Highlights of the new Medicaid Subrogation lien statute after Wos v EMA Supreme Court Case

I'm a little late posting this new statute on my blog because I was so involved in getting the new Medicaid subrogation statute trimmed down and written in a way that it would be workable for trial lawyers.  These changes were the result of the US Supreme Court Ruling in Wos v EMA issued March 20, 2013.

The Governor signed the new bill incorporating the holding of Wos on July 18, 2013.  The bill is effective immediately.  You can view House Bill 982, in final mark-up version here:  House Bill 982 

Here are the things we KEPT in the old § 108A-57. Subrogation rights; withholding of information a misdemeanor:

  • Medicaid is still limited to a maximum of 100% of the lien OR One Third (1/3) of the gross settlement.
  • Medicaid still prorates within their 1/3 with unpaid medical providers asserting liens.
  • Payment by the lawyer of the 100% or 1/3 of the gross settelement is full and final payement of Medicaid's lien (but medical lien holders paid pro-rata still get are owed their balances pursuant to NCGS 44-49 and 50
Here are the NEW provisions that reflect the Supreme Court's determination that our previous Medicaid statute was in conflict with Federal law:
  • Medicaid recipients can challenge the 1/3 or 100% lien by filing a Petition with a court of competant jurisdiction for "a determination of the portion of the beneficiary's gross recovery that represents compensation for the Medicaid claim."
  • TIMING OF PETITION:  Those petitions must be filed within 30 days of all parties signing a settlement agreement OR court approval of the settlement OR a judgment being issued.
  • The Court will conduct an evidentiary hearing and may consider any factors it deems just and reasonable in determining the allocation of the settlement.
  • The burden of proof is on the petitioner to prove by "clear and convincing evidence" that Medicaid is demanding too large a portion of the settlement.

One other excellent part of the new statute says Medicaid can compromise the liens at any time:  

(a3) Notwithstanding the presumption arising pursuant to subsection (a1) of this section, the medical assistance beneficiary and the Department may reach an agreement on the portion of the recovery that represents compensation for the Medicaid claim. 

In the past, Medicaid took the position they could not negotiate their lien with recipients.  This new portion allows for that negotiation to occur at any time, even before a petition is filed.

Chris Nichols


www.NicholsTrialLaw.com 1.800.906.5984

Useful list of insurance company claims phone numbers

In NC, accident reports do not include the claims phone number for the liability insurance company. Here is a list of some claims phone numbers. Seriously think about calling a lawyer before you call the insurance company for the driver that hurt you.  Call the Nichols Law Firm.  The liability insurance company is NOT on your side..


Company Main claims number:
AIG Insurance Co. Personal: (800) 562-2208 Business: (877) 366-8423

Allied Mutual Insurance Co. (800) 282-9445

Allstate Insurance Co. (800) 386-6126

Amco Insurance Co. (800) 282-9445

American Casualty Co. (800) 437-8854

American Economy Insurance Co. (888) 557-5010

American Employers Insurance Co. In Mass.: (800) 284-6730Outside Mass.: (508) 549-9147

American Family Mutual Insurance Co. (800) 374-1111

American Home Assurance Co. Personal: (800) 562-2208 Business: (877) 366-8423

American International Ins Co. (800) 562-2208

American States Insurance Co. (888) 557-5010

Anthem Casualty Insurance Co. (800) 537-5568

Arbella Mutual Insurance Co. (617) 328-2800

Arkwright Mutual Insurance Co. (781) 890-9300 ext. 2502

Atlanta Casualty Co. (770) 447-8930

Atlantic Mutual Insurance Co. (800) 945-7461

Auto-Owners Insurance Co. (517) 323-1365

Berkshire Mutual Insurance Co. (800) 892-8877

Birmingham Fire Insurance of PA (877) 366-8423

Buckeye Union Insurance Co. (312) 822-5000

California State Auto Assn. Inter-Ins (800) 922-8228

Camden Fire Insurance Assn. (888) 421-2111

CIGNA Property & Casualty Ins Co. (215) 761-1000

Cincinnati Insurance Co. Call your agent

Citizens Insurance Co. of America (800) 628-0250

Colonial Penn Insurance Co. (800) 523-4040

Commerce & Industry Insurance Co. (877) 366-8423

Commerce Insurance Co. (800) 221-1605

Commercial Union Insurance Co. In Mass.: (800) 284-6730 Outside of Mass.: (508) 549-9147

