Reading Room


Proposed CMS Legislation Cannot be Resuscitated Following the Wall Street Bailout

The efforts of the insurance industry to revive the previously fatally ill CMS reform legislation can be declared over and the life support disconnected following the Congressional actions to bailout Wall Street. The bill had been given a bounce, like a dead cat thrown against the ground, by the insurance industry, and some misinformed stakeholders, but economics and public opinion will not support the effort any longer.

The combination of the nationalization of AIG and the need for the US government to raise $700 Billion, makes it extremely doubtful that the Federal government is going to give the insurance industry another break other than to reinforce the country's need to insure banks and their spreadsheets.

CMS made it absolutely clear on a national teleconference on October 1st that it was holding workers’ compensation insurance carriers as sole Responsible Reporting Entities (RRE) and it wasn’t going to let them just walk away and re-delegate responsibility to others. CMS declared that workers’ compensation conditional medical payments remained a “pay and chase” proposition and that CMS was not allowing the responsibility of reporting to be shifted by the insurance industry.

The tightening of governmental scrutiny is now a predominate theme as the socialization of the insurance industry becomes more apparent and the existence of workers' compensation as a State based program becomes ever more threatened. Both sides of the political aisle are now being encouraged to look at insurance programs in a new light and make major adjustments as the economic viability of the country remains threatened. Giving the insurance industry another break by allowing them to shift responsibility back to CMS just isn't on the horizon and the idea can be finally buried.

Further Reading:

Wall Street Journal - Bailout

Nationalization of AIG

CMS Teleconference

Socialization of Industry

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