Resolving a Medicare Secondary Payer (MSP) lien can be challenging, especially if you are unfamiliar with the laws and regulations governing these types of liens. However, following a structured Medicare lien compliance and resolution system is key to resolving Medicare liens, and it is attainable by following the steps below.
Step 1: Gather Essential Medicare Information
The first step in navigating Medicare liens in personal injury cases is to collect all necessary Medicare-related information from your client. Accurate and comprehensive data collection is crucial for a smooth lien resolution process.
Collecting Client’s Medicare Details
If your client receives Medicare benefits, obtain the following documents from them:
- Medicare Health Insurance Card
- Correspondence with CMS/ Medicare: Gather all communications received from Medicare, such as Explanation of Benefits (EOBs), bills, or notices.
- Additional Documents:
- Request any documents, bills, or statements your client has received from medical providers or other insurance involved in the case.
- Ensure you have documentation for any medical payments coverage.
In addition to the documents listed above, ensure that you obtain the following information from your client:
- Full Name (including any variations)
- Medicare Number
- Gender
- Date of Birth
- Complete Address and Phone Number
This information is vital for correctly reporting the claim to Medicare. Further, medical bills and other insurance claims will help auditing medical charges later in the process to avoid double payment issues. Ensuring the accuracy of the collected information at this early stage can prevent potential complications or delays in later steps.
Step 2: Efficient Use of the Medicare Secondary Payer Recovery Portal
The Medicare Secondary Payer Recovery Portal (MSPRP), simply referred to as the Medicare Portal, is the most efficient and cost-effective way to manage all Medicare liens. The Medicare Portal allows you to engage in all the activities that you once had to perform over mail or fax.
Initial Notification and Proof of Representation
As soon as possible, register your initial notification with Medicare. Medicare is a bureaucracy, and obtaining responses can take a long time. It is important to get ahead of the curve.
To receive notices on your client’s behalf, you will have to provide Medicare with proof that you represent the beneficiary. Medicare provides model language for a proof of representation form on its website.
In lieu of a separate proof of representation document, attorney representatives can provide a copy of the retainer agreement, provided the retainer agreement meets the following criteria:
- The retainer agreement is on attorney letterhead or accompanied by a cover note on letterhead,
- The retainer agreement is signed by the beneficiary,
- The beneficiary’s name and Medicare Health Insurance Claim Number (HICN) are printed at the top of the form (this may be added after the retainer agreement is signed), and
- The retainer agreement is signed or countersigned and dated by the attorney.
Await the Rights and Responsibilities Letter & the Conditional Payment Letter
If the liability insurer already reported the claim to Medicare, your client might have already received the Rights and Responsibilities letter.
Once you upload the case into the Portal, you will receive confirmation, and the recovery contractor will compile the claims and post the Conditional Payment Letter to the Medicare Portal within 65 days.
Step 3: Strategically Dispute Medicare Charges
Always review the charges that Medicare asserts are related to the claim and dispute any charges that should not be included. Until you request a final conditional payment amount, you can make an unlimited number of disputes. If Medicare denies your dispute, you can provide more information and submit the dispute again.
Identifying and Challenging Clear Errors
Medicare may simply make a mistake and pay the same claim twice. Always review the payment summary to ensure that each claim was only paid once. If there are errors, clearly point them out and request that Medicare remove the erroneous charge.
Medical providers sometimes submit the same claim to multiple insurers. For instance, they might bill both the beneficiary’s medical payment coverage and health insurance. Often, the med-pay coverage also pays a claim listed on a health insurer’s summary. If Medicare does this, show evidence of the other payment. Then ask Medicare to remove the charge from their summary.
Removing Unrelated Charges
Seek removal of any charges in Medicare liens that are not related to the illness or injury. Medicare is relying on ICD-10 codes and other submissions to determine what claims to include in the payment summary. They do not have the same direct knowledge about the injury as you or your client.
Request the removal of the charge if the subject claim relates to a preexisting condition, or if routine medical care was lumped in with the conditional payment summary.
Provide support for your contention that the charge is related to a preexisting condition. The best support will be doctor’s notes or records from the provider, but rulings or orders from the court or worker’s compensation commission will also be persuasive.
Addressing Bundled Charges
Providers are supposed to submit claims individually, but they may sometimes bundle several claims together under one charge. If Medicare does not reject the claim, and accidently pays this “bundled claim,” Medicare cannot “unbundle” the claims.
Therefore, if you see a bundled charge on the conditional payment summary, seek removal of the entire bundled charge because the statute does not support its recovery because a bundled charge is not “an item or service” but several charges lumped together.
The Medicare Secondary Payer statute refers to “an item or service,” which does not refer to multiple medical claims. Cal. Ins. Guar. Ass’n v. Burwell, 227 F. Supp. 3d 1101, 1112 (C.D. Cal. 2017) (“The statutory phrase ‘an item or service’ clearly does not refer to multiple medical treatments just because they appear under one charge.'”)
