CMS Section 111 changes, enforcement, and audits for workers’ comp settlements

Last year, the Centers for Medicare & Medicaid Services (CMS) made changes to its reporting rules under Section 111, specifically as they relate to Medicare set-asides (MSAs). Section 111 audits will begin next month related to the rule change that’s being enforced as of October 11, 2025, for applicable settlements from October 11, 2024, and forward. Here’s what employers and insurance companies need to know.

Section 111 rule changes—October 2024

Effective October 11, 2024, all workers’ compensation settlements that involved an injured worker who is or was on Medicare and settled out/closed future medical must be reported to the CMS, even if there’s a zero MSA or a non-submit MSA or they're below the review threshold.

The CMS makes it mandatory for self-insured employers and insurance companies to report when these two conditions are satisfied.

Section 111 reporting form changes—April 2025

Effective April 4, 2025, the Section 111 report to the CMS must include the MSA amount in addition to the date of settlement and total settlement amount.

Section 111 penalties enforced—October 2025