For medicare statutory compliance
American Empire Surplus Lines Insurance Company (AESLIC), a member of the Great American Insurance Group, has launched an Errors and Omissions (E&O) liability insurance product for medicare statutory compliance.
The company said that this coverage addresses the exposures created by the passage of Section 111 of the Medicare/Medicaid and SCHIP Extension Act of 2007 (Extension Act). Beginning on January 1, 2010, Section 111 of the Extension Act requires liability and workers’ compensation insurers, including self insurers, to determine medicare status for all claimants and to report all claims involving a medicare beneficiary to federal Centers for Medicare and Medicaid Services (CMS) when those claims are paid.
According to AESLIC, Extension Act gives the CMS a right of action to sue primary payers for reimbursement of medical costs, even if the claims payments were made by a third party administrator, and regardless of whether the claims settlement was approved by a state court.
AESLIC’s medicare statutory compliance E&O coverage include targets a wide range of self insured entities; coverage is provided on a claims-made basis; various deductible levels can be offered; limits up to $5m are available.
Bob Nelson, president and chief operating officer of AESLIC, said: “Our new policy, which provides E&O coverage for Medicare Statutory Compliance, is designed to help all entities who choose to self-insure their workers’ compensation or third party liability exposures. The new Extension Act legislation has wide-ranging consequences to these employers, who may soon be confronted with demands from Medicare for reimbursement for claims they thought were settled.
“Under the new legislation, the Federal Government may be entitled to double damages in the event it institutes legal action for reimbursement from self-insurers or insurance companies. Additionally, self insurers also face federal fines of up to $1,000 per day for each claim they fail to properly report in a timely manner.