I 

116TH CONGRESS 

1ST SESSION H. R. 4161 

To amend title XVIII of the Social Security Act to provide for the application 

of Medicare secondary payer rules to certain workers’ compensation settlement agreements and qualified Medicare set-aside provisions. 

IN THE HOUSE OF REPRESENTATIVES 

AUGUST 2, 2019 

Mr. THOMPSON of California (for himself and Mr. HOLDING) introduced the 

following bill; which was referred to the Committee on Ways and Means, 

and in addition to the Committee on Energy and Commerce, for a period 

to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee 

concerned 

A BILL 

To amend title XVIII of the Social Security Act to provide 

for the application of Medicare secondary payer rules 

to certain workers’ compensation settlement agreements 

and qualified Medicare set-aside provisions. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Coordination Of Medi5 care Payments and Worker’s Compensation Act’’ or the 

6 ‘‘COMP Act’’. 


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1 SEC. 2. APPLICATION OF MEDICARE SECONDARY PAYER 

2 RULES TO CERTAIN WORKERS’ COMPENSA3 TION SETTLEMENT AGREEMENTS. 

4 (a) SECONDARY PAYER PROVISIONS FOR WORKERS’ 

5 COMPENSATION SETTLEMENT AGREEMENTS.—Section 

6 1862 of the Social Security Act (42 U.S.C. 1395y) is 

7 amended— 

8 (1) in subsection (b)(2)(A)(ii), by inserting 

9 ‘‘subject to subsection (p),’’ after ‘‘(ii)’’; and 

10 (2) by adding at the end the following new sub11 section: 

12 ‘‘(p) DEFINITIONS.—For purposes of this subsection 

13 and subsection (q): 

14 ‘‘(1) COMPROMISE AGREEMENT.—The term 

15 ‘compromise agreement’ means a workers’ com16 pensation settlement agreement that— 

17 ‘‘(A) applies to a workers’ compensation 

18 claim that is denied or contested, in whole or in 

19 part, by a workers’ compensation payer involved 

20 under the workers’ compensation law or plan 

21 applicable to the jurisdiction in which the 

22 agreement has been settled; and 

23 ‘‘(B) does not provide for a payment of the 

24 full amount of benefits sought or that may be 

25 payable under the workers’ compensation claim. 


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1 ‘‘(2) WORKERS’ COMPENSATION CLAIMANT.— 

2 The term ‘workers’ compensation claimant’ means a 

3 worker who— 

4 ‘‘(A) is or may be covered under a workers’ 

5 compensation law or plan; and 

6 ‘‘(B) submits a claim or accepts benefits 

7 under such law or plan for a work-related in8 jury or illness. 

9 ‘‘(3) WORKERS’ COMPENSATION LAW OR

10 PLAN.— 

11 ‘‘(A) IN GENERAL.—The term ‘workers’ 

12 compensation law or plan’ means a law or pro13 gram administered by a State or the United 

14 States to provide compensation to workers for 

15 a work-related injury or illness (or for disability 

16 or death caused by such an injury or illness), 

17 including the Longshore and Harbor Workers’ 

18 Compensation Act (33 U.S.C. 901–944, 948– 

19 950), chapter 81 of title 5, United States Code 

20 (known as the Federal Employees Compensa21 tion Act), the Black Lung Benefits Act (30 

22 U.S.C. 931 et seq.), and part C of title 4 of the 

23 Federal Coal Mine and Safety Act (30 U.S.C. 

24 901 et seq.), but not including the Act of April 

25 22, 1908 (45 U.S.C. 51 et seq.) (popularly reVerDate Sep 11 2014 00:52 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4161.IH H4161

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1 ferred to as the Federal Employer’s Liability 

2 Act). 

3 ‘‘(B) INCLUSION OF SIMILAR COMPENSA4 TION PLAN.—Such term includes a similar com5 pensation plan established by an employer that 

6 is funded by such employer or the insurance 

7 carrier of such employer to provide compensa8 tion to a worker of such employer for a work9 related injury or illness. 

10 ‘‘(4) WORKERS’ COMPENSATION PAYER.—The 

11 term ‘workers’ compensation payer’ means, with re12 spect to a workers’ compensation law or plan, a 

13 workers’ compensation insurer, self-insurer, em14 ployer, individual, or any other entity that is or may 

15 be liable for the payment of benefits to a workers’ 

16 compensation claimant pursuant to the workers’ 

17 compensation law or plan. 

