By Steven G. Mehta


As you know, I have tried to keep you updated regarding the issues pertaining to Medicare.  Here is a copy of another article addressing a first of its kind lawsuit filed by Medicare against defendants.

The U.S. government’s first-of-its-kind lawsuit against all parties that settled a pollution liability case signals Medicare’s aggressive push to make sure it does not pay medical expenses when others are to be the primary sources of payment, observers say.

The suit filed Dec. 1, 2009, cites Medicare Secondary Payer provisions in federal law that allow Medicare to recover past and future medical expenses from all parties—insured and self-insured—involved in a liability claims award or settlement that includes Medicare-eligible individuals.

With the suit, “CMS basically let the insurance and self-insured world know, “This is an important issue for us (and) if you are resolving a case and you don’t tell us and somehow we are not collecting this money, we are going to come after you,’” said Roy Franco, director of risk management strategies for supermarket chain Safeway Inc. in Pleasanton, Calif.

Mr. Franco also is co-chairman of the steering committee for the Medicare Advocacy Recovery Coalition, a group formed in 2008 to advocate improvements in the Medicare Secondary Payer program.

The case breaks new ground because CMS simultaneously named insurers, settlement beneficiaries and plaintiffs attorneys all in one lawsuit, said John Williams, CEO and president of Bradenton, Fla.-based Gould & Lamb L.L.C., which specializes in complying with Medicare secondary payer and mandatory insurer reporting to CMS.

It serves notice that CMS will seek payments from defendants and plaintiffs in a liability settlement involving those eligible for Medicare, Mr. Williams said.

“What you can read into it is that Medicare is getting a lot more aggressive in their conditional payment rights of recovery and they are not going to pick one side vs. the other,” Mr. Williams said. “A lot of attorneys I talked to thought they were just going to go after the claimants or just go after the insurers. They are going to go after everybody. “

Mr. Franco said it is the first suit to his knowledge in which Medicare has sued insurers contributing to such a settlement.

The lawsuit brought in U.S. District Court for the Northern District of Alabama, caught many observers by surprise, because they assumed CMS would seek reimbursement only for future liability settlements, Mr. Franco said.

But the lawsuit seeks money from a $300 million global settlement reached in 2003 in a case that alleged injuries from exposure to polychlorinated biphenyls manufactured in Alabama.

“What we are seeing is CMS going back quite a few years here,” Mr. Franco said. MARC is seeking federal legislation that would place a three-year statute of limitations on claims brought by the government to recover under the Medicare Secondary Payer law.

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