Continental Casualty Co. (312) 822-5000

Continental Insurance Co. (312) 822-5000

Coregis Insurance Co. (312) 849-5000

Country Companies Insurance Group (800) 846-0100

CUMIS Insurance Society Inc (800) 637-2676

Dairyland Insurance Co. (715) 346-9200

Deerbrook Insurance Co. (800) 253-6611

DeSoto Insurance Co. (888) 823-9754

Explorer Insurance Co. In Calif.: (800) 788-8984 Outside Calif.: (858) 350-2400

Farmers Insurance Group of Cos. (888) 516-5656

Fidelity & Deposit Co. of MD (800) 854-6011

Fire Insurance Exchange (323) 964-8911

Firemens Insurance Co. of Newark NJ (312) 822-5000

Foremost Insurance Co. (800) 527-3907

GEICO Indemnity Co. (800) 841-3000

General Accident Ins. Co. of America (CGU) (888) 421-2111

General Casualty of WI (888) 737-8256

General Insurance Co. of America (206) 545-5841

Georgia Farm Bureau Mutual Insurance Co. (912) 474-8411

Government Employees Insurance Co. (800) 841-3000

Grange Mutual Casualty Co. (800) 445-3030

Great American Insurance Co. (800) 724-7722

Great West Casualty Co. (800) 228-8040

Hanover Insurance Co. (508) 855-8000

Harleysville Insurance Cos. (800) 892-8877

Hartford Accident & Indemnity Co. Personal: (800) 243-5860 Business: 1-800-327-3636

Hartford Casualty Insurance Co. Personal: (800) 243-5860 Business: 1-800-327-3636

Hartford Fire Insurance Co. Personal: (800) 243-5860 Business: 1-800-327-3636

Horace Mann Insurance Co. (800) 999-1030

Infinity Southern Insurance Co. (800) 334-1661

Indiana Farm Bureau Insurance (888) 392-5246

Insurance Co. of North America (215) 761-1000

Insurance Co. of the State of PA Personal: (800) 562-2208 Business: (877) 366-8423

Integon National Insurance Co. (800) 468-3466

Interinsurance Exchange Auto Club So. (714) 850-5111

John Deere Insurance Co. (800) 635-3377

Kemper Auto and Home 1-888-216-6066 Kemper Insurance Co.

Kentucky Farm Bureau Mutual Ins. Co. Call your agent Lexington Insurance Co. (877) 366-8423

Liberty Insurance Corp. (800) 526-1547

Liberty Mutual Fire Insurance Co. (800) 526-1547

Liberty Mutual Insurance Co. (800) 526-1547

Lumbermens Mutual Casualty Co. Call your agent Medical Liability Mutual Ins Co. (212) 576-9850

Mercury Insurance Group (800) 489-4001

Metropolitan Property & Casualty Co. (800) 854-6011

Mid-Century Insurance Co. (323) 964-8911

Motors Insurance Corp. (313) 556-4632

National Fire Ins. Co. of Hartford (312) 822-5000

National Indemnity Co (402) 536-3000

National Union Fire Ins.Pittsburgh Personal: (800) 562-2208 Business: (877) 366-8423

Nationwide Mutual Fire Insurance Co. (800) 421-3535

Nationwide Mutual Insurance Co. (800) 421-3535

New Hampshire Insurance Co. (877) 366-8423

New Jersey Manufacturers Ins. Co. (609) 883-1300

New York Casualty Insurance Co. (800) 892-8877

North Carolina Farm Bureau Mutual Ins. (919) 782-1705 ext. 8693

North River Insurance Co. In Mass.: (800) 284-6730 Outside of Mass.: (508) 549-9147