18 ‘‘(5) WORKERS’ COMPENSATION SETTLEMENT

19 AGREEMENT.—The term ‘workers’ compensation set20 tlement agreement’ means an agreement, between a 

21 claimant and one or more workers’ compensation 

22 payers which— 

23 ‘‘(A) forecloses the possibility of future 

24 payment of some or all workers’ compensation 

25 benefits involved; and 


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1 ‘‘(B)(i) compensates the claimant for a 

2 work-related injury or illness as provided for by 

3 a workers’ compensation law or plan; or 

4 ‘‘(ii) eliminates cause for litigation involv5 ing issues in dispute between the claimant and 

6 payer.’’. 

7 (b) SATISFACTION OF SECONDARY PAYER OBLIGA8 TIONS.—Section 1862 of the Social Security Act (42 

9 U.S.C. 1395y), as amended by subsection (a), is further 

10 amended by adding at the end the following new sub11 section: 

12 ‘‘(q) TREATMENT OF MEDICARE SET-ASIDES UNDER

13 WORKERS’ COMPENSATION SETTLEMENT AGREE14 MENTS.— 

15 ‘‘(1) SATISFACTION OF SECONDARY PAYER OB16 LIGATIONS.— 

17 ‘‘(A) FULL SATISFACTION OF CLAIM OBLI18 GATIONS.— 

19 ‘‘(i) IN GENERAL.—If a workers’ com20 pensation settlement agreement, related to 

21 a claim of a workers’ compensation claim22 ant, includes a Medicare set-aside (as de23 fined in subparagraph (B)(i)), such set24 aside shall satisfy any obligation with re25 spect to payments reasonably expected to 


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1 be made under subsection (b)(2)(A)(ii) 

2 with respect to such claim. 

3 ‘‘(ii) RULE OF CONSTRUCTION.— 

4 Nothing in this section shall be construed 

5 as requiring the submission of a Medicare 

6 set-aside to the Secretary. 

7 ‘‘(B) MEDICARE SET-ASIDE AND MEDI8 CARE SET-ASIDE AMOUNT DEFINED.—For pur9 poses of this subsection: 

10 ‘‘(i) MEDICARE SET-ASIDE.—The 

11 term ‘Medicare set-aside’ means, with re12 spect to a workers’ compensation settle13 ment agreement, a provision in the agree14 ment that provides for a payment of a 

15 lump sum, annuity, a combination of a 

16 lump sum and an annuity, or other 

17 amount that is in full satisfaction of the 

18 obligation described in subparagraph (A) 

19 for items and services that the workers’ 

20 compensation claimant under the agree21 ment received or is reasonably expected to 

22 receive under the applicable workers’ com23 pensation law. 

24 ‘‘(ii) MEDICARE SET-ASIDE

25 AMOUNT.—The term ‘Medicare set-aside 


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1 amount’ means, with respect to a Medicare 

2 set-aside, the actual dollar amount pro3 vided for in clause (i). 

4 ‘‘(2) MEDICARE SET-ASIDE.— 

5 ‘‘(A) SATISFACTION OF MEDICARE SET6 ASIDE.—For purposes of this subsection, a 

7 Medicare set-aside meets Medicare secondary 

8 payer obligations if the Medicare set-aside 

9 amount reasonably takes into account the full 

10 payment obligation described in paragraph 

11 (1)(A), while meeting the requirements of sub12 paragraphs (B) and (C) and is determined 

13 based on the following: 

14 ‘‘(i) The illness or injury giving rise to 

15 the workers’ compensation claim involved. 

16 ‘‘(ii) The age and life expectancy of 

17 the claimant involved. 

18 ‘‘(iii) The reasonableness of and ne19 cessity for future medical expenses for 

20 treatment of the illness or injury involved. 

21 ‘‘(iv) The duration of and limitation 

22 on benefits payable under the workers’ 

23 compensation law or plan involved. 


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1 ‘‘(v) The regulations and case law rel2 evant to the State workers’ compensation 

3 law or plan involved. 

4 ‘‘(B) ITEMS AND SERVICES INCLUDED.—A 

5 Medicare set-aside— 

6 ‘‘(i) shall include payment for items 

7 and services that are covered and otherwise 

8 payable under this title as of the effective 

9 date of the workers’ compensation settle10 ment agreement and that are covered by 

11 the workers’ compensation law or plan; 

12 and 

13 ‘‘(ii) is not required to provide for 

14 payment for items and services that are 

15 not described in clause (i). 

