaries can include family, friends, or charitable organizations.

Access Medicare Benefits by Staying Compliant

A Medicare Set-Aside or WCMSA is a dedicated fund from your worker's compensation settlement that covers medical expenses related to a work injury. This means your worker's compensation is the primary payer for all medical expenses related to your work injury until funds in your WCMSA are depleted. At this point, Medicare becomes the primary payer. Compliance with federal guidelines and regulations is mandatory to access Medicare benefits.
The Medicare Set-Aside rules and regulations can be confusing, but it's necessary to comply with them to get benefits.
Contact our advisors at

Fair Square Medicare

if you have any questions or need clarification. You can also call us at 1-888-376-2028 for assistance understanding and managing your Medicare Set-Aside account.

Stay Up to Date on Medicare!

Join the Fair Square Medicare Newsletter to stay informed on cost savings, changes to Medicare, and other valuable healthcare information.

Recommended Articles

Cover image
How Can I Get a Replacement Medicare Card?
Aug 14, 2023
A doctor with a clipboard consults a female patient with cancer
Does Medicare Cover Inqovi?
Jan 11, 2023
Cover image
The Fair Square Bulletin: July 2023
Jul 17, 2023
Physiotherapist showing workout record on exercise bike
Does Medicare Cover Exercise Physiology?
Jan 11, 2023
Birthday stock image
What Is the Medicare Birthday Rule in Nevada?
Mar 28, 2023
male driver taking notes from behind the wheel stock image
Does Medicare Cover Driving Evaluations?
Dec 1, 2022
senior couple working in a greenhouse stock image
Medicare Supplement Plans for Low-Income Seniors
Mar 23, 2023
Doctor talking to patients are explaining the treatment of a patient's illness stock photo
How Much Does Rexulti Cost with Medicare?
Jan 24, 2023
Cover image
Does Medicare Cover Cold Laser Therapy (CLT)?
Jun 14, 2023
Cover image
Health Savings Accounts (HSAs) and Medicare
Apr 24, 2023
Cover image
The Fair Square Bulletin: October 2023
Oct 2, 2023
Illustrated referential images of a hospital bill, coins, cash in a wallet, a calculator, and a magnifying glass
What Are Medicare Part B Excess Charges?
Jan 6, 2023
Cover image
Can I Change My Primary Care Provider with an Advantage Plan?
Aug 25, 2023
Pre-Existing condition stock image
Can Medicare Advantage Plans Deny Coverage for Pre-Existing Conditions?
Mar 28, 2023
Leg bones and knees, 3d rendering. stock photo
Does Medicare Cover Tymlos?
Dec 5, 2022
a chart explaining different enrollment periods on medicare
How Do I Sign up for Medicare? A Simple How-To Guide For You
Apr 8, 2022
senior man pondering "which medigap plan should i choose" stock photo
Comparing All Medigap Plans | Chart Updated for 2023
Aug 1, 2022
Medigap and Medicare Advantage arrows stock image
Can I switch From Medicare Advantage to Medigap?
Sep 14, 2022

More of our articles

13 Best Ways for Seniors to Stay Active in Indianapolis

13 Best Ways for Seniors to Stay Active in Phoenix

14 Best Ways for Seniors to Stay Active in Nashville

14 Best Ways for Seniors to Stay Active in Washington, D.C.

20 Questions to Ask Your Medicare Agent

Can Doctors Choose Not to Accept Medicare?

Can I Laminate My Medicare Card?

Can Medicare Advantage Plans be Used Out of State?

Can Medicare Help with the Cost of Tyrvaya?

Do All Hospitals Accept Medicare Advantage Plans?

Do I Need Medicare If My Spouse Has Insurance?

Do You Need Medigap if You're Eligible for Both Medicare and Medicaid?

Does Medicare Cover a Spinal Cord Stimulator?

Does Medicare Cover Abortion Services?

Does Medicare Cover Air Purifiers?

Does Medicare Cover an FMT?

Does Medicare Cover Boniva?