Northern Assurance Co. of America (617) 725-7033

Occidental Fire & Casualty Insurance Co. (800) 525-7486

Ohio Casualty Insurance Co. (513) 867-3000

Oklahoma Farmers Union Mutual Insurance Co. (800) 364-1511

Omni Insurance Co. (800) 727-OMNI (6664)

Pacific Employers Insurance Co. (215) 761-1000

Phoenix Insurance Co. (800) 252-4633

Preferred Risk Mutual Insurance Co. (515) 267-5299

Progressive Casualty Insurance Co. (800) 274-4499

Progressive Northern Insurance Co. (800) 274-4499

Progressive Northwestern Ins. Co. (800) 274-4499

Progressive Specialty Insurance Co. (800) 274-4499

Protection Mutual Insurance Co. (847) 825-4474

Reliance Insurance Co. (215) 761-1000

Republic Underwriters Insurance Co. (214) 559-1270

Rockingham Mutual Insurance Co. (800) 662-5246

Royal Insurance Co. of America (800) 842-1918

Safeco Insurance Co. of America (800) 332-3226

Scottsdale Insurance Co. (480) 948-0505

Selective Insurance Co. of America (973) 948-2900

Sentry Insurance a Mutual Co. (715) 346-9200

Shelter Mutual Insurance Co. (800) SHELTER

Southern United Fire Insurance Co. (800) 851-9476

Standard Fire Insurance Co. (800) 252-4633

State Farm Fire & Casualty Co. (888) 613-3966

State Farm Indemnity Co. (888) 613-3966

State Farm Mutual Automobile Ins. Co. (888) 613-3966

Travelers (860) 277-0111

Trinity Universal Insurance Co. (214) 360-8039

Twentieth Century Insurance Co. (800) 211-7283

United Services Automobile Assn. (800) 531-8222

United States Fire Insurance Co. (800) 690-5520

USAA Casualty Insurance Co. (800) 531-8222

Utica Mutual Insurance Co. (800) 695-1914 Vesta Fire Insurance Corp. (800) 444-3928

Westfield Insurance Co. (800) 443-3311

Windsor Group (800) 852-8220

Worcester Insurance Co. (800) 892-8877

Zenith Insurance Co. (800) 440-5020 

www.NicholsTrialLaw.com 1.800.906.5984

Useful link to Medicare and MSPRC billing and diagnostic codes for auditing conditional payment letters

I found this link with MSPRC's website and thought it might be helpful to some of you.  This link takes you to the PDF lists of all the Medicare diagnosis codes dating back to 2002.   http://www.cms.gov/Medicare/Coding/ICD9ProviderDiagnosticCodes/codes.html

You can download the pdf files and open them in Acrobat and then CTRL F search for the codes that show up on your conditional payment letters from Medicare.  This will help you sort out medical visits that have been "coded" for payment for non-related medical procedures and visits.
This makes it easier to find and eliminate appointments for pre-existing conditions.  You can also scan in a long conditional payment spread sheet, do a conversion to searchable text (OCR) and then use the search feature on that to find the billing codes.
Hope this is helpful to some of you.
Chris Nichols
www.NicholsTrialLaw.com 1.800.906.5984

Can a hospital seek a medical lien if the bills were submitted to workers compensation in NC?

I received a question by email and it is a good one so I'm going to post the question and the answer:

Can a medical provider claim a  lien under NCGS 44-49  if the medical bills have been paid by the workers compensation carrier prior to injured worker pursuing a third part claim against a tortfeasor?

Worker was injured, workers comp. paid his medical bills at the local hospital.  A case was pursued against the negligent third party and we just received a lien notification letter from the hospital.

Can they do this?