Review the Hospital Acquired Conditions List
Every year, Medicare provides a list of ICD-10 codes that Medicare is not supposed to pay. These are “hospital-acquired conditions,” or conditions that the beneficiary acquired while under the provider’s care and arguably could have been prevented.
Seek removal of claims on the conditional payment summary that match claims on the hospital-acquired conditions list. Further, a reasonable strategy is to seek the removal of claims in the conditional payment summary that are related to or analogous to claims on the hospital-acquired conditions list.
Check for Updates Periodically
Law firms can obtain up-to-date amounts of Medicare liens through the Medicare Portal. It is advisable to check back periodically or request updated amounts through the pendency of the case if you know that your client has continuing treatment.
Do Not Rely on the Conditional Payment Letter when Settling the Case
Settling cases with Medicare liens can be a hazardous process. If the beneficiary has continuing medical treatment, settling the underlying claim based on a non-final conditional payment letter can mean your client ends up with nothing. Fortunately, the Medicare Portal enables you to obtain a final conditional payment amount that you can rely upon when settling the underlying claim.
Step 4: Close to Settlement? Engage in the Final Conditional Payment Process
The Final Conditional Payment process through the Medicare Portal helps you settle a case with reliable numbers to avoid unwanted surprises.
Notify Medicare 120 Days or Less Before Settlement
Within 120 days of settlement, in the Portal, notify Medicare that the case is close to settlement. After you trigger the process, you have one more opportunity to dispute claims included in the payment summary. After you submit the dispute, Medicare has 11 days to grant or deny the dispute. If Medicare does not respond within 11 days, it will grant your dispute.
Download the Final Conditional Payment letter
When you are close to settlement, request a final conditional payment amount. Medicare will generate a final conditional payment letter.
Once you download the Final Conditional Payment letter, you have three business days to settle the case. If the case does not settle in that timeframe, you can simply re-do the Final Conditional Payment Process again.
Submit Settlement Information and Await the Final Demand Letter
Within 30 calendar days of settling the underlying case, provide Medicare with the settlement information via the Medicare Portal. After the settlement information is provided to Medicare, Medicare will apply its statutory reduction formula to reducing Medicare liens and issue a Final Demand Letter.
Final Step: Ensure Timely Medicare Reimbursement
Understanding the Reimbursement Timeline for Medicare Liens
Medicare will issue the Final Demand Letter within 45 days of your request. The Final Demand Letter will provide a date by which you must reimburse Medicare. The law requires you to reimburse Medicare within 60 days of receiving the settlement proceeds. 42 CFR § 411.24(h). If you act with an abundance of caution, take whichever date is sooner, and reimburse Medicare by that date.
After receiving payment, Medicare will issue a letter stating that it has reduced the lien to zero and closed the case.
Consequences of Non-Payment of Medicare Liens and Interest Accrual
Interest will accrue from the date of the final demand letter is assessed for each full 30-day period the debt remains unresolved. The interest rate is considerable. As of July 18, 2022, the interest rate charged on underpayments is 8.75 percent. By law, all payments are applied to interest first, and principal second. 42 CFR 411.24(m).
Appeal or Request for Waiver Will Not Toll Interest on Medicare Liens
Requesting an appeal or a waiver will not toll the interest on the unreimbursed amount. However, if you reimburse Medicare in full and then obtain a reduction via the appeal or waiver process, Medicare will issue a refund.
Therefore, if there is a colorable reason to argue for a reduction, it is always in the beneficiary’s best interest to reimburse Medicare first and then request an appeal or a waiver to avoid interest.
If you do not reimburse Medicare after 90 days of the final demand letter, Medicare will refer the debt to the Department of Treasury for collections.
Conclusion: Mastering Medicare Liens in Personal Injury Law
Navigating Medicare liens in personal injury cases is a complex but essential aspect of legal practice. The steps outlined in this guide provide a structured approach to ensure compliance and protect your clients’ interests. By meticulously gathering Medicare information, efficiently using the Medicare Portal, strategically disputing charges, and adhering to the final conditional payment process, you can effectively manage and resolve Medicare liens.
Frequently Asked Questions (FAQs) about Medicare Liens in Personal Injury Cases
What is a Medicare Secondary Payer (MSP) lien?
A MSP lien occurs when Medicare pays for medical care that another entity, like an insurance company in a personal injury case, should cover. Medicare has the right to reimbursement for these payments.
Why is it important to deal with Medicare liens in personal injury cases?
Failure to properly address Medicare liens can lead to legal and financial consequences for both the attorney and the client, including the possibility of paying interest on the lien amount or facing collections actions.
How soon should I report a personal injury case to Medicare?
It’s advisable to report as soon as possible. Medicare is a large bureaucracy, and obtaining responses and resolutions can be time-consuming. Early reporting can help streamline the process.
Can I dispute charges on Medicare liens?
Yes, you can dispute charges you believe are unrelated to the injury or illness in question. It’s important to review the charges carefully and provide supporting evidence for your dispute.
What happens if I don’t reimburse Medicare within the stipulