Friday, March 20, 2009

Medicare Advantage and Lien Enforcement

Posted by Matthew Garretson and Elizabeth Vish Schad

Do Medicare Advantage Payers have same rights in terms of lien enforcement as does Traditional Medicare (Part A and B)? In other words, are they absolved from notification and statute of limitations as Traditional Medicare is?

I represent a quasi state entity that serves the role of an excess insurer in medical malpractice cases (two tier cap, the first being satisfied by the physician and the second tier being satisfied by this quasi state entity). Is that entity an RRE?

-Recent Seminar Attendee

Part C plans differ from traditional Medicare in some important ways. First, while Part C plans are given the same recovery rights as traditional Medicare, there is no affirmative statutory lien created for Part C plans. Rather, the applicable statutes and regulations state only that Part C plans “may” assert a recovery right. This is different from the MSP statute (42 USC 1395y), which grants traditional Medicare an automatic statutory interest in third-party liability cases.
Also, Medicare must be given affirmative notice of a third-party liability claim or settlement. There is no requirement under the MSP statute that Part C plans be given similar notice. However, the contract language of the individual plan may. Thus, while Part C plans have the same enforcement rights as Medicare, the rules governing the notice and assertion of a lien are much more akin to those governing private liens.

Another key distinction exists which affects the way Part C claims can be identified and addressed. Medicare’s recovery arm, CMS, maintains records on all third-party liability cases involving traditional Medicare recipients. However, CMS does not maintain similar record for Part C recipients. As such, there is no single source through which to verify coverage, payments, and reimbursement rights.