Medical Malpractice, Pennsylvania Medicaid

Posted by Matthew Garretson

Question:
We have mediation next week in an FTCA baby case pending in the Western District of Pennsylvania. I would like to discuss successful approaches with Pennsylvania Medicaid either in lien reduction or pouring the lien into a Special Needs Trust for repayment upon death or any other successful strategy. If you know anything that would be helpful I would appreciate a minute of your time.

-Washington D.C. Attorney

Answer:
After the Ahlborn decision last year, many states have scrambled to changes their legislative framework for dealing with liens. A couple months ago, Pennsylvania issued a policy statement which amends Title 55 of the Pennsylvania Code, Chapter 259. The statement explains how the Department will interpret and apply the requirements of 62 P.S. §1409(b) to be consistent with the Ahlborn decision. Pennsylvania believes their existing law is facially consistent with Ahlborn. Therefore, the statement of policy is to formally document the Department’s interpretation and establish procedures. The policy announces that §1409(b)(11), which limits the Department’s reimbursement to one-half of the beneficiary’s net recovery, is consistent with Ahlborn. Other parts of the statement seem to be directed at arguments presumably presented by attorneys to the Department in the aftermath of Ahlborn. Specifically, that the Medicaid “beneficiary generally recovers the Department’s expenses as part of his tort claim unless the Department chooses to intervene in an action of sue separately.” This statement precludes attorneys from arguing that medical expenses were not considered in the settlement, therefore, barring the Department’s recovery under Ahlborn. Additionally, the state has effectively inhibited “equitable apportionment” arguments. The policy asserts that under Pennsylvania law a settlement conclusively establishes the settlement as full compensation for damages. That is the full report as I know it.

Reimbursement Claim by Medicare Supplemental Carrier

Posted by Matthew Garretson

Question:
Matt - I very much appreciate your input on the AAJ list serves on the various reimbursement issues that plague us all. I was wondering if you have any insight on reimbursement claims by private insurers serving as Medicare supplemental coverage (part D?). I have a 99-year-old assisted living resident who was allowed to walk out of the facility unattended and fell and broke her hip and arm. Most of the bills for treatment have been paid by Kaiser Permanente under her supplemental coverage. They have a standard reimbursement provision in the summary plan description which I can easily get around under Georgia's anti-subrogation law. Question is does Kaiser get to piggyback on the Medicare regs so that I have to deal with them? Thanks for any insights.

-Georgia Attorney

Answer:
This is a big area of confusion and is a gray area. We have been seeking clarification directly from CMS on this issue, because it is clear that the Part C providers are not part of the federal agency system. However, I believe this (see below) is the position that Kaiser will take.

40 – Medicare Secondary Payer (MSP) Rules

(Rev. 76, Issued: 10-28-05, Effective Date: 10-28-05)

A state cannot take away an MA organization’s right under Federal law and the MSP regulations to bill, or to authorize providers and suppliers to bill, for services for which Medicare is not the primary payer. The MA organization may exercise the same rights to recover from a primary plan, entity, or individual that the Secretary exercises under the MSP regulations at 42 CFR Part 411, Subparts B through D.

I think that the anti-subro should apply to them b/c they are private entities. However, I haven't yet gotten CMS to concede the point.