My answer:

No.  A workers compensation (WC) medical payment is a "payment in full."  The hospital submitted to WC, WC paid what is the allowable expense and the hospital has to write off the remainder.  They don't get to double bill or bill for the unpaid portion.

I would write the hospital a letter asking them to set out in writing what what the total charges are, what they have been paid in the past, and what they are asking from your client now.  


Get that in writing.  
The follow up with a letter to the department that claimed the lien and make sure you copy one of the Medical Dcotors in charge with the following laws:
A medical provider’s reimbursement is limited to the maximum amount approved in the NCIC Medical Fee Schedule, unless the provider has contracted with the insurer for a different amount. If neither the fee schedule nor a contractual fee applies, the maximum reimbursement allowed is the usual, customary, and reasonable charge for the service.
N.C.G.S. §97‐26(c)
N.C.G.S. §97‐90(e) governs this issue and states:
“A health care provider shall not pursue a private claim against an employee for all or part of the costs of medical treatment provided to the employee by the provider unless the employee’s claim or the treatment is finally adjudicated not to be compensable or the employee fails to request a hearing after denial of liability by the employer.”
N.C.G.S. §97‐88.3(c) establishes penalties for medical providers who improperly pursue private claims against employees:
“A health care provider who knowingly charges or otherwise holds an employee financially responsible for the cost of any services provided for a compensable injury under this Article is guilty of a Class 1 misdemeanor.”
That's straight out of the North Carolina Medical Society guide:  http://www.ncmedsoc.org/non_members/project_sustain/workerscomp_faq.pdf
I'm thinking that when faced with criminal liability, the hospital will about face on this one.
And of course, if  the bill was never submitted to or paid by WC, then I think they can claim a lien.  Though if they breached their duty to submit to WC, then they may just be completely out of luck.
Don't forget that WC does have a lien for the medical bills they paid.
Chris Nichols


www.NicholsTrialLaw.com 1.800.906.5984

One deposition taken in matter designated for arbitration may waive right to arbitration

In the matter of HCW, et al v HCW et al, the NC Court of Appeals has ruled that the taking of a deposition (utilization of discovery) in a matter where the legal dispute can be arbitrated works as a waiver of the arbitration process.

The HCW opinion

  "As a result, North Carolina’s
waiver-related jurisprudence generally establishes that, in the
event that a party makes material use of discovery procedures
available in ordinary civil litigation that are not available in
arbitration, that party has waived the right to insist that
claims that were addressed during the discovery process be
submitted to arbitration.

The record in this case clearly establishes that, during
the deposition of Plaintiff Drake, Defendants questioned him for
approximately one hour concerning the matters that underlie the
relevant claims. The questioning of Plaintiff Drake concerning
the claims which Defendants now seek to have arbitrated occupied
some 48 pages of the deposition transcript. During the course
of this portion of Plaintiff Drake’s deposition, Defendants
“prompted [Mr. Drake] to admit certain facts regarding the
[claims].” Capps, 184 N.C. App. at 272, 645 S.E.2d at 829.
Although the exact amount of monetary cost that Plaintiff Drake -24-
incurred during the portion of the deposition that addressed the
relevant claims is not spelled out in the record, the Supreme
Court’s description of the showing needed in order to establish
the right to arbitration by engaging in discovery does not
include a cost-related component. Servomation Corp., 316 N.C. at
544, 342 S.E.2d at 854 (stating that a waiver of the right to
have a claim submitted to arbitration can be waived if the party
seeking arbitration “makes use of judicial discovery procedures
not available in arbitration”).
Thus, we conclude that the
trial court’s determination that Defendants waived their right
to have the relevant claims submitted to arbitration by engaging
in discovery that would not have been available as a matter of
right during the arbitration process has adequate support in
both the trial court’s findings and the record..."

If you have a matter that has to be filed in court, you should immediately seek a stay of proceedings and an order for arbitration. Further, you should not engage in formal discovery and if your opposing party attempts to do so, you should seek an order of protection.

