February 2022 Update

  • Bureau of Business & Economic Research Economic Outlook Seminar
  • CMS Webinar on WCMSA 2/17
  • MSIA Withdraws Opposition to IC Rule proposal
  • C.I. 121 Residential Property Tax Increase Limitations
  • AMA Guides Editorial Panel Meeting – 2/17
  • Welcome New MSIA Member - USI
  • Bureau of Business & Economic Research Economic Outlook Seminar

The Annual Economic Outlook Seminars (EOS) presented by the University of Montana Bureau of Business and Economic Research was held in late January and early February in the seven major cities and will be conducted in Lewistown on 3/15 and Havre on 3/16 EOS 2022 - Montana's Economic Outlook Seminar. The EOS is sponsored in part by MSIA members NorthWestern Energy and Sibayne Stillwater.

The focus this year was on housing and its impact on our economy and ability to hire and retain workers. With housing being short, some estimated by 6000 residences in Missoula alone, or being priced at what seem to be stratospheric numbers, the impact on Montana’s economy is noticeable. Spendable household income, extended locations (sprawl) for housing, reduced labor availability, particularly for lower and medium paying jobs, population growth and the impact on real estate wealth accumulation (the idea that your home provides a basis for a sound financial foundation for the family) are all impacted. How many employers have tried to retain someone – perhaps most acutely felt in the medical field – but the individual or family could not locate housing to meet their needs? 

As well, with all the stimulus money poured into the economy Montana’s economy has roared back – as has the nation’s economy. The activity has been so great, and again the impact of housing costs has brought inflation – a word we have not discussed in years. The result at the state level has been a huge year for state tax revenues along with earnings growth almost across the board in the Montana economy. The downs in the Montana economy are still the lag in Accommodations & Food – but tourism is very strong – and Mining. The seminar went though details about Montana’s economy in health care, ag, tourism, wood products, energy the high tech area and individual regional economies based on the cities visited. The details of the presentations is attached and available on the MSIA website, Montana Self Insurers' Association (, under Resources.

CMS Announces Webinar on new WCMSA Guidelines

For those of us not familiar with the acronyms – the Centers for Medicare and Medicaid Services (CMS) has announced a webinar for interested parties on Workers’ Compensation Medicare Set-Aside agreements (WCMSAs). WCMSAs are used to protect Medicare’s interest as a statutory secondary payer in settlement of workers’ compensation claims for future medical treatments that may be covered by Medicare.

With that out of the way, CMS has released a new Reference Guide for WCMSAs, There are certain circumstances where CMS does not have to approve the MSA as part of a workers’ compensation settlement contemplating future medical costs. In those situations, CMS seems now to be saying, if their perceived interests are not adequately covered in the settlement, they will deny payment for those medical treatments which would otherwise be assigned to them. The impact would be that the injured worker would have to pay for those medical services, presumably out of the settlement amount

The new Guide language, in part, states,

4.3 The Use of Non-CMS-Approved Products to Address Future Medical Care A number of industry products exist with the intent of indemnifying insurance carriers and CMS beneficiaries against future recovery for conditional payments made by CMS for settled injuries. Although not inclusive of all products covered under this section, these products are most commonly termed “evidence-based” or “non-submit.” 42 C.F.R. 411.46 specifically allows CMS to deny payment for treatment of work-related conditions if a settlement does not adequately protect the Medicare program’s interest. Unless a proposed amount is submitted, reviewed, and approved using the process described in this reference guide prior to settlement, CMS cannot be certain that the Medicare program’s interests are adequately protected. As such, CMS treats the WCMSA Reference Guide 7 use of non-CMS-approved products as a potential attempt to shift financial burden by improperly giving reasonable recognition to both medical expenses and income replacement.

As a matter of policy and practice, CMS will deny payment for medical services related to the WC injuries or illness requiring attestation of appropriate exhaustion equal to the total settlement less procurement costs before CMS will resume primary payment obligation for settled injuries or illnesses. This will result in the claimant needing to demonstrate complete exhaustion of the net settlement amount, rather than a CMS-approved WCMSA amount.

