Tuesday, April 19, 2011

Push Back on Confirmation of Medicare/Medicaid Liens Issue

A relatively recent trend in the settlement of civil litigation matters has included requests by the liability insurance company that the Plaintiff produce final lien information with regards to Medicare and/or Medicare before the matter can be finally concluded.  This is so because of the potential penalties that may exist if Medicare and/or Medicaid liens are not addressed out of the settlement funds.

In response, there has been a more recent push back by Plaintiff's counsel objecting to such requests for documented lien information, particularly where there has been previous confirmation that no such liens exist.

In an April 4, 2011 Order, in the case of Vincent v. Buck, No. 2011-CV-456 (Cambria Co., April 4, 2011, Swope, S.J.), Senior Judge Thomas A. Swope, Jr. of the Cambria County Court of Common Pleas granted a Plaintiff's Motion to Enforce a Settlement in a case where the carrier refused to issue a settlement check in a motor vehicle accident case until the Plaintiff produced documentation confirming the status of any Medicare/Medicaid Lien.

In Vincent, the Plaintiff's attorney had provided the liability carrier with copies of letters from Medicare confirming that there were no liens for the two Plaintiffs involved in this matter (these letters were not "final" confirmation lien letters).  The attorney also confirmed that, with respect to one of the Plaintiffs, that person's first party medical benefits coverage had not yet even been exhausted.

The Plaintiffs also emphasized that, in the Release, which was authored by the carrier, there was no requirement that the Plaintiffs provide any final lien documentation before the payment of the settlement funds as demanded.  Furthermore, the Release provided that the Plaintiffs agreed to remain responsible for any and all liens, including any liens asserted by any federal entity or agency.  In the Release, the Plaintiffs also specifically agreed to indemnify and hold the liability carrier and its counsel harmless for any and all liens that may arise.

In addition to arguing the above, the Plaintiffs also pointed to the recent Pennsylvania Superior Court case of Zaleppa v. Seiwell, 9 A.3d 632 (Pa.Super. 2010) in which the appellate court held that neither the liability carrier or the defendant tortfeasor had any legal standing to attempt to act on behalf of Medicare in terms of protecting a lien. 

Accordingly, when the settlement draft was not forthcoming, Plaintiff's filed a Motion to Enforce the Settlement which, as noted, was granted by the trial court in this matter.  In its Order, the trial court also allowed for interest on the delayed payment and attorney's fees and costs associated with the motion.

The prevailing Plaintiffs' attorney in this matter was Joseph J. Nypaver, Esq. of the Altoona, Pennsylvania law firm of Serbin, Kovacs & Nypaver, L.L.P.

Anyone desiring a copy of this Order (without opinion) in Vincent v. Buck may contact me at dancummins@comcast.net.

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