Medicare has acknowledged the turmoil. It has announced a 1 year moratorium on its rule change from October 1, 2010, to October 1, 2011. Medicare’s announcement can be found here.
To recap, Medicare imposed rules which mandate that defendants, insurance companies, and their attorneys make sure that Medicare has no lien on a personal injury settlement. If a lien is not reported and not paid at the end of the case, then these parties can be fined $1,000 a day! This draconian rule has caused insurance companies to over-react and require clearances from Medicare even when it is clear that Medicare was not involved.
Another problem is that Medicare has been taking as much as 6 to 8 months to provide lien figures. This means an injured person may have to wait 8 months or more until he or she can receive the settlement funds. This is an unfair burden on the elderly who need their settlements. We have a client of 95 years of age who must wait! So far, it has been 3 months since we settled her case, but we cannot get the funds until Medicare provides its figures.
This 1 year moratorium gives everyone a bit of breathing room. However, many insurance companies will disregard it, and, in fear, they will require Medicare’s involvement. Therefore, the Medicare mess is still there. The American Association for Justice is trying to resolve these problems with Medicare.
If Medicare is delaying your settlement, please understand that this problem is beyond our control and is a problem facing all personal injury clients.
Mark E. Seitelman, 11/17/10, www.seitelman.com.