Donna Black v. John/Jane Doe Employee Et Al – Another Federal Court Ruling on Ripeness of Medicare Secondary Payer Act Related Claims

Posted date in Jason D. Lazarus, J.D., LL.M., MSCC Medicare, Medicare Secondary Payer Act, MSP Compliance

Donna Black v. John/Jane Doe Employee Et Al illustrates the growing problem of Federal Courts being burdened by MSP related issues.  Many settlements are being held hostage by Medicare related issues.  Since insurers are reticent to settle without resolution of Medicare conditional payment issues, some plaintiffs are resorting to attempts to join Medicare as a party forcing them to make a claim for potential conditional payments.  While it may be proactive, it does not work.  In order for a conditional payment to be asserted by Medicare, there must be a settlement, judgment or award.  In this case, that is fatal as the underlying litigation regarding the liability of the defendant for the injuries wasn’t resolved.

According to the court, Medicare’s argument that Ms. Black failed to avail herself of the MSP’s administrative process was fatal to a request for judicial review.  The federal district court judge in the opinion correctly pointed out that Ms.  Black had “neither received an initial determination from the Secretary nor completed any of the subsequent steps necessary to receive a final decision” regarding any potential Medicare conditional payment.  Accordingly, “[w]hether the Secretary will seek reimbursement, and if so, how much, can only be reviewed by a federal court after Medicare’s administrative procedure has been exhausted.”  The fact that Medicare might in the future seek recovery of conditional payments does not give a federal district court jurisdiction.

This is another case of failure to understand the requirements of the MSP when it comes to resolution of conditional payments.  A better course of action in cases involving a Medicare beneficiary is to begin the process of conditional payment resolution as early as possible.  By following the process and procedures in place currently, it is possible to resolve Medicare conditional repayment obligations in a reasonable time frame.  I do use the term reasonable loosely and all parties must realize that the MSPRC is overworked and understaffed.  Beginning the process early only is the only answer as this case and others illustrate there can be no judicial review if the administrative remedies have not been exhausted first.