Does Medicare Cover Chiropractic Visits?

Does Medicare Cover Diabetic Eye Exams?

Does Medicare Cover Disposable Underwear?

Does Medicare Cover Fosamax?

Does Medicare Cover Hoarding Cleanup?

Does Medicare cover Hyoscyamine?

Does Medicare Cover Hypnotherapy?

Does Medicare Cover Inspire for Sleep Apnea?

Does Medicare Cover Jakafi?

Does Medicare Cover Linx Surgery?

Does Medicare Cover LVAD Surgery?

Does Medicare Cover Macular Degeneration?

Does Medicare Cover Ofev?

Does Medicare Cover Orthodontic Care?

Does Medicare Cover Penile Implant Surgery?

Does Medicare Cover Qutenza?

Does Medicare Cover Robotic Surgery?

Does Medicare Cover RSV Vaccines?

Does Medicare Cover Service Animals?

Does Medicare Cover TENS Units?

Does Medicare Pay for Allergy Shots?

Does Medicare Pay for Antivenom?

Does Medicare Pay for Funeral Expenses?

Does Medicare pay for Opdivo?

Does Medicare Require a Referral for Audiology Exams?

Does Your Plan Include A Free Gym Membership?

Explaining the Different Enrollment Periods for Medicare

Fair Square Client Newsletter: AEP Edition

Finding the Best Dental Plans for Seniors

How Do Medigap Premiums Vary?

How Does the End of the COVID-19 Public Health Emergency Affect Your Medicare?

How Much Does a Medicare Coach Cost?

How Much Does Medicare Cost?

How Much Does Medicare Part B Cost in 2023?

How to Choose a Medigap Plan

Is HIFU Covered by Medicare?

Is the Shingles Vaccine Covered by Medicare?

Medicare Advantage Plans for Disabled People Under 65

Medicare Guaranteed Issue Rights by State

Seeing the Value in Fair Square

Should You Work With A Remote Medicare Agent?

The Fair Square Bulletin: June 2023

The Fair Square Bulletin: September 2023

Top 10 Physical Therapy Clinics in San Diego

Welcome to Fair Square's First Newsletter

What If I Don't Like My Plan?

What Is a Medicare Supplement SELECT Plan?

What Is Medical Underwriting for Medigap?

What is the Medicare ICEP?

What People Don't Realize About Medicare

When Can You Change Medicare Supplement Plans?

When to Choose Medicare Advantage over Medicare Supplement

Why Is Medicare So Confusing?

Will Medicare Cover Dental Implants?

Will Medicare Cover it?

Your Medicare One-Stop-Shop

Your guide to Medicare Parts A & B, Medicare Advantage, and Medigap. 100% free.
Get the Fair Square Bulletin

Medicare savings tips, helpful guides, and more.

About

Medicare 101

Current Clients

Medicare Supplement Plans

Medicare Advantage Plans

Fair Square 2023

Terms of Use
Notice of Privacy Practices

Virgil Insurance Agency, LLC (DBA Fair Square Medicare) and www.fairsquaremedicare.com are privately owned and operated by Help Button Inc. Medicare supplement insurance plans are not connected with or endorsed by the U.S. government or the federal Medicare program. This is a solicitation of insurance. A licensed agent/producer may contact you. Medicare Supplement insurance is available to those age 65 and older enrolled in Medicare Parts A and B and, in some states, to those under age 65 eligible for Medicare due to disability or End-Stage Renal disease. Virgil Insurance Agency is a licensed and certified representative of Medicare Advantage HMO, HMO SNP, PPO, PPO SNP and PFFS organizations and stand-alone PDP prescription drug plans. Each of the organizations we represent has a Medicare contract. Enrollment in any plan depends on contract renewal. The plans we represent do not discriminate on the basis of race, color, national origin, age, disability, or sex. Plan availability varies by region and state. For a complete list of available plans please contact 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week or consult www.medicare.gov. © 2022 Help Button Inc

We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.

MULTIPLAN_FairSquareMedicare_01062022_M