Medicare on the Settlement CheckPosted date in Medicare, Medicare Secondary Payer Act, MSP Compliance
Most trial lawyers understand their obligations under the MSP with regard to making sure conditional payments are repaid. The problem is the growing misconception among insurers that Medicare should be on the settlement check to insure compliance with the MSP. Some insurers have even been told that the law requires Medicare be on the check. This is simply not so.
I was asked last year by a trial lawyer to assist in a case where Medicare was put on the check despite this not being a term of settlement. The insurer moved to enforce the settlement and plaintiff counsel was forced to defend his position that the law didn’t require Medicare be on the check. I provided an affidavit arguing why the law did not require Medicare be on the check. That case resulted in a published Federal District Court opinion, Tomlinson v. Landers, regarding the issue of whether Medicare must be on the check.
The Tomlinson court found definitively that the MSP didn’t require Medicare be on the check. The court stated that “federal law does not mandate that a primary payer (or insurer) make payment directly to Medicare.” The court did recognize though that “an insurer may be liable to Medicare if the beneficiary/payee does not reimburse Medicare for any amounts owed to Medicare within sixty (60) days.” Nevertheless, the court found the defendant’s decision to “list Medicare as a payee on the settlement check may have been in [defendant’s] . . . . best interest, however, [defendant] . . . . was not required by federal to include Medicare on the settlement check.” Given this fact and the dispute concerning whether Medicare needed to be included on the check illustrated to the court there was no meeting of the minds in terms of settlement. As a result, the settlement was not enforced and a bad faith action could be pursued. When an insurer takes a similar position in the future, it may open the door to similar holdings and bad faith causes of action.
If you would like a copy of my affidavit, feel free to e-mail me at email@example.com