16 ‘‘(C) PAYMENT REQUIREMENTS.— 

17 ‘‘(i) REQUIRED APPLICATION OF

18 WORKERS’ COMPENSATION LAW AND FEE

19 SCHEDULE.— 

20 ‘‘(I) IN GENERAL.—Except in the 

21 case of an optional direct payment of 

22 a Medicare set-aside made under 

23 paragraph (5)(A), the set-aside 

24 amount shall be based upon the pay25 ment amount for items and services 


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1 under the workers’ compensation law 

2 or plan and applicable fee schedule 

3 (effective as of the date of the agree4 ment). 

5 ‘‘(II) WORKERS’ COMPENSATION

6 FEE SCHEDULE DEFINED.—For pur7 poses of this subsection, the term 

8 ‘workers’ compensation fee schedule’ 

9 means, with respect to a workers’ 

10 compensation law or plan of a State 

11 or a similar plan applicable in a State, 

12 the schedule of payment amounts the 

13 State has established to pay providers 

14 for items and services furnished to 

15 workers who incur a work-related in16 jury or illness as defined under such 

17 law or plan (or in the absence of such 

18 a schedule, the applicable medical re19 imbursement rate under such law or 

20 plan). 

21 ‘‘(ii) OPTIONAL PROPORTIONAL AD22 JUSTMENT FOR COMPROMISE SETTLEMENT

23 AGREEMENTS.—In the case of a com24 promise settlement agreement, a claimant 

25 or workers’ compensation payer who is 


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1 party to the agreement may elect to cal2 culate the Medicare set-aside amount of 

3 the agreement by applying a percentage re4 duction to the Medicare set-aside amount 

5 for the total settlement amount that could 

6 have been payable under the applicable 

7 workers’ compensation law or similar plan 

8 involved had the denied, disputed, or con9 tested portion of the claim not been subject 

10 to a compromise agreement. The percent11 age reduction shall be equal to the denied, 

12 disputed, or contested percentage of such 

13 total settlement. Such election may be 

14 made by a party to the agreement only 

15 with the written consent of the other party 

16 or parties to the agreement. 

17 ‘‘(3) OPTIONAL PROCESS FOR APPROVAL OF

18 MEDICARE SET-ASIDES.— 

19 ‘‘(A) OPTIONAL PRIOR APPROVAL BY SEC20 RETARY.—A party to a workers’ compensation 

21 settlement agreement that includes a Medicare 

22 set-aside may submit to the Secretary the Medi23 care set-aside amount for approval. 

24 ‘‘(B) NOTICE OF DETERMINATION OF AP25 PROVAL OR DISAPPROVAL.—Not later than 60 


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1 days after the date on which the Secretary re2 ceives a submission under subparagraph (A), 

3 the Secretary shall notify in writing the parties 

4 to the workers’ compensation settlement agree5 ment of the determination of approval or dis6 approval. If the determination disapproves such 

7 submission the Secretary shall include with 

8 such notification the specific reasons for the 

9 disapproval. 

10 ‘‘(4) APPEALS.— 

11 ‘‘(A) IN GENERAL.—A party to a workers’ 

12 compensation settlement agreement that is dis13 satisfied with a determination under paragraph 

14 (3)(B), upon filing a request for reconsideration 

15 with the Secretary not later than 60 days after 

16 the date of notice of such determination, shall 

17 be entitled to— 

18 ‘‘(i) reconsideration of the determina19 tion by the Secretary (with respect to such 

20 determination); 

21 ‘‘(ii) a hearing before an administra22 tive law judge thereon after such reconsid23 eration; and 

24 ‘‘(iii) judicial review of the Secretary’s 

25 final determination after such hearing. 


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1 ‘‘(5) ADMINISTRATION OF MEDICARE SET-ASIDE

2 PROVISIONS.— 

3 ‘‘(A) OPTIONAL DIRECT PAYMENT OF

4 MEDICARE SET-ASIDE AMOUNT.— 

5 ‘‘(i) ELECTION FOR DIRECT PAYMENT

6 OF MEDICARE SET-ASIDE AMOUNT.—Effec7 tive 30 days after the date of enactment of 

8 this subsection, with respect to a claim for 

9 which a workers’ compensation settlement 

10 agreement is or has been established, a 

11 claimant or workers’ compensation payer 

12 who is party to the agreement may elect, 

13 but is not required, to transfer to the Sec14 retary a direct payment of the Medicare 

15 set-aside amount. The parties involved may 

16 calculate the Medicare set-aside amount of 

17 such set-aside using any of the following 

18 methods: 

19 ‘‘(I) In the case of any Medicare 

20 set-aside of a compromise settlement 

21 agreement under paragraph (2)(C)(ii), 

22 the amount calculated in accordance 

23 with such paragraph. 

