Medicare Liens On CT Personal Injury Cases
Medicare liens on CT Personal Injury Cases
So you’ve been in a car accident and you’ve mentioned to a friend that you’re talking to an attorney. Your friend says, “Why bother? Isn’t any money you recover going to be eaten up by liens?” And suddenly you’re not sure.
When you are over 65 and on Medicare – every penny matters. You live on a fixed income. And sometimes have to choose between buying food or paying for prescription medications.
Being in a car accident wasn’t something you planned for. And it is made a tough financial situation near impossible.
What is a medicare lien, exactly? Who may have a lien on your case? What is a lien in a personal injury case?
A lien is an amount of money that must be paid to someone else after you receive a settlement or a judgment. For example, if you receive $10,000 from a settlement but there is a $2,000 lien on your file, then you are entitled to receive $8,000. Basically, it’s a bill that must be paid.
What liens are not allowed in a personal injury case in Connecticut?
Generally speaking, if an insurance company has paid for your medical costs, they are not entitled to recover those costs from you or the person who caused your injury. So if you’ve been in a car accident and have required surgery, and your insurance company covered that surgery to the tune of $100,000, Connecticut does not allow your insurance company to put a $100,000 lien on your file. Conn. Gen. Stat. Sec. 52-225c.
Of course there are some big exceptions to this rule, so keep reading. Including self-funded ERISA plans and medicaid.
Who is allowed to place a lien on a personal injury case in Connecticut?
In a word, Medicare.
If you are receiving Medicare benefits for your injury, then Medicare has a right to place a lien on any amount you recover. In fact, your attorney is required to notify Medicare that you are seeking recovery from the person who caused your injuries so that Medicare can evaluate your case for repayment. 42 U.S.C. §1395y(b).
You may be thinking: why tell Medicare in the first place? Well, because the United States can sue for double the amount up to six years later if they don’t get their money in the first place, and no one wants that. 28 U.S.C. 2415(a). The good news is that sometimes your attorney can negotiate with Medicare to significantly reduce the lien.
So, are all Medicare plans allowed to lien a personal injury file?
No. That would be too simple.
If the insurance covering your treatment is a Medicare supplemental health plan–otherwise known as Medi-Gap insurance–then there is no right no recovery. Why? Because supplemental Medicare plans are not really Medicare plans, but private health insurance that is used to compliment Medicare coverage. Remember that in Connecticut, the general rule is that private insurance providers may not recover their costs. Conn. Gen. Stat. Sec. 52-225c.
What about Medicare Advantage plans? Can they place a lien on my file?
We don’t know. This is a question that Connecticut courts haven’t fully addressed. There are good arguments against paying such a lien, but there is also unfavorable case law from other states.
In short, Medicare Advantage plans are private insurance plans that are approved by Medicare. Federal law (42 U.S.C. §1395mm(e)(4)) authorizes these private insurers to recover costs from their insured, and many have placed this right to recovery in their contracts. But are these contractual provisions valid under Connecticut law, considering that we don’t allow private insurers to recover their costs?
We just don’t know. It’s not clear whether the federal law is intended to trump state law. This is a question that your attorney will need to evaluate because if your Medicare Advantage contract does not include the language to permit recovery, case closed. They cannot lien your file. But if the contract does include that language, then your attorney must consider how to proceed.
Of course, as with Medicare, it is sometimes possible for your attorney to negotiate and significantly reduce a Medicare Advantage lien. We don’t take Medicare Advantage Liens at face value. Many of them are bogus liens.
If you have been injured and you’re concerned about liens that may be placed on your file, please call me at 860-471-8333.