Medicaid and Medicare Liens in Personal Injury Cases: What You Need to Know
Most personal injury attorneys representing clients who receive Medicaid or Medicare benefits likely encounter a complex and challenging issue: liens. A lien is a legal claim that a third party has on the settlement or judgment proceeds of your client's case. Medicaid and Medicare are government programs that provide health care coverage to low-income and elderly individuals, respectively. They have the right to recover the costs of medical services they paid for your client's injuries from the liable party or the insurance company. This means that they can assert a lien on your client's recovery and reduce the amount of compensation they receive.
According to the Centers for Medicare and Medicaid Services (CMS), there were about 75 million Medicaid beneficiaries and 62 million Medicare beneficiaries in 2019. The CMS also reported that it recovered about $4.3 billion in liens from personal injury cases in 2018. As you can see, Medicaid and Medicare liens are a significant and common issue that affects many personal injury cases. Therefore, it is essential for you to understand how to identify, negotiate, and satisfy these liens in order to protect your client's interests and comply with the law.
In this blog post, we will explain the basics of Medicaid and Medicare liens and provide some practical guidance on how to handle them effectively. We will cover the following topics:
- How to identify and notify Medicaid and Medicare liens
- How to negotiate and reduce Medicaid and Medicare liens
- How to finalize and satisfy Medicaid and Medicare liens
How to Identify and Notify Medicaid and Medicare Liens
The first step in dealing with Medicaid and Medicare liens is to identify whether your client is a beneficiary of either program and whether they have received any medical services related to their injuries that were paid by the program. You should ask your client to provide you with their beneficiary information, such as their name, date of birth, social security number, health insurance claim number, etc. You should also obtain their case information, such as the date of injury, the type of injury, the name of the liable party or the insurance company, etc. Additionally, you should obtain their consent to release their medical records and information to the government programs.
Once you have gathered this information, you should contact the relevant entities that administer the liens for Medicaid and Medicare. For Medicaid, this entity is usually the state agency that oversees the program in your jurisdiction. For Medicare, this entity is the Benefits Coordination and Recovery Contractor (BCRC) or the Medicare Secondary Payor Recovery Center (MSPRC). You should report your client's case to these entities as soon as possible and request a conditional payment letter. A conditional payment letter is a document that lists the amount of medical expenses that the government program has paid for your client's injuries as of a certain date. This amount is subject to change until the case is settled or adjudicated.
It is important to start this process early and stay organized throughout the case. You should keep track of all the correspondence and documentation you receive from the government programs and update them regularly on any changes or developments in your client's case. You should also verify that the information in the conditional payment letter is accurate and complete. If you fail to identify or notify the government programs of your client's case, you may face delays, penalties, or legal action.
How to Negotiate and Reduce Medicaid and Medicare Liens
The next step in dealing with Medicaid and Medicare liens is to negotiate and reduce the amount of liens claimed by the government programs. You may have some grounds to challenge or appeal the amount of liens based on legal or factual arguments. For example, you may argue that some of the medical services listed in the conditional payment letter are not related to your client's injuries or that they are unreasonable or unnecessary. You may also argue that some of the procurement costs incurred by your client, such as attorney fees or litigation expenses, should be deducted from the amount of liens.
To negotiate with the government programs, you should provide them with evidence and documentation to support your arguments, such as medical records, bills, invoices, receipts, etc. You should also communicate with them in a professional and courteous manner and be prepared to compromise if necessary. You may be able to reach an agreement with them on a reduced amount of liens before settling your client's case.
Alternatively, you may consider using a lien resolution service or a professional administrator to handle the liens for you. These are third-party companies that specialize in negotiating with government programs on behalf of personal injury attorneys and their clients. They may have more experience and expertise in this area than you do and may be able to achieve better results for your client. However, they also charge a fee for their services, which may reduce your client's net recovery.
How to Finalize and Satisfy Medicaid and Medicare Liens
The final step in dealing with Medicaid and Medicare liens is to finalize and satisfy them after settling your client's case. You should notify the government programs of the settlement amount and terms as soon as possible and request a final demand letter. A final demand letter is a document that states the final amount of liens that the government program is entitled to recover from your client's recovery. This amount may differ from the conditional payment letter due to changes in medical expenses or adjustments based on procurement costs or other factors.
You should pay the liens within the required time frame specified by the government programs, which is usually 60 days for Medicaid and 30 days for Medicare. You should also obtain a lien satisfaction letter or a waiver of recovery from them as proof that you have fulfilled your obligation. If you fail to repay the liens within the required time frame, you may incur interest charges, lawsuits, or loss of benefits for your client.
Medicaid and Medicare liens are a complex and challenging issue that affects many personal injury cases. They can reduce your client's compensation significantly if not handled properly. Therefore, it is essential for you to understand how to identify, notify, negotiate, and satisfy these liens effectively.
In this blog post, we have explained the basics of Medicaid and Medicare liens and provided some practical guidance on how to handle them effectively. We hope that this information will help you protect your client's interests and comply with the law.
If you have any questions or need any assistance with your personal injury cases, please contact us at Leitner Varughese Warywoda PLLC today. We are a team of experienced personal injury attorneys who have successfully handled many cases involving Medicaid and Medicare liens. We can help you achieve optimal results.