Chris Nichols


www.NicholsTrialLaw.com 1.800.906.5984

Trial: Priest joked about abusing 3 boys in week - Yahoo! News


Trial: Priest joked about abusing 3 boys in week

Associated PressBy MARYCLAIRE DALE | Associated Press – 17 hrs ago

PHILADELPHIA (AP) — Jurors in a landmark priest-abuse trial heard Monday about a priest-turned-camp prowler and another who allegedly bragged about having sex with three boys in one week.

Also Monday, two jurors were replaced by alternates, but a gag order prevents lawyer from discussing the reasons for the move.

Monsignor William Lynn is on trial for child endangerment and conspiracy. Lynn, 61, is the first Roman Catholic church official in the U.S. charged for his handling of priest-abuse complaints. Prosecutors say he helped the church bury them in secret files, far from the prying eyes of investigators, civil attorneys and concerned Catholics.

In the day's most startling testimony, a detective read internal church memos about a priest who allegedly "joked about how hard it was to have sex with three boys in one week." His accuser also stated that the priest had a "rotation process" of boys spending time sleeping with him.


Interestingly, North Carolina has no Statute of Limitation for criminal cases involving this type of sexual assualt.  Unfortunately, the general rule for civil cases is that the civil statute of limitations runs three years after the last date of sexual abuse.  If the abused person is a minor, the statute of limitations would begin to run when the minor reaches age 18, and expire 3 years later on the minor's birthday.

There is case law in NC for "recovered memory" cases, but the requirements  for this exception to the statute of limitations on sexual abuse require expert testimony and almost a complete lack of awareness of the abuse until the memory was recovered.


For more infomation on sexual abuse cases in North Carolina, you can go to http://www.nicholstriallaw.com/PracticeAreas/Sexual-Abuse-Injury-Litigation.asp

Chris Nichols



www.NicholsTrialLaw.com 1.800.906.5984

Oral argument audio from EMA v Cansler considering whether NC Medicaid liens comply with Ahlborn case

If you are interested in hearing how the 4th Circuit came to the decision in E.M.A. v Cansler, wherein the Court held that NC's Medicaid lien statute was not in compliance with the requirements for subrogation as set out in Ark. Dep't of Human Servs. v. Ahlborn, 547 U.S. 268 (2006) the audio link is posted below.  E.M.A. v Cansler now stands for the proposition that Plaintiffs in NC can ask for a Court to determine Medicaid's share of a personal injury settlement in a post-settlement hearing where the Court determines what percentage of the settlement is compensation for "medical costs incurred" and paid by Medicaid.  


The oral argument can be heard here:  http://coop.ca4.uscourts.gov/OAarchive/mp3/10-1865-20111026.mp3#


Chris Nichols


www.NicholsTrialLaw.com 1.800.906.5984

4th Circuit Court of Appeals upholds application of Ahlborn in NC- rejects reasoning of NC Supreme Court in Andrews


After about 7 years of multiple protracted litigation on three separate cases, the United States Court of Appeals for the 4th Circuit has established in the matter of E.M.A. v. CANSLER,  that Ark. Dep't of Human Servs. v. Ahlborn, 547 U.S. 268 (2006) is the law of North Carolina and that the NC Supreme Court opinion of Andrews v. Haygood did not properly interpret Ahlborn as it applies to NC Medicaid reimbursement.

Congratulations to Bill Bystrynski of Kirby & Holt of Raleigh, NC for the huge win for his client.

I'm going to keep this post fairly short and then add more posts with analysis, but I think the court puts their finding best.

