On September 6, 2011 the Medicare Secondary Payer Recovery Contractor (MSPRC) published a Beneficiary Alert on the website (www.msprc.info). The Alert advised that in liability cases (not workers’ compensation cases or no-fault cases), where a settlement, judgment or award is $300.00 or less, Conditional Payment Recovery will not be pursued by Medicare. They explained that two conditions must be satisfied in order to avoid Medicare’s recovery attempt:
- First, the settlement, judgment or award must be based on physical trauma.
- Second, no other or additional settlements can be reached that are related to the same alleged incident.
Significantly, the MSPRC identified that the threshold includes settlement, judgments or awards where an insurer has paid or is paying medical bills. Thus, liability must be denied and the aggregate settlement must be $300.00 or less. Further, if a demand letter has already been issued by the MSPRC in a case, the threshold would not apply.
As a practical matter, it appears that the threshold will have little affect on litigated claims with attorney representation. Clearly, most liability cases easily exceed the threshold value. More importantly, however, the setting of any threshold seems to signal a more reasonable approach to Medicare recovery efforts. Potentially, the time and resources required to pursue de minimus lien amounts may now be used elsewhere in an effort to bolster Medicare’s precarious financial state.
About the Author: Russell S. Whittle, Esq., is the Vice President of MSP Compliance for Gould & Lamb, LLC. In his twenty plus years of practice prior to joining Gould & Lamb, LLC, Mr. Whittle practiced primarily in the area of insurance defense, representing the interests of large insurers and employers in both workers’ compensation and general automobile liability matters.