Medicare is entitled to reimbursement for any payments that are related to an injury that is otherwise covered by insurance, including self-insurance, because it operates as a “secondary payer.”
How Do Medicare Liens Work?
At the root of it all is the Medicare Secondary Payer (“MSP”) statute, section 1862(b) of the Social Security Act, 42 U.S.C. § 1395y(b). The purpose of this law was to make sure that sure Medicare was not paying for medical bills that should be paid by someone else. So the statute gives Medicare the right to claim proceeds from the defendant who is paying the plaintiff’s medical bills as a part of the damages in a settlement or verdict. The interest is where a defendant/insurer is liable for a recipient’s medical expenses.