According to some industry experts, the new Guide does not create new policy but it identifies (for the first time) the idea that MSAs not approved by CMS which do not adequately consider Medicare’s interest in potential future medical treatment costs, will require demonstration that the settlement funds have been exhausted (presumably for medical care costs) before they will pay for those medical costs. Other experts contend the new Guideline language goes beyond the statutory limits of federal law, citing 42 CFR 411.46(d)(2) which provides the settling parties can carve out a piece of the settlement for future medical care costs. Their position is that CMS has the right to coordinate benefits up to the future medical care amount. 42 CFR 411.46(d)(2) states:

If the settlement agreement allocates certain amounts for specific future medical services, Medicare does not pay for those services until medical expenses related to the injury or disease equal to the amount of the lump-sum settlement allocated to future medical expenses.

The industry typically uses “evidence-based” or “non-submit” MSAs in those situations where they are not required to submit to CMS for prior approval. CMS has provided thresholds for MSA approvals within settlements to satisfy the Medicare as Secondary Payer laws. Submission or approval for MSAs that do not meet those thresholds remains voluntary. While submission provides something of a guarantee that the numbers are acceptable, there are few opportunities for appeal or review should CMS identify they disagree with the numbers and request/require more. It has been my experience that CMS, particularly for some future medical costs, over-inflates their potential expenses. I appreciate that predicting future medical costs is an interesting effort, but as an example, projecting current usage and dosage of opioids through to the end of life expectancy (which seems to be a typical CMS approach) may not be as medically appropriate as anticipating a reduction based on the potential for tapering or generic equivalents both which are reasonable and medically acceptable standards. 

CMS is hosting a webinar on February 17 at 1p EDT (11a MDT) on WC MSAs and the new Guideline language WCMSA Webinar Announcement. And here is the information, from that announcement regarding attendance:

CMS will be hosting a webinar to discuss a variety of WCMSA topics, including a summary of what’s new in Medicare set-asides, and addressing questions related to the inclusion of treatments, application of state rules, re-reviews/amended reviews and more. The webinar format will be opening remarks and a presentation by CMS followed by a live question and answer session with representatives from CMS.

Date: Thursday, February 17, 2022 Time: 1:00 PM ET Webinar URL:

Conference Dial In: 800-779-1251 Conference Passcode: 6930242

Please note that for this webinar you will need to access the webinar link and dial in using the information above to access the visual and audio portion of the presentation. Due to the number of participants please dial in at least 15 minutes prior to the start of the presentation. (emphasis added)

MSIA Withdraws Opposition to Independent Contractor Proposed Rule

As a result of the passage of SB 367, the Department of Labor had proposed rules in the fall to implement the language of the bill. In short, the expected intent of the legislation was to require the Department of Labor Employment Relations Division to review more of the individual situations when making a determination on either independent contractor (IC) or employee status. The Department had been using the Independent Contractor’s Exemption Certificate (ICEC) as a dispositive determining factor. If the person had a current and valid ICEC at the time of inquiry, they were deemed to be an IC. If they did not, they were deemed to be an employee. The new law required more – or so we thought.

The Economic Affairs Interim Committee (EAIC) stopped the proposed rule from going into effect at their November 2021 meeting. The bill’s sponsor, Senator Shane Morigeau (D-Missoula) recommended that action so those who had an interest had an greater opportunity to identify and work out the details of the issues.

Due to some technical issues with the specific language amended, it seems the law was not changed as fully expected to require more investigation. The intent was to provide those ICs with a valid ICEC at the time of hire, where it may have expired during the contract period, or those ICs who are not required to have the ICEC to operate some leeway in the determination of employee status as a result of further investigation. As a result of the technical issues, the proposed rules are not objectionable as proposed. MSIA can support the rules changes as proposed. However, the new law will likely have to be amended again, to completely address the issue. At that time, the rules will again have to be changed. We will be working with the Department and the legislature to make those changes. MSIA specifically thanks Quinlan O’Connor, Chief Legal Counsel for the Department of Labor for his help in identifying the issues and working with us to resolve them.

