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Printed Date: 9/22/2015
Information about the primary insurer and primary payment are required for all Medicare Secondary Payer (MSP) claims. One important piece of information for MSP claims is the OTAF field. 'OTAF' is the acronym for Obligated to Accept as Payment in Full. In addition to OTAF information, Palmetto GBA must also receive this information about the primary insurance payment:
How to Calculate the OTAF Amount
The OTAF amount is equal to the amount of the primary payer's payment plus any patient responsibility
Without the correct OTAF amount, Palmetto GBA cannot make correct Medicare Secondary payments. This could result in the beneficiary being held liable for the entire billed amount.
The OTAF amount (when it exists) must be calculated and entered in Loop 2320, CN102 CN 101=09 for the claim level and Loop 2400, CN102 CN 101=09 for the line level for electronic claims. This will ensure the correct MSP reimbursement and prevent an overpayment.
Other tips for filing MSP claims:
Note: Currently, OTAF is not a requirement in accordance with the HIPAA implementation guide. Until OTAF is mandated as a billing requirement, we can only encourage you to submit this vital information. Remember, correct submission of OTAF information will decrease incorrect secondary claim payment processing and greatly decrease the number of resultant overpayments by the Medicare program. This will protect and preserve the Medicare Trust Fund.
CMS Regulation Reference: Publication 100-05, Chapter 3 (PDF, 477 KB)
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Last Updated: 02/12/2018