Page 7 - The Suffolk Lawyer - March 2021 - Vol. 36, No. 2

PERSONAL INJURY • SPECIAL SECTION • PERSONAL INJURY
A Plaintiff’s Primer for Medicare and Medicaid Liens
(Continued from front cover)
42 U.S.C. § 1395y(b)(8)(A-B) puts an affir-
mative reporting obligation on the insurance
carrier, Medicare can and will seek recovery
of those payments directly against the
Medicare beneficiary or even the benefici-
ary’s attorney. 42 CFR §411.24(g).
Because the beneficiary and their counsel
are liable to Medicare for repayment, it is
best to promptly notify Medicare of the
claim. This can be done by sending notifica-
tion to Medicare advising of the client’s
name, address, date of incident, social secu-
rity number and a list of injuries along with
a copy of the retainer agreement and a
Medicare-compliant authorization.
From there the attorney can track
Medicare’s “conditional payments” thier On-
line Portal www.cob.cms.hhs.gov/MSPRP/.
You can review the conditional payments
and dispute erroneous payments directly
through the portal.
At settlement, you must request a
Medicare final demand letter. Medicare will
review its ledger and issue a final amount
due. To request a final demand letter, you
will need to provide the amount of the set-
tlement, the attorney’s fee and the attorney’s
cost.
Medicare is obligated to reduce the lien.
Medicare’s statutory lien reduction formula is
articulated in 42 CFR §411.37. An easy way
to think of this is to add the costs and attor- Certain qualified individuals can obtain a quest an Ahlborn allocation hearing by filing
ney fee together, and then divide by the total
settlement – this will give you the percent-
age of the reduction of Medicare’s lien. In
cases were a reduction beyond the statutory
reduction is needed, counsel should request
an equitable reduction, prior to requesting a
final demand letter.
An individual qualifies for Medicaid based
on their limited income and/or assets. Most
Medicaid beneficiaries apply for Medicaid
through the New York State Department of
Health (Health Exchange). You should in-
quire with your client whether they receive
Medicaid benefits, or ask if their health in-
surance, procured through the exchange is
paid in part by the State. Your client may or
may not know the answer to this question,
so best practice would be to send a notifica-
tion of your personal injury case to HMS,
who is contracted with New York State to
handle third-party liability and recovery.
HMS’ general number is 1-877-331-1460.
MARCH 2021 EDITION www.scba.org • The Official Publication of the Suffolk County Bar Association • THE SUFFOLK LAWYER 7
By Michael J. Famiglietti
Once you file suit on behalf of a Medicaid issues. Arkansas Department of Health and
beneficiary, CPLR §306-c requires that notice Human Services v Ahlborn, 547 US 268
of the commencement of an action, be (2006). In Ahlborn, the state’s recovery was
served upon either the local public welfare limited to the percentage of its Medi-
social services district or the New York State c a i d lien equal to the percent-
Department of Health. age of Plaintiff’s recov-
This notice can be a letter but must in- ery compared with
clude the Plaintiff’s name, address and so- the full
cial security number, the date of
incident, and copy of the Summons
and Complaint. An affidavit of
Service of this notice
must be filed with the
County Clerk’s office.
Service of this no-
tice gives the Depart-
ment of Social
Services an opportu-
nity to serve a lien
against Plaintiff’s re-
covery on the com-
menced action. Social value
Services Law §104-b. This lien of her case. As
is not valid unless the lien is filed such, if the Plaintiff’s in-
the County Clerk’s Office. Medicaid juries are worth considerably more
beneficiaries and their attorneys are liable to than the settlement value, an equitable
Department of Social Services for failure to reduction to the lien is in order. Plaintiff’s at-
repay a validly served and filed Medicaid lien. torneys should outline their position Medi-
Social Services Law §104-b(5)(c). Once a caid requesting an Ahlborn reduction
lien is served, the attorney should request a including reported verdicts and settlements
ledger of charges and promptly dispute any showing the full case value. If Medicaid is
charges not related to your client’s case. unwilling to reduce, Plaintiff’s counsel can re-
State subsidized, private insurance policy an Order to Show Cause. Lugo v. Beth Isreal
through the Health Exchange. Medical Center, 13 Misc, 3d 681.
These monthly subsidy payments are Finally, you must inform your client that
known as capitation payments. Medicaid will their settlement may make them ineligible
seek reimbursement of these capitation pay- for need-based benefits from the Depart-
ments for those months in which your client ment of Social Services including Medicaid.
used the subsidized health insurance for in- All clients should sign a document indicating
juries claimed in your case. Consider these their understanding that their settlement
capitation payments as a pay-one-price, may make them ineligible to continue receiv-
monthly unlimited use Medicaid lien. Medi- ing these benefits. There are options a client
caid will not seek an itemized repayment of can pursue to protect their eligibility, includ-
every payment made to the beneficiary’s ing establishment of a supplemental needs
medical providers. trust.
You must give notice of the settlement to Michael J. Famiglietti
the Department of Social Services. Social Partner, Rosenberg & Gluck, LLP
Services Law §104-b(5)(a). The Department
will then issue final lien amount. §104-b(5)( Michael J. Famiglietti is a
b). Medicaid does not reduce its lien for at- partner with Rosenberg &
torneys’ fees and costs. Gluck, LLP. He specializes in
Plaintiff’s personal injury lit-
Medicaid must reduce its lien if the Plain- igation.
tiff was not fully compensated for their injury
due to a limited insurance policy or liability