Thursday, August 30, 2007

Med Mal / Medicare

Posted by Matthew Garretson

I have a 73-year-old client who was rear-ended in a motor vehicle accident. He eventually has a Lumbar Laminectomy; his insurance co-tenders UM policy limits of $100,000 prior to any suit being filed. No BI available. His total medical bills are $148,000. Can he submit medical bills to Medicare that exceeded his available UM policy limits? At this point, no bills have been submitted to Medicare, all his medicals are on LOP's.

-Florida Attorney

Absolutely. A client's personal insurance is considered primary to Medicare. Both underinsured motorist and uninsured motorist are included in the definition of liability insurance for Medicare reimbursement purposes. If the limits of the UM policy have been tapped, Medicare would now be primary.

Keep in mind however that some Medicare providers have up to 27 months to submit bills to Medicare for payment. So, if some of those providers submit their bills to Medicare and Medicare pays (even after the UM policy limits are tendered), Medicare would have reimbursement claims for services that they paid for that occurred between date of injury and date of tender of UM.

Hope this info helps.

Friday, August 3, 2007

Medicare Compromise

Posted by Mary Skinner, Matthew Garretson

Matthew - You have been very helpful in your posts about Medicare, and I wonder if I might ask your input on a matter I am handling. I have a case with serious injuries and serious liability problems. I have a firm offer and want to ask Medicare to compromise. I don't think a full waiver is likely (the offer is $500K and the Medicare payments are about $148K). What is the process for asking for compromise (i.e., whom do I contact and what information do they need?)? Also, are they doing anything at this point in auto cases on future set asides? I have heard they really are only doing them in [workers compensation] at this point. My [client] has no plans for future care at this point, and it seems doctors have done what they can. Thanks for any pointers or info you can provide.

-Minnesota Attorney

In those situations where a beneficiary has received a firm binding settlement offer, Medicare may enter into pre-settlement discussions regarding compromise of Medicare's claim against that firm binding settlement offer. A beneficiary has no further appeal rights if CMS and the beneficiary agree to a compromise. Mary Skinner, our manager of Medicare services may be able to provide you with information regarding the forms and contact info for requesting compromise.

With respect to set asides, you are correct; they are generally only required in WC settings. It is a very rare fact pattern wherein I would suggest a set aside for a liability case. You can find further detail in an article I recently published, Medicare’s Reimbursement Claim — The Only Constant Is Change. Hope this info helps.

-Matt Garretson

All pre-settlement compromise requests must be in writing and sent to the MSPRC (Medicare Contractor), they will forward your request to the CMS Regional office. However, due to the backlog that the MSPRC is currently in, I recommend that you also send your request directly to the Regional Office for the state that your client lives in. I will provide you with the address of the regional office where you need to send the request if you provide me with the state that your client resides in.

When submitting your request, craft a compelling story. Provide them with the facts of the case, the injuries your client sustained, the effect the injuries have had on your client financially (out of pocket expenses, such as non-covered medicals, home renovations, etc.) and their quality of life prior to the injury and after. Also, advise them what your client would use the settlement proceeds for should they compromise their lien. Medicare believes strongly in equity for equity, so if you were to reduce your fee or absorb some of the case expenses Medicare would look more favorably on your compromise request. If possible, provide any evidentiary documentation to support your request. Should you have any questions regarding the above information please contact me.

-Mary Skinner

Thursday, August 2, 2007

Priority Among Liens

Posted by Matthew Garretson

Is there priority among liens? For example, if there is an ERISA "lien" and a federal (military) lien, is there priority among the liens? Our client switched insurance during treatment and has these two liens and a state hospital (statutory) lien. It would seem that the statutory liens take priority over the contractual or ERISA lien. Any thoughts?

-Arizona Attorney

The following statement, recently made by the Texas Supreme Court in the context of an ERISA lien dispute, is a concise illustration of the priority of liens:

“The three varieties of subrogation—equitable, contractual, and statutory—represent three separate and distinct rights that, while related, are independent of each other. Independent, however, does not mean co-equal. We generally adhere to the maxim that “equity follows the law,” which requires equitable doctrines to conform to contractual and statutory mandates, not the other way around. Where a valid contract prescribes particular remedies or imposes particular obligations, equity generally must yield unless the contract violates positive law or offends public policy.” See Fortis Benefits v. Cantu, — S.W.3d —-, 2007 WL 1861000 (Tex.) (Jun 29,2007).

Statutory liens – such as Medicare, Medicaid, or VA/military liens, should have first priority. Following this are contractual liens such as ERISA liens, which must be based upon contractual terms, so long as those terms do not run afoul of statutory language. After that are equitable liens (not in the context of Sereboff v. Mid Atlantic, which also uses the term to describe a contractual lien which meets the definition of “equitable relief”) founded not in contract or statute, but mere principles of equity.

In our practice, which heavily revolves around lien resolution, we have always taken the stance with ERISA lien holders that while their lien may be valid, it must take a back seat to statutory governmental liens held by Medicare and Medicaid. It has also generally been our practice that among statutory liens, Medicare and VA/military liens generally have first priority since they are federal, then Medicaid as pursued by the state government, and finally hospital liens which, although statutory, are also private and take a back seat to public funds.

I hope this information helps.

Wednesday, August 1, 2007

Medicare Lien Issue

Posted by Matthew Garretson

Matt- Just saw your very helpful posting on Medicare lien issues that seem to abound. Can you give me your opinion on whether Medicare will voluntarily reduce its lien if the parties agree that a portion of the medical bills are not related to the actual malpractice?

We have a case involving a perforated esophagus that would have required hospitalization and potentially one month worth of medical bills if the perforation was diagnosed timely.

The patient was diagnosed late and therefore became septic, suffered complications, an extended hospital stay of 4 four months and finally deceased. There's about $1 million in hospital bills.

How is it possible to get Medicare to recognize that a portion of the bills is not related to the negligence or that some portion of its lien should not be part of the case?

Thanks for your help.

-New Hampshire Attorney

As a starting, Medicare may claim a right of recovery based upon what was pled and what was released. Once you get the conditional payment, you would pull dates and diagnosis that fall outside of those "moving papers". I would make it easy on them - give them specific dates and ICD-9 codes that are related to the underlying/preexisting injury and should be removed as well as specific dates and ICD's related to complications and extended stay. If the Medicare contractor fails to get their head around the logic, you might have more success kicking it off the front-line case workers desk and on the desk of a waiver/compromise specialist. Then, pursue waiver based upon fair and equitable or out of pocket expenses (certainly you have a compelling story for either/both arguments).

Also, since the client died, keep in mind that Medicare's pot to target is limited by any allocation between the wrongful death and survivorship components... Medicare Secondary Payor rules (42 USC § 1395y(b)(2), 42 CFR §§ 411.24, 28) limit recovery to medical expenses incurred by the decedent. Medicare recovery does not extend to state-created rights for the decedent's family to recover for his or her wrongful death, unless your state statutes provide that medical expenses are recoverable by the beneficiaries as part of their claims under the state's wrongful death statute.

Hope this info helps.