Medicare Liens

Medicare liens are a topic of concern for most competent personal injury lawyers. It looks like Medicare is set to begin enforcing a federal law requiring reporting on injury claims made by individuals receiving Medicare.

Medicaid Liens in Personal Injury Cases

Medicaid is a government-funded health insurance plan for low-income families and individuals. Medicaid is jointly funded by both the federal and state governments but the program is administered at the state level.

When Medicaid pays for a beneficiary’s medical expenses resulting from an accident and the beneficiary brings a personal injury lawsuit, Medicaid is legally entitled to seek reimbursement for the cost of those medical expenses. In fact, under the federal Medicaid Act state programs are required seek reimbursement when a beneficiary gets a personal injury settlement or judgement. 42 U.S.C. §§ 1396(a)(25), 1396(k).

Medicare Reimbursement Law Can Be Confusing

The applicable law is somewhat ambiguous, however, as to whether Medicaid can go after all portions of a beneficiary’s settlement. In Arkansas Dept. of Health and Human Svcs. v. Ahlborn, 547 U.S. 268 (2006) the Supreme Court held that Medicaid could only go after the portion of a personal settlement that was compensation for medical expenses.

The decision in Ahlborn was not clear, however, whether this meant only past medical expenses or both past and future. Federal and state courts considering the issue have disagreed on whether Medicaid can go after settlement proceeds designated for “future” medical expenses. The Florida Supreme Court has previously held that Medicaid is NOT permitted to go after settlement proceeds designated for future medical care. Giraldo v. Agency for Health Care Admin., 248 So. 3d 53, 56 (Fla. 2018) .

You Have to Protect Medicare’s Interest

The key thing about this law for injury lawyers is that if you fail to protect Medicare’s interest, Medicare can go after anyone in the process to recover the payments made: the Medicare recipient, their personal injury lawyer, the defendant, the defense lawyer, or the defendant’s liability insurer. And let’s face it- we all know that the client and the defendant won’t have the money by the time Medicare comes looking. The feds are good at protecting themselves, and here they are doing it by putting a target on lawyers and insurers, which should not be a big problem as long as we are doing our jobs the right way.

Practical Thoughts on Medicare

Our practice at Miller & Zois is to discern early on in the client intake process whether the client is a Medicare recipient (or Medicaid, or state Medical Assistance). This lets us contact Medicare to put it on notice of the injury claim, and to request an itemization of the payments made by Medicare and a statement of Medicare’s claimed interest.

Most of this ultimately operates for the protection of the client. First, the billing for the treatment is at the lower, Medicare rate. Once we have Medicare’s itemization, we can make sure that the treatment listed is actually related to the case. It is not uncommon for a client who is in a car wreck and then suffers an unrelated injury a short time later, to have treatment for the second injury show up on a Medicare lien if the CPT codes for the treatment are similar. We also then have the opportunity to negotiate with Medicare to compromise the lien. Plus, if you don’t do this stuff, not only is the client looking at Medicare coming after them to get the money back, they may find themselves with no coverage, or their Social Security benefits could be docked to recover the payment.

These sorts of lien issues are always a concern because of the broad reach of Medicare’s right to repayment. I recommend that all lawyers do what they need to educate themselves on this issue, so they know the proper steps to take to protect their clients’ interest and avoid committing malpractice. It looks like Maryland is heading towards implementing a mandatory CLE requirement, which should help raise awareness in this area.