CMS Enhances WCMSA Data-Sharing with Medicare Part D Prescription Drug Plans
On November 19, 2025, the Centers for Medicare & Medicaid Services (“CMS”) announced upcoming enhanced data-sharing capabilities between CMS and Medicare Prescription Drug Plans (“Medicare Part D” or “Part D Plans”) for purposes of improved coordination of Medicare prescription drug benefits in instances where a Medicare beneficiary settles their workers’ compensation (“WC”) claim with a Workers’ Compensation Medicare Set-Aside (“WCMSA”).
The memorandum confirms that beginning February 2026, CMS will provide Part D Plans with WCMSA prescription drug information through a new Medicare Beneficiary Database Other Health Insurance Monthly (“MBDOHIMO”) file, which will include up to 12 National Drug Codes (“NDC Codes”), the funding structure of the WCMSA (i.e., lump sum or annuity), the WCMSA Case Control Number (assigned identifier for WCMSAs submitted to CMS for formal review and approval), and other additional data elements. The full list of data elements is available within the memorandum appendix.
When coordinating prescription drug benefits moving forward, in instances where Part D Plans receive WCMSA-related prescription drug information through the MBDOHIMO file, Part D plans may either:
Pay conditionally for the Medicare beneficiary’s prescription drug expenses, contact the WCMSA administrator to determine whether the Part D Plan is the primary payer or secondary payer, and seek reimbursement if the Part D Plan made the conditional payment as the secondary payer[i]; or
Utilize the information provided via the new MBDOHIMO file (specifically, the NDC information), assess whether the prescription drug(s) are perceivably related to the WCMSA, and decline to provide coverage (e.g., decline to make payment) if is determined that the prescription drug expenses are payable out of the WCMSA fund.
Sanderson Firm Commentary
By CMS’ own admission within the memorandum, CMS is “not yet able to transmit NDCs or other specific data on all existing WCMSAs.” While unclear, this suggests CMS will not share prescription drug information for WCMSAs which were not submitted to CMS for formal review and approval (e.g., non-submit Medicare Set-Asides). CMS collects certain WCMSA information for nearly all workers’ compensation settlements involving Medicare beneficiaries, but CMS’ requested WCMSA Total Payment Obligation to the Claimant (“TPOC”) reporting fields do not provide a breakdown for the medical treatment amount versus the prescription drug amount; CMS simply sees the total WCMSA value via the Section 111 TPOC reporting feed. Therefore, unless CMS mandates all WCMSAs involving Medicare beneficiaries be submitted to CMS for formal review and approval[ii] or CMS further expands Section 111 TPOC reporting to require Responsible Reporting Entities (“RREs”) to also report WCMSA medical treatment and prescription drug amounts, it does not appear CMS will be able to share WCMSA-related prescription drug information for all Medicare beneficiary WC settlements with Part D Plans. Furthermore, CMS is unable to share such data with Part D Plans in instances where the WCMSA was prepared for a non-Medicare beneficiary with a “reasonable expectation” of becoming Medicare eligible within 30 months because the data-sharing only applies for active Medicare beneficiaries.
Finally, with respect to Part D Plans’ new ability to coordinate benefits using the MBDOHIMO file, it will be interesting to monitor the reliability of this “alternative method.” Again, CMS (and by extension, the Part D Plans) will be unaware of the prescription drug amounts in instances where the WCMSA was never submitted to CMS or where a WCMSA applies to those claimants with a “reasonable expectation” status. So, for these files, Part D Plans are presumably unable to base coverage determinations off the MBDOHIMO file / use “alternative method.”
Arguably, for Part D Plans to actually use the MBDOHIMO file to make prescription drug coverage determinations for all Medicare beneficiaries, CMS may believe the logical next step would entail expanding Section 111 TPOC reporting to capture WCMSA medical treatment amounts and WCMSA prescription drug amounts; CMS would be incorrect.
Even though federal law compels Part D Plans to coordinate benefits (i.e., deny coverage for a Medicare beneficiary’s prescription drugs when the Part D Plan is a secondary payer), the reality is that this hardly ever truly occurs in practice. Currently, there is no fully reliable method for Part D Plans to be aware of their primary payer status. Part D Plans often receive cluttered data feeds from CMS, and incorrectly denying coverage to the Medicare beneficiary (the Part D Plan’s client) risks 1) frustrating the Medicare beneficiary into dropping their current Medicare Part D Plan for a competing Part D Plan, and 2) causing the Medicare beneficiary to lodge a formal complaint against the Part D Plan to CMS, which risks lowering the Part D Plan’s performance score (star-rating).[iii]
CMS’ attempt at resolving these issues through the new MBDOHIMO file may not be as beneficial as intended (and may actually work against Part D Plans) because NDC codes do not provide sufficient information to determine whether the Part D Plan is the primary or secondary payer. Here is a brief example:
A WCMSA is prepared and submitted to CMS for a Medicare beneficiary who is prescribed hydrocodone for their pain. The WCMSA is approved as-submitted to CMS without issue, the RRE’s Section 111 WCMSA TPOC reporting confirms the existence of the WCMSA and all relevant values, and CMS shares the MBDOHIMO file with the Medicare beneficiary’s Part D Plan (which includes NDC Code 47781-409-60 for 10 mg of extended releases hydrocodone). The Medicare beneficiary’s treatment changes such that 1 year after settlement, their physician begins prescribing oxycodone in place of hydrocodone. When the beneficiary fills their new prescription for oxycodone (with an entirely different NDC code), how will the Part D Plan be able to reliably determine that the oxycodone is, in fact, related to the WCMSA and should be covered rather than unfairly denying coverage to the Medicare beneficiary?
CMS’ changes are certainly intended in good faith, but the industry will soon learn whether this change only further complicates existing issues with Part D Plan benefit coordination.
If your organization has questions regarding this CMS memorandum or would like more information about Sanderson Firm’s Medicare Set-Asides, Section 111 reporting solutions, or conditional payment lien services, please contact us.
[i] This remains unchanged and is consistent with current CMS policy per Chapter 14, Section 50.12.1 of the Medicare Prescription Drug Benefit Manual (last updated September 2018). Please visit the Downloads section at the following link: https://www.cms.gov/medicare/coverage/prescription-drug-coverage-contracting/prescription-drug-benefit-manual.
[ii] This pathway is currently impractical given total WCMSA volume nationwide, which is why the $25,000 Medicare beneficiary and $250,000.00 reasonable expectation WCMSA submission thresholds exist today. Moreover, CMS’ ability to implement such a requirement would entail legal challenges as a matter of administrative and constitutional law.
[iii] https://www.cms.gov/newsroom/fact-sheets/2025-medicare-advantage-and-part-d-star-ratings.
