When to Make a Medicare Secondary Payment

40.5.2 - When to Make a Medicare Secondary Payment (Rev .11550; Issued: 08-12-22; Effective: 10-13-22; Implementation:10-13-22) After the conclusion of the bankruptcy or insolvency proceedings, Medicare secondary payments may be made if the: • Provider or physician/supplier has filed a claim with the receiver (i.e., the entity responsible for settling and/or paying the outstanding debts of the bankrupt or insolvent primary payer); • Payment made on behalf of the bankrupt or insolvent entity responsible for paying primary benefits is less than the amount of the charge and less than the amount Medicare would have paid as the primary payer; and • Provider, physician, or other supplier is not required to accept the payment as full discharge of the liability of the beneficiary (or estate) for the bill. The receiver determines the payments that can be made on behalf of the bankrupt or insolvent entity. The providers, physicians, and other suppliers receive any available primary payment from the receiver and can then file Medicare claims to obtain any appropriate secondary payments. After the Medicare secondary claims have been processed, any remaining liability (e.g., deductibles, coinsurance, and payment for noncovered services) of the beneficiary (or of a deceased beneficiary's estate) can be pursued by the providers, physicians, and other suppliers. However, they may not pursue collection from the beneficiary if a receiver orders that the allocated fractional payment must be accepted as full discharge of the entire bill. If circumstances dictate, CMS will advise A/B MACs and DME MACs by an official CMS instruction that it will coordinate the pursuit of the bankruptcy court's findings and communicate the results to them.