CALA CALA Medical Claims & Bodily Injury 2 — Questions and Answers
Question 1: What is a 'Medicare Set-Aside' (MSA) arrangement and when is it relevant to a bodily injury settlement?
- A fund set aside to cover future Medicare-eligible medical expenses related to the injury, required in certain workers' comp and liability settlements (Correct answer)
- A deduction from the settlement for Medicare premiums
- A separate insurance policy purchased by the claimant
- A lien filed by the hospital against the settlement
Correct answer: A fund set aside to cover future Medicare-eligible medical expenses related to the injury, required in certain workers' comp and liability settlements
An MSA is a financial arrangement that allocates a portion of a settlement to cover future medical costs for Medicare beneficiaries, protecting Medicare's interests.
Question 2: Under the Medicare Secondary Payer (MSP) Act, what obligation does an insurer have when settling a bodily injury claim?
- The insurer must reimburse Medicare for any conditional payments it made for injury-related treatment (Correct answer)
- The insurer must enroll the claimant in Medicare
- The insurer must pay Medicare before paying the claimant
- The insurer has no obligation to Medicare in liability claims
Correct answer: The insurer must reimburse Medicare for any conditional payments it made for injury-related treatment
The MSP Act requires liability insurers to satisfy Medicare's conditional payment lien before or at the time of settlement to avoid double-payment penalties.
Question 3: What is 'loss of consortium' as a component of a bodily injury claim?
- Damages claimed by a spouse for the loss of companionship and marital relations due to the injured party's condition (Correct answer)
- Loss of vehicle use during repairs
- Loss of income due to inability to work
- The injured claimant's loss of business profits
Correct answer: Damages claimed by a spouse for the loss of companionship and marital relations due to the injured party's condition
Loss of consortium is a derivative claim by the injured person's spouse for the deprivation of the benefits of their marital relationship caused by the injury.
Question 4: Which document best establishes a claimant's lost wages in a bodily injury claim?
- A wage verification letter from the employer and recent pay stubs (Correct answer)
- The claimant's verbal statement of income
- A personal bank account statement
- A tax return from five years prior
Correct answer: A wage verification letter from the employer and recent pay stubs
Employer-verified wage documentation and pay stubs provide contemporaneous, objective evidence of the claimant's earnings and time missed from work.
Question 5: What is the significance of a statute of limitations in a bodily injury claim?
- It sets the deadline by which a lawsuit must be filed or the claim is barred forever (Correct answer)
- It limits the amount the insurer must pay
- It restricts the number of medical providers the claimant can see
- It defines the policy period
Correct answer: It sets the deadline by which a lawsuit must be filed or the claim is barred forever
The statute of limitations is a legal deadline; failing to file suit within the prescribed period (typically 2-3 years for personal injury in most US states) permanently extinguishes the claimant's legal right to recover.
Question 6: When evaluating a bodily injury demand package, what does the adjuster assess to determine pre-existing conditions?
- Prior medical records, prior claims history, and any gap in treatment before the accident (Correct answer)
- The claimant's credit score
- The insured's driving record
- The age of the vehicle involved
Correct answer: Prior medical records, prior claims history, and any gap in treatment before the accident
Reviewing prior medical records and claims history helps identify conditions that pre-dated the accident, which may reduce the insurer's liability for aggravation versus new injury.
CALA CALA Medical Claims & Bodily Injury 2
What is a 'Medicare Set-Aside' (MSA) arrangement and when is it relevant to a bodily injury settlement?