Attorney fees and Medicaid lien cap in North Carolina personal injury cases

Just had a great straight forward question about the interaction of Medicaid Liens, Attorney Fees, and medical provider liens pursuant to NCGS 44-49-50.

QUESTION:  Is Medicaid's lien capped at one third of liability proceeds received or half of what is left over after attorney's fees?  In other words, if I am pro-rating a Medicaid lien with 44-49 liens and my fee is 25%, are they still sharing a third or are they sharing 37.5%?

ANSWER:  Medicaid gets no more than 1/3 of the total settlement.  Your attorney fees are irrelevant to Medicaid's share.   The most Medicaid can get is 1/3 of the settlement, even if you charge only 1 dollar as a fee.
 
Medicaid will prorate with NCGS 44-49/50 liens within their 1/3 share.  But remember that paying the parorata share of the 44-49/50 liens does not extinguish the balance of the medical bill.  The client still owes the balance after the prorata share unless you negotiate a "final payment"  compromise with the mediacl provider.  44-49/50 simply act as as a way to get the lawyer out of the middle and get the provider some money before they have to turn to a collection action to get it.
 
The 1/3 (or Medicaid's portion thereof) DOES take care of Medicaid, in full.

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Chris Nichols

www.NicholsTrialLAw.com

Comments

[Catherine Flowers]

Fantastic job on the blog, Chris :) I'll be checking back in again! -Cat

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