24 ‘‘(II) In the case of any Medicare 

25 set-aside, the amount based upon the 


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1 payment amount for items and serv2 ices under the workers’ compensation 

3 law or plan and fee schedule (effective 

4 as of the date of the agreement) in ac5 cordance with paragraph (2)(C)(i)(I). 

6 ‘‘(III) In the case of any Medi7 care set-aside, the payment amount 

8 applicable to the items and services 

9 under this title as in effect on the ef10 fective date of the agreement. 

11 Such transfer shall be made only upon 

12 written consent of the other party or par13 ties to the agreement. 

14 ‘‘(ii) ELECTION SATISFYING LIABIL15 ITY.—An election made under clause (i), 

16 with respect to a qualified Medicare set17 aside shall satisfy any payment, in relation 

18 to the underlying claim of the related 

19 workers’ compensation settlement agree20 ment, required under subsection (b)(2) to 

21 be made by the claimant or payer to the 

22 Secretary. 

23 ‘‘(B) ELECTION OF PROFESSIONAL OR

24 BENEFICIARY SELF ADMINISTRATION OF MEDI25 CARE SET-ASIDE PAYMENTS.—Nothing in this 


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1 subsection or subsection (p) prohibits an indi2 vidual from electing to utilize professional ad3 ministration services or to self-administer pay4 ments of their Medicare set-aside in accordance 

5 with existing law. 

6 ‘‘(6) TREATMENT OF STATE WORKERS’ COM7 PENSATION LAW.—For purposes of this subsection 

8 and subsection (p), if a workers’ compensation set9 tlement agreement is accepted, reviewed, approved, 

10 or otherwise finalized in accordance with the work11 ers’ compensation law of the jurisdiction in which 

12 such agreement will be effective, such acceptance, re13 view, approval, or other finalization shall be deemed 

14 final and conclusive as to any and all matters within 

15 the jurisdiction of the workers’ compensation law, 

16 including— 

17 ‘‘(A) the determination of reasonableness 

18 of the settlement value; 

19 ‘‘(B) any allocations of settlement funds; 

20 ‘‘(C) the projection of future indemnity or 

21 medical benefits that may be reasonably ex22 pected to be paid under the State workers’ com23 pensation law; and 

24 ‘‘(D) in the case of a compromise agree25 ment, the total amount that could have been 


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1 payable for a claim which is the subject of such 

2 agreement in accordance with paragraph 

3 (2)(C)(ii).’’. 

4 (c) CONFORMING AMENDMENTS.—Subsection (b) of 

5 such section is further amended— 

6 (1) in paragraph (2)(B)(ii), by striking ‘‘para7 graph (9)’’ and inserting ‘‘paragraph (9) and sub8 sections (p) and (q)’’; 

9 (2) in paragraph (2)(B)(iii)— 

10 (A) in the first sentence, by striking ‘‘In 

11 order to recover payment’’ and inserting ‘‘Sub12 ject to subsection (q), in order to recover pay13 ment’’; and 

14 (B) in the third sentence, by striking ‘‘In 

15 addition’’ and inserting ‘‘Subject to subsection 

16 (q), in addition’’; and 

17 (3) in paragraph (3)(A), by striking ‘‘There is 

18 established a private cause of action’’ and inserting 

19 ‘‘Subject to subsection (q), there is established a pri20 vate cause of action’’. 

21 (d) MODERNIZING TERMINOLOGY FOR PURPOSES OF

22 MEDICARE SECONDARY PAYER PROVISIONS.—Subsection 

23 (b)(2)(A) of such section is amended by striking ‘‘work24 men’s compensation law or plan’’ and inserting ‘‘workers’ 

25 compensation law or plan’’ each place it appears. 


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1 (e) LIMITATION ON LIABILITY.—The parties to a 

2 workers’ compensation settlement agreement which met 

3 the provisions of section 1862(b) of the Social Security 

4 Act (42 U.S.C. 1395y(b)) on the effective date of settle5 ment shall be accepted as meeting the requirements of 

6 such section notwithstanding changes in law, regulations, 

7 or administrative interpretation of such provisions after 

8 the effective date of such settlement. 

9 (f) EFFECTIVE DATE.—The amendments made by 

10 this section, unless otherwise specified, shall apply to a 

11 workers’ compensation settlement agreement with an ef12 fective date on or after January 1, 2020. 

Æ 


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