Given that North Carolina common law does not bar DHHS’s lien against E.M.A.’s settlement proceeds, we arefaced with the same question considered by the North CarolinaSupreme Court in Andrews: Whether North Carolina’sthird-party liability statutes comport with federal Medicaidlaw and Ahlborn merely because the subrogation statute, N.C.Gen. Stat. § 108A-57, "caps" the state’s recovery at the lesserof the actual medical expenses paid or one-third of the totalsettlement. The North Carolina Supreme Court in Andrewsand the district court in this case adopted a narrow interpretationof Ahlborn, limiting its holding to cases in which the partieshave stipulated to or otherwise allocated settlementproceeds between different categories of damages, therebyidentifying a sum certain for medical expenses. Thus, thesedecisions are based on the view that Ahlborn is inapplicablein cases involving an unallocated lump-sum settlement, suchas the instant matter.On the contrary, however, nothing in Justice Stevens’sopinion for a unanimous court in Ahlborn supports such acrabbed application of that case. The Ahlborn Court addressedthe specific issue of "whether [ADHHS] can lay claim tomore than the portion of [the recipient’s] settlement that representsmedical expenses." 547 U.S. at 280.

The Court in no way rested its analysis of this issue on whether there has been a prior determination or stipulation as to the medical expensesportion of a Medicaid recipient’s settlement. Thus, Ahlborn isproperly understood to prohibit recovery by the state of morethan the amount of settlement proceeds representing paymentfor medical care already received. The North Carolina statute’sone-third cap on the state’s recovery against a Medicaidrecipient’s settlement proceeds does not satisfy Ahlborn insofaras it permits DHHS to assert a lien against settlement proceedsintended (or otherwise properly allocable) tocompensate the Medicaid recipient for other claims, such aspain and suffering or lost wages (i.e., in cases where one-thirdof the recipient’s total settlement recovery is greater than theamount DHHS expended on the recipient’s behalf).10 See Andrews, 669 S.E.2d at 607-09 (Hudson, J., dissenting) (concludingthat the North Carolina statutes conflict with federalMedicaid law by allowing the state to recover from a recipientfunds that were for purposes other than medical expenses);Andrews, 655 S.E.2d at 445 (Wynn, J., dissenting) (same).


We are not persuaded that a mere "reasonable cap" on astate’s recovery from an unallocated lump-sum settlement satisfiesthe federal anti-lien law as required by Ahlborn. Indeed,contrary to the Andrews court’s reliance on Justice Stevens’sfootnote, the ATLA Brief, rather than advocating full recoverysubject only to a statutory cap, discussed procedures inseveral states to have "mini-hearings" to set allocations ofproceeds from tort settlements where there is no agreementamong the interested parties. Nevertheless, the Supreme Courtof North Carolina found that footnote 18 in Ahlborn authorizesthe states to mandate full recovery up to a legislativelydetermined,across-the-board limit or cap. This reliance is misplaced.


On the basis of Ahlborn’s clear holding that the general anti-lien provision in federal Medicaid law prohibits a statefrom recovering any portion of a settlement or judgment not attributable to medical expenses, DHHS’s lien on E.M.A.’ssettlement proceeds in this case violates federal law. In order to comply with 42 U.S.C. §§ 1396a(a)(18), 1396p, and Ahlborn,North Carolina is free to implement a process by whichsettlement proceeds are explicitly allocated or otherwisedetermined. In this case, we must remand for an evidentiaryhearing consistent with this opinion to determine the properamount of the DHHS lien on E.M.A.’s settlement proceeds.

You can read the full opinion here:   Download F-Opinion


This is an outstanding opinion and reflects the excellent analysis of Judge Wynn and Judge Hudson on the NC cases of Ezell and Andrews.

I'll be writing a whole lot more on the issue, but wanted to get this out there.

