Medicare has made recoveries in personal injury lawsuits messier and more prolonged.
Medicare has a lien for its medical payments to the injured person for medical bills arising from the accident. Medicare’s lien gets adjusted for the amount of the recovery and the cost of getting the recovery, such as the lawsuit expenses and the lawyer’s fee.
Medicare’s recently enacted rules require that defendant or its insurer make sure that Medicare is involved in the settlement before defendant pays any settlement money. Defendants and their insurance companies can get fined if they do not comply, therefore, the insurance industry has become very tough in enforcing these rules.
The net result is that defendant’s insurer cannot pay until Medicare gets involved. Once it is notified, Medicare is taking 3 to 9 months to provide its lien figures and to arrive at a settlement. Therefore, settlements are being delayed due to Medicare’s inefficiency.
This delay is onerous on older clients who may have waited years for a settlement and must now wait many months more. For some clients time is very precious, and they do not have time for more delays. We have one client who just settled her case and is 95 years of age.
The American Association of Justice (www.justice.org) is proposing rule changes that would greatly speed-up the process.
Something must be done.
Mark E. Seitelman, 8/30/10, www.seitelman.com.