The EAIC at their meeting today (2/10) Senator Morigeau and the committee supported a proposal to allow the rules change to go into effect, and to work to create an Interim Committee bill to address the technical issues. The proposal had broad bi-partisan support. 

C.I. – 121 Residential Property Tax Increase Limitations

Constitutional Initiative 121 is a proposal to limit increases in residential property tax valuations to either 2% or the inflation rate (whichever is lower) for existing residential property with the same owners and no significant changes to the property since January 1, 2019, and sets the valuations at the level they were as of that date (pre-COVID and the significant price increases since then).

While the concept is awfully appealing – the proposal has drawn a broad and diverse coalition in opposition. The opponents identify that it will shift monies away from schools, law enforcement and all other local government expenditures. There is a diverse and interesting coalition which has formed to oppose the initiative including the Montana Chamber of Commerce, the MT AFL-CIO, the MT Farm Bureau, MT Farmers Union, the MT Contractors Association, the MT Federation of Public Employees, the MT Infrastructure Coalition, the MT Cattlemen’s Association and more. It has been my experience that when business and labor agree, as they do here, we should pay attention.

The EAIC heard public testimony on the proposal and will be communicating to the Revenue Interim Committee they heard no support for the proposal. Everyone who testified, including those mentioned above opposed the proposal as limiting local government options and requiring de-funding of the police, schools and other local entities, and shifting the tax burden to business, ranches, farms and other commercial operations, while benefitting those who purchased homes since January 1, 2019, which include many out-of-state individuals who have purchased at higher prices (see the BBER EOS report above).

AMA Guides Editorial Panel Meeting – 2/17 6p Central

The AMA has changed the way they do business and is opening up more of their deliberations and discussions to at least public viewing, if not participation. In that vein, they have announced the latest AMA Guides to the Evaluation of Impairments Editorial Panel meeting open to the public on February 17 starting at 6p (Central – 5p Mountain). Registration is required and more details can be found at AMA Guides® Editorial Panel Feb. 17, 2022 meeting | American Medical Association (

The Agenda AMA Guides® Editorial Panel virtual meeting, Feb. 17, 2022 ( seems to be centered on updating the PROMIS-29 functional assessment questionnaire. I have appreciated the opportunity in the past to work with two of the presenters representing the American Psychological Association, Dr. Kathryn Mueller and Dr. Daniel Bruns. Under Mueller’s leadership the Colorado Division of Workers Compensation implemented the 1991 reform law requirement of creating a workers’ compensation treatment guideline – among the first in the nation. That Guideline is the basis for the MT WC Treatment Guidelines. Mueller has also been active nationally on workers compensation medical issues Bruns has been a practicing Psychologist and involved with functional testing questionnaires research and results as they impact workers compensation claims outcomes. 

Welcome New MSIA Member - USI

USI is one of the largest insurance brokerage and consulting firms in the world, delivering property and casualty, employee benefits, personal risk, program and retirement solutions to large risk management clients, middle market companies, smaller firms and individuals. USI connects over 8,000 industry-leading professionals from approximately 200 offices to serve clients’ local, national and international needs and to custom-fit a risk management and employee benefit program that meets your needs. We have become a leader in the United States by doing things differently. We leverage our USI ONE Advantage®, an interactive platform that integrates proprietary and innovative client solutions, networked local resources and expertise, and enterprise-wide collaboration to deliver customized results with positive, bottom line impact. USI attracts best-in-class industry talent with a long history of deep and continuing investment in our local communities. We have developed specialty operations within each region based upon local niche demographics. Working together we can make a difference. For more information, visit

As always, if you need me, don’t hesitate to reach out. If you have ideas for the MSIA Update or know of breaking information for an MSIA Update Extra, please let me know!