I'm also proud that the 4th Circuit relied on a Memorandum issued by CMS to the states in their decision:

It is also illuminating that the Centers for Medicaid andMedicare Services ("CMS") issued a memorandum to all Associate Regional Administrators for Medicaid and State Operations in the wake of the Ahlborn decision to aid the states in understanding the effect the decision would have onstate third-party liability recovery. See Memorandum from Gale Arden, Director of CMS’s Center for Medicaid and StateOperations Disable and Elderly Health Programs Group(DEHPG) to all Associate Regional Administrators for Medicaidand State Operations, "State Options for RecoveryAgainst Liability Settlements in Light of U.S. Supreme CourtDecision in Arkansas Department of Human Services v. Ahlborn"(July 3, 2006) (hereafter "CMS Memorandum"). The CMS Memorandum stated that, post-Ahlborn, "if a State attempted to recover from more than the portion of a settlementthat the parties allocated to medical items and services,it was in violation of the federal anti-lien statute." Id. Additionally,the CMS Memorandum clarified that, "to the extent State laws permit recovery over and above what the partieshave appropriately designated as payment for medical itemsand services, the State was in violation of federal Medicaidlaws." Id.  (Page 32)

NCTrialLAw Blog was the first blog to find and publish Download CMS Advisory Ahlborn Settlement Options (July 2006)-1 after some deep searches on the Internet.  It was a sort of "smoking gun" that showed that CMS itself was telling the State of North Carolina that Ahlborn applied.

Chris Nichols


www.NicholsTrialLaw.com 1.800.906.5984

A brief "how to" for dealing with Medicare

I was sent this brief "idiot's guide" to dealing with Medicare and thought it was an excellent summary of the process.  I've posted it in full, along with the contact information for a company that will help with the lien resolution process.  I am not endorsing their product as I have never used their services.

-Chris Nichols


The Idiot’s Guide to Medicare Lien Resolution

Typically, Medicare liens are placed on the personal injury case of a person whose treatment is paid by Medicare.  Medicare’s agents, the COBC, MSPRC, and CMS have a right to recover funds which would not have been paid without the negligent act which harmed the plaintiff-beneficiary.

If you are the Medicare beneficiary and plaintiff in a lawsuit, your attorney should handle the Medicare liens for you.  If you are the attorney, but you don’t know how to handle the lien, or just need some help, follow these simple steps:

