RECENT COURT DECISIONS
Haro v. Sebelius
MARC Applauds Recent Arizona Court Decision
In this decision, the Arizona US District Court enjoins CMS from sending beneficiaries and their counsel a demand letter (known by the MSPRC as "rights and responsibilities letters") requiring repayment of contested or disputed MSP recovery amounts within 60 days without triggering exorbitant interest payments. As a result of this decision, the MSPRC has withdrawn the Rights and Responsibilities letter, and as of this writing is revising it to conform with the Court decision. The Court also makes numerous findings about the potential liability of plaintiff's counsel, ultimately finding that there is no way a Plaintiff's counsel can be liable to the government for repayment of a conditional payment obligation.
Portman v. Goodson
Portman v. Goodson, 2011 Lexis 19491 (W.D. Ky. Feb. 28, 2011): In this case Ms. Portman attempted to sue HHS to determine prior to settlement or judgment what her MSP repayment obligations would be. The court, however, threw out the case, finding that until the case was actually settled or decided Medicare was not secondary and therefore the claim against CMS was not ripe. The decision supports the need for legislation allowing CMS to provide a conditional payment amount before settlement.
Springs v. Healthcare Services
In Springs v. Healthcare Services, the court rejected jurisdiction over a MSP private cause of action claim because: (1) Medicare had yet to expend funds for the claimant's care; and (2) the claimant had failed to exhaust administrative remedies.
Hackley v. Garofalo
In this case, the Court refused to enforce a settlement agreement until a minor and his father provided social security numbers and other related information needed by the settling party to report the case under Section 111. The Court, following the Nebraska decision in Seger, found that there had been no meeting of the minds as to the terms of settlement, including disclosure of the confidential information, and therefore refused to require the settlement to proceed.
Geer v. AMEX Assurance
A federal district court dismissed without prejudice a private claim for double damages under the MSP citizen suit provision, filing the case untimely until underlying liability of the insurer is established, and remanded the case to state court absent any remaining federal questions.
Hixon v. HMS
A relator brought a False Claims Act action against the Iowa Medicaid contractor for submitting claims for federal funds for a Medicaid patient who was involved in a Malpractice liability suit. Iowa has a law prohibiting a jury from awarding medical costs if Medicaid or some other party has already paid for them, so the contractor did not pursue reimbursement for those expenses and submitted them as usual. The relator argued that by failing to seek reimbursement for treatment expenses related to the malpractice action, they essentially overbilled the Federal government and submitted a false claim. The Eighth Circuit dismissed on the grounds that the Medicaid Contract was reasonably interpreting the state statute.
Bradley v. Sebelius – 11th Circuit Case Pending
Bradley v. Sebelius Reply Brief
Bradley v. Sebelius Final Opinion
Decedent was a former resident of a nursing home and survived by his 10 children. The children filed a wrongful death claim against the nursing home for the loss of their father. Under Alabama law the Estate was also a claimant to collect damages related to the burial and past medical expense. The nursing home had a declining liability policy. In other words for every dollar spend on defending the claim, that value was deducted from the face value of the policy available to resolve the claim. The policy value was $60,000 and at the time a settlement decision was reach the value of policy was $52,500 which was paid in exchange for a release.
Ilse Theresa Jackson, Plaintiff-Appellant v. Hudson Court, LLC...
The Court rejected Jackson's request that it allocate settlement proceeds between MSP and non-MSP claims, to allocate everything to non-MSP payments due to the collateral source doctrine. Following established case law from Florida, the NJ Appellate Division held that the "collateral source" rule, which prohibits a plaintiff from recovering damages that they have already recovered from a collateral (or other) source, did not apply, and thus Jackson's settlement included amounts subject to MSP recoup by Medicare.
Garey E. Seger and Twila Seger v. United States District Court for the District of Nebraska
A recent case has required a beneficiary to produce social security and HICN information during discovery in litigation for purposes of a Responsible Reporting Entity's Section 111 reporting requirements.
Eugene Mason and Patrick Brown v. State Farm Mutual Insurance
In another of a long line of cases, the Utah district court rejected that an insurer, State Farm in this instance, violated the False Claims Act when it failed to reimburse the Medicare Trust Fund under MSP law after it originally contested coverage but later began to pay some claims. The Court found that there was no evidence that State Farm's actions were knowing or willful, and could not meet the elements of a False Claims Act claim. The plaintiffs did not assert a private right of action under the MSP statute.
Snook v. Oakland County Deputy Sheriffs
This case stands for the proposition that a settlement agreement will be enforced irrespective of whether the final Medicare Reimbursement Amount is determined unless the parties clearly state otherwise. In Snook v. Oakland County Deputy Sheriffs, et al., 2009 US Dist. LEXIS 75435 (U.S.D.MI, Southern Div., August 25, 2009), the plaintiff agreed to settle his assault and battery case for $75,000 but only if the Medicare Reimbursement Amount did not exceed $10,000. Read More
Vernon Hadden, Plantiff v. United States of America, Defendant
In this district court decision, an innocent pedestrian harmed in an automobile accident settled with the utility company that owned the truck involved in the accident. The settlement also made the pedestrian responsible for payment of MSP liabilities. When CMS demanded 100% of the MSP liability, which consumed most of the settlement, the pedestrian sought a reduction in the MSP payment based upon two arguments: comparative fault principles and the "made whole" doctrine. Read More
JACK WOODS, Plaintiff-Appellant, v. EMPIRE HEALTH CHOICE, INC., EMPIRE MEDICAL SERVICES, a division of EMPIRE HEALTH CHOICE ASSURANCE, INC.
Plaintiff-Appellant Jack Woods appeals from a judgment of the United States District Court for the Eastern District of New York (Irizarry, J.) dismissing for lack of standing his complaint asserting a cause of action under 42 U.S.C. § 1395y(b)(3)(A). Woods contends primarily that the District Court erred by determining that § 1395y(b)(3)(A) does not permit a private individual to assert a qui tam action on behalf of the Government. We conclude that 42 U.S.C. § 1395y(b)(3)(A) does not create a qui tam action, but rather merely enables a private party to bring an action to recover from a private insurer only where that private party has itself suffered an injury because a primary plan has failed to make a required payment to or on behalf of it.
Leggette v. B.V. Hedrick Gravel & Sand Company
In Leggette v. B.V. Hedrick Gravel & Sand Company, 2006 U.S. Dist. LEXIS 98297 (USDC North Carolina, 2006), plaintiffs commenced an action to recover health insurance benefits pursuant to the Employee Retirement Income Security Act ("ERISA") and the Medicare Secondary Payer Act ("MSP"). Plaintiff, Willie Leggette, suffered from End-Stage Renal Disease ("ERSD"). Read More