If you’ve personally resolved healthcare liens for a client, you know that the process can be a bit of a maize. First, you must figure out what federal, state, and/or private/ERISA healthcare coverage paid for your client’s treatment. In a perfect scenario, it’s straightforward – your client provides you with an organized file containing copies of all medical bills and documentation for each payment. But let’s face it: usually, it’s not this simple. Plaintiffs don’t have a complete record of bills and payments. Many will have multiple healthcare liens associated with their recovery. Some don’t know which providers paid for which treatments. So counsel is left to try and figure it all out; at the end of the day, you are responsible for seeing that all healthcare liens are thoroughly addressed before your case can be finalized.
For example, a plaintiff is covered under her employer’s healthcare plan when she is permanently disabled in a car accident. After her injury – but before the settlement is finalized – she loses her employer-sponsored coverage and enrolls in Medicare and Medicaid. The plaintiff then becomes a “dual beneficiary” when Medicaid kicks in to cover the coinsurance and deductible for her Medicare coverage. Consequently, the attorneys are now responsible for addressing the private insurer, Medicare, and Medicaid liens in this case. One pitfall attorneys encounter when dealing with claimants who “only” have Medicare coverage is thinking that resolving liens will be straightforward. In fact, they may end up trying to resolve three separate healthcare reimbursement claims in the end, as Medicare plans could be outsourced to multiple administrators for different components of coverage: Medicare Part A, Part B, Part D & Medicare Advantage Organizations (Medicare Part C plans). Each benefit structure has unique plan language governing reimbursement and separate protocols to develop, offset, compromise, and finalize claims. A detailed checklist for resolving Medicare, Medicaid, and private liens and determining the propriety of MSAs can be found in our eBook, Build It vs. Buy It: How Outsourcing Healthcare Lien Resolution & Medicare Set Aside Administration Could be the Best Decision you Make for your Clients and your Firm. In short, counsel must check off the following boxes in each case:
- Determine the parties’ affirmative obligation to notify healthcare plans
- Assess the healthcare plans’ right of recovery under the facts at hand
- Audit and analyze all reimbursement claims to determine accuracy and to “carve out” items unrelated to injury/settlement
- Pursue relevant administrative or legal remedies, such as damage allocation, waivers, and compromises, if needed
- Determine whether it’s necessary to establish a MSA
What’s the bottom line? Each firm has a clear decision to make: address liens internally or engage a third-party service provider. Healthcare liens are complex and ignoring them is not an option. Law firms that don’t already have procedures in place to address healthcare liens need to develop a clearly defined strategy to ensure their clients’ liens and overall claims are properly handled.