Revealing Your Clients’ Medicare Advantage and Medicare Coverage and “Liens”

  As Medicare Advantage Organizations [MAOs] continue to gain ground in asserting recovery rights under the Secondary Payer Act [SPA], the impact of these efforts continues to cause significant barriers to resolving liability claims. A big part of that disconnect is the inability of the liability carriers to discover whether a Medicare beneficiary is on a MAO and if so, which one and for what time period. The same is true for a Medicare Beneficiary’s (aka Plaintiff/Claimant) coverage under a Medicare Part “D” prescription drug policy.
            Liability carriers have put into place policies and practices to meet their reporting requirements to CMS under the Medicare and Medicaid SCHIP Extension Act of 2007 (MMSEA). Basically, they report all liability claims by submitting to CMS the basic identifying information of the claimant, the nature of the claimed injures, [by ICD-10 Codes] name of counsel, etc. This information goes into the beneficiary’s common working file [CWF]. The MMSEA also allows liability carriers to query the system to find out if the claimant is enrolled in traditional Medicare coverage - “A” [hospitals] and “B” [doctors].  
            What the query does not report is whether the CMS beneficiary is or has been enrolled in a MAO or Medicare “D” plan. The result is liability claims being paid without the MAO and/or “D” plan’s “lien” for conditional payments being addressed and resolved. With CMS Beneficiaries moving between traditional Medicare, and different MAO and “D” plans over time, the task of identifying all potential liens with certainty is wholly dependent on the claimant’s record-keeping - which is often lacking. While liability carriers try to shift the ultimate liability for any such liens back on claimants through indemnity/hold harmless language in settlement documents, they remain the preferred target under the SPA and face a potential “double the lien” penalty. 

            A solution to the information void may be on the way with the Provide Accurate Information Directly Act (PAID) currently pending before both houses of Congress. [PAID ACT TEXT HERE]. The PAID Act would require CMS to include CMS beneficiaries’ insured status with MAOs and/or “D” Plans in the CWF data. Importantly, it will also allow counsel for the beneficiary to query the CWF and receive the same data as the liability carriers. Potential lien holders can be identified and contacted as part of the liability settlement process. This benefits all interested parties in an effort to reach settlements that fully resolve all issues. 

            While the PAID Act will help identify potential MAO and “D” plan lien holders, addressing those liens and getting them resolved as effectively as possible is a different task and certainly one that presents special challenges to the trial lawyer whose first goal is to maximize the recovery from the responsible party. These efforts must include an attempt to recovery the full special damages for the care from which the liens flow and that includes the costs of prescription drugs. 
            Effective resolution of the liens should start before the case/claim is settled, so that the realities of the claim/litigations process, such as liability issues, medical causation, limited policy limits and related factors can all be included in addressing the liens. Care must be taken not to pursue such efforts in a manner that creates arguments for the liability defendant to utilize if the case proceeds to trial -- this is often a driver for engaging The Lien Project to handle the lien issues.