When a settlement involves a current or future Medicare beneficiary, Medicare Set-Asides (MSAs) are more than a best practice. They’re a necessity. In 2025, regulatory shifts and updated cost benchmarks mean plaintiff attorneys must be even more vigilant in structuring settlements to protect both compliance and client benefits.
Why MSAs Matter in 2025
An MSA allocates a portion of settlement funds to cover future medical expenses related to the injury, ensuring Medicare isn’t billed until those funds are exhausted. The Centers for Medicare & Medicaid Services (CMS) has emphasized strict adherence to these rules; failure to do so can jeopardize your client’s Medicare coverage.
With medical inflation adjustments and increased CMS scrutiny, 2025 brings new considerations that could significantly impact case outcomes.
Key 2025 Medicare Set-Aside Updates
Rising healthcare costs mean MSAs are often larger this year. Underfunding the MSA can trigger compliance issues. Additionally, CMS now requires more detailed documentation of how MSA funds are spent, heightening the need for meticulous administration. Finally, while a quicker CMS review is welcome, it leaves less margin for error in preparing submissions.
Strategic Tips for Plaintiff Attorneys
- Engage Your Settlement Consultant Early: Sage partners with MSA experts who offer analysis to ensure settlement negotiations account for the true cost of future care.
- Consider Structuring MSA Funds: Funding MSAs with structured settlement annuities can reduce upfront costs and stretch the funds over time.
- Document Everything: Maintain detailed spending logs to satisfy CMS audits and protect your client’s benefits.
- Integrate with Other Planning Tools: Coordinate MSAs with special needs trusts and attorney fee deferrals for a well-rounded settlement plan.
Protect Your Medicare-Eligible Clients
In 2025, successful settlement planning means treating MSAs not as a compliance checkbox, but as a strategic asset. By staying ahead of new rules and integrating MSA planning into your negotiation process, you can safeguard your clients’ benefits.
Contact Sage Settlement Consulting today to learn how our experts can help you navigate every step of the Medicare Set-Aside process.