Denver Worker's Compensation Info: medicare

Friday, October 28, 2016

Presidential Election and Medicare

With the Presidential Elections on November 8th nearing around the corner, the industry has been wondering how the election of either Hillary Clinton or Donald Trump as President of the United States would affect Medicare Secondary Payer (MSP) Act compliance. *Note that this blogwire article is not intended to be an endorsement for either political candidate, political party, platform, or affiliation.

If Donald Trump is elected: Donald Trump’s website does not directly address his position on Medicare. However, according to a Forbes.com article, “The GOP platform advocates a “premium support model” for Medicare that would “guarantee to every enrollee an income-adjusted contribution toward a plan of their choice, with catastrophic protection.” In other words, privatization. Republicans would “save Medicare by modernizing it,” the platform says.”

Potential Impact: Currently 31% of Medicare beneficiaries are enrolled in a private Medicare Advantage Plan (MAP). That percentage is expected to increase, and if Trump is elected, we may see that number rise more rapidly. The effect on MSP would be that we would see a rise in conditional payments being made by MAPs, versus traditional Medicare.

Over the past several years, we have seen increased case law finding that Medicare Advantage plans have the same rights as Medicare to recovery, thereby allowing the Medicare Advantage Plan to assert double damages. As Medicare Advantage Plans have become even more aggressive with lawsuits for double damages than traditional Medicare has, we could expect that to continue. Primary payers would be wise to enact a proactive solution to ensure that Medicare Advantage Plan conditional payments are addressed, particularly in those Circuits where the Courts have found in favor of MAPs having these rights.

To learn more about MAPs and recommendations to address reimbursement of these payments, please join Franco Signor for a webinar wherein we will feature a special guest to discuss these Best Practices on November 18th, at 1:30 PM. Registration for the webinar can be found here.

If Hillary Clinton is elected: According to Hillary Clinton’s website, Hillary Clinton proposes to allow people 55 and older to buy into Medicare. She is calling this “Medicare for More.” Additionally, Clinton rejects the idea of gradually converting Medicare into a privatized system.

Potential Impact: Currently, the age to enroll into Medicare is 65. If people aged 55 and up could now buy into Medicare, there ideally will be more MSP claims to address as the Medicare population would expand to a younger age group.

Summary: While neither candidate can single-handedly make these changes and would need the support of Congress, with either candidate we are likely to see an increase in claims that would require MSP compliance. Whether we continue to see Medicare beneficiaries move to private Medicare Advantage Plans which continue to press for their rights to double damages reimbursement, or the Medicare pool expands to individuals 55 and up, MSP compliance will be more important than ever.

Additionally, CMS has indicated that an award for the Workers’ Compensation Review Contractor (WCRC) will take place in the second quarter of next year. With the new WCRC, we may also have thresholds for Liability Medicare Set-Aside (LMSA) review. 2017 will be an interesting year, and having a strategic partner that is ready to provide a holistic claims strategy to your MSP compliance program will be vital.

Original Source

Contact Neil O'Toole and John Sbarbaro

at the Law Office of O'Toole & Sbarbaro, P.C.

Phone: 303-595-4777

Located in the Denver Metro area.

226 West 12th Avenue Denver, Colorado 80204

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Tuesday, August 9, 2016

Win for Medicare Advantage

In a 2-1 final decision out of the Eleventh Circuit Court of Appeals, Humana Medical Plan, Inc. v. Western Heritage Insurance Company, Humana prevailed in recovering double damages under the Medicare Secondary Payer (MSP) private cause of action due to Western Heritage’s failure to reimburse Medicare conditional payments. Recall that last year the District Court of Appeals had also found in favor of Humana, to which Western Heritage appealed that decision to the Eleventh Circuit. Oral arguments were heard in the Eleventh Circuit earlier this year, and the industry has been eagerly waiting the Eleventh Circuit’s decision.
Background/Recap of the Facts: In January 2009, Mary Reale, a Humana Medicare Advantage Plan beneficiary, was injured at Hamptons West Condominiums. Ms. Reale treated for her injuries and Humana paid for the treatment, totaling $19, 155.41. In June 2009, Ms. Reale and her husband sued the condominium in Florida state court for her injury. In March 2010, while her litigation was pending, Humana issued to Ms. Reale an Organization Determination in the amount of $19, 155.41. Although an administrative appeal process was available, no party appealed Humana’s Organization Determination. On April 20, 2010, in return for $115,000 from the condominium and its liability insurer, Western Heritage, the Reales released the condominium and Western Heritage. The Reales represented in the settlement agreement that there was no Medicare or other lien or right to subrogation. The Reales also agreed to indemnify the condominium and Western Heritage against any Medicare lien or right to subrogation.
On May 7, 2010, Humana sued the Reales and their attorney in the Southern District of Florida seeking reimbursement. The Reales sought dismissal, to which the court agreed, holding that a Medicare Advantage Plan (MAP) does not have a private cause of action to recover reimbursement from a beneficiary under the MSP. Likely in response to Humana’s suit, the condominium and Western Heritage attempted to make Humana a payee on the settlement draft to the Reales. The Reales then sought sanctions against Western Heritage for failure to comply with the settlement agreement. At that point, the parties agreed instead that the Reales’ attorney would hold $19, 155.41 in trust out of the $115,000 settlement amount pending resolution of the Reales’ litigation, and Western Heritage then tendered the $115,000 settlement to the Reales.
At this point the Reales sued Humana seeking a declaration as to what they owed Humana, however the court ultimately ruled that it lacked jurisdiction to adjudicate the dispute between Humana and Ms. Reale as to her MAP benefits. Subsequently, on January 11, 2011, Humana sued Western Heritage in the action upon which this appeal proceeded. Humana’s initial counts in its complaint were: 1) Double damages under the MSP private cause of action, 42 U.S.C. § 1395y(b)(3)(A); 2) Declaratory relief under the Medicare statutory and regulatory scheme; 3) Damages under several state law theories including unjust enrichment and a contract implied by law.
Eleventh Circuit Decision: Through analysis of the MSP and CMS regulations, the Eleventh Circuit found that MAPs have a right to a private cause of action for double damages against a primary plan where reimbursement has not occurred. Specifically, the Eleventh Circuit found the following persuasive: 1) CMS Regulations- A MAP “will exercise the same rights to recover from a primary plan, entity, or individual that the Secretary exercises under the MSP regulations in subparts B through D of part 411 of this chapter.” 42 C.F.R. § 422.108(f); 2) Statutory Basis- The MSP private cause of action, located at 42 U.S.C. § 1395y(b)(3)(A) is unambiguous and broadly permits any party with standing (including a MAP) to sue a primary plan. The Third Circuit in the In Re Avandia case also held that MAPs are included within the purview of parties who may bring a private cause of action.
Western Heritage countered that the MSP does not govern MAPs at all and that the MAP right-to-charge provision instead governs when and whether a MAP is a secondary payer. However, the court rejected this argument finding that the right to charge provision reveals that MAP payments are made secondary to primary payments under the MSP.

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