  1. Report the case to the COBC
    1. Call (800) 999-1118
    2. Be prepared to give the following Plaintiff/Beneficiary information:
      1. Name
      2. Social Security Number
      3. Medicare Number (a/k/a HIC Number)
      4. Date of Birth
      5. Address
      6. Date of Incident
      7. Injury (the COBC prefers physical body parts )
      8. Defense insurance (if known)
  2. This should be the only time you deal with the COBC
  3. Wait 10-15 days.  During this time period the COBC will transfer the file to the MSPRC, another Medicare agency.  At the end of this time period you should receive two (2) pieces of Medicare lien information from the MSPRC:
    1. First, you will receive a Beneficiary Information Questionnaire (you will recognize this document based on the red grid lines on the back pages).  This document can be ignored if, and only if, the plaintiff-beneficiary’s information has not changed.
    2. Concurrently, you will receive a Rights and Responsibilities Letter.  This will give some information on the Conditional Payment Letter process.  No action on your part is required.
      1. This Rights and Responsibilities Letter starts a countdown until you should receive a Conditional Payment Letter (a/k/a the initial lien).  That countdown will last 65 days – however, you need something else to receive the letter.
      2. Within the 65 day period, you need to send consent  and proof of representation to the MSPRC.  If you do not send the consent, you will not receive information on the Medicare lien, nor will you be able to speak to MSPRC representatives regarding your case.
        1. Unfortunately, the MSPRC is notoriously slow.  Without constant checks on the status and timeline, your Conditional Payment Letter probably won’t arrive within the 65 day period.
          1. Be sure to call the MSPRC to check the status of your consent (its validity).
          2. Be sure to call the MSPRC multiple times after to check the status of your Conditional Payment Letter.
          3. Please be ready to wait when you call theMSPRC.  Hold times range anywhere from 10 to 55 minutes (and increasing).  In fact, due to theMSPRC’s inability to handle current volumes of mail, its call center is now closed on Fridays.
  4. After all that time and effort you should receive the Conditional Payment Letter.
    1. But if you did not bother to call the MSPRC – you probably don’t have it!
    2. You’ve received the Conditional Payment Letter, now what?
      1. Review the payments.  Check every ICD-9 code and injury to make certain they relate to the plaintiff’s sued-for injuries.
        1. Hint: ICD-9 Code 250.00 (Diabetes Mellitus) usually does not relate to malpractice or a personal injury.
  5. On nearly every Conditional Payment Letter there will be unrelated codes – this means the lien is too high and Medicare is claiming funds to which it is not entitled.
  6. If you have time before settlement you should Dispute theConditional Payment Letter.
    1. The MSPRC requires these in writing.
    2. Dispute the codes that are unrelated and explain why the MSPRCwas wrong to include them.
    3. Be detailed.
    4. The MSPRC will take 60-90 days to review your dispute.  When it replies to your dispute it will not give reasons, it simply sends a new Conditional Payment Letter.
    5. The case is settled, how do I pay Medicare?
      1. First you have to request a Final Lien Demand by notifying theMSPRC of settlement.
        1. Be sure to include the settlement, attorneys fee, any costs incurred (plus an itemization), and the date of settlement.
        2. In 30-45 days you will receive a Final Lien Demand.  This is the amount you must pay to Medicare from the settlement proceeds.
          1. You have 60 days to repay the lien before interest accrues.
          2. If you fail to pay within 60 days the interest will accrue for all 60 days plus any additional time.
  7. Final Lien Demand is not really final:
    1. You can appeal the Final Lien Demand on the basis that unrelated payments are included in the lien.
      1. You must do so within 120 days.
      2. Be very careful and detailed when appealing.  Keep in mind the MSPRC is the judge, jury, and executioner at this point of the Medicare lien appeal.
    2. Other methods exist to lower the lien, including:
      1. Compromises with CMS.
      2. Waivers through the Social Security Administration.
      3. Now that I appealed, how does my client get aMedicare Lien Reimbursement?
        1. Medicare lien reimbursements (for “overpayment”) take 10-14 weeks to be processed and sent to your client.
        2. You don’t have to do anything once the appeal has been agreed to by the MSPRC.
          1. But the check will go straight to the last-known address for the beneficiary.
          2. If you want the check to go to your office you must contact the MSPRC and request it be sent to you.
            1. Usually this check arrives as a two-party check.
            2. This will protect the interests of all heirs who have an entitlement to the lawsuit funds.
            3. Now you can put the check into your escrow account and disburse the funds as is legal, ethical, and agreed to by the plaintiff, heirs, and secondary lienholders.
  8. Timelines:
    1. Reporting to COBC – Day 1
    2. COBC transfer to MSPRC – Day 3-5
    3. MSPRC sends Rights and Responsibilities letter, starting 65 day countdown to a Conditional Payment Summary, or Initial Medicare Lien – Day 15-20
    4. Conditional Payment Letter arrives – Day 80-85
    5. Disputes add 60-90 days
    6. Compromises add 60-90 days
    7. Appeals add 60-90 days
    8. Notice of settlement to receive Final Lien Demand
      1. Was 10-21 days
      2. Now is 30-45 days
      3. If you do everything right in Medicare Lien Resolution, you could resolve a lien within 110 days; but, if you let letters sit and do not take the time to carefully review and resolve your liens, they could take years.
        1. Report early;
        2. Call often; or,
        3. GET HELP!  Lien Resolution Servicesspecializes in this process.  When we see a Medicare letter, we know what to do with it – reducing lag time and speeding up the lien resolution process.  LRS makeslien resolution 100% of our focus; we take this administrative work off your hands providing you with time to practice law and litigate cases.
        4. Best of all – The cost of lien resolution isbillable to the client, just like an expert fee.  The attorney pays nothing; and, while the client pays a small fee, he or she ultimately benefits by a reduced lien, faster disbursement, and results.
        5. Contact us for all of the above.
Ryan J. Weiner
Co-Founder Lien Resolution Services


www.NicholsTrialLaw.com 1.800.906.5984