Subject Matter: Settlement Issues Related to MMSEA
United States District Court, M.D. Florida,
James E. TOMLINSON and Darlene Tomlinson, his wife, Plaintiffs,
William J. LANDERS, Defendant.
Comments by Matthew Steinberg, Kindred Healthcare
The facts of this case are that plaintiffâ€™s counsel sent out a policy limit demand to defendant insurance company. The insurance company, in response, tendered its policy limits of $100,000 to plaintiffâ€™s counsel but made the check payable to plaintiff and Medicare pursuant to the requirements under the Medicare Secondary Payer Act. The plaintiffâ€™s counsel rejected the check and insisted on taking Medicare off the check and agreed to indemnify defendant from any liens. Defendant moved the court to enforce the settlement agreement. In holding that there was no â€œmeeting of the mindsâ€ thus no settlement, the court provided a good discussion of the secondary payer issue and the situation that we are in as a potential responsible party.
The defendant argued that it placed Medicare on the check because it could not violate federal law by not protecting Medicareâ€™s lien â€“ arguing that they were required to include Medicare on the check to properly protect Medicareâ€™s interests as required by the Secondary Payer Act. The court disagreed. The court held that it was true that a responsible party may be obligated to pay Medicare even if they already paid the beneficiary, but this duty is not required in all circumstances. The court quoted the statute which provides that â€œif Medicare is not reimbursed as required by paragraph (h) [this requires reimbursement to Medicare within 60 days of receiving a primary payment] of this subsection, the primary payer must reimburse Medicare even though it has already reimbursed the beneficiary or other party.â€ The statute adds that this requirement also applies if the primary payer (insurance company) makes its payment to an entity other than Medicare when it is, or should be, aware that Medicare has made a conditional primary payment. 42 C.F.R. Â§ 411.24(i)(1) â€“ (2).
The court held that â€œ[c]ontrary to Defendantâ€™s assertion, [it] would not have violated federal law if it omitted Medicare from the settlement check. [Defendantâ€™s] decision to list Medicare as a payee on the settlement check may have been in [itâ€™s] best interest; however, [defendant] was not required by federal law to include Medicare on the settlement check.â€
Firm/Company: US District Court FL
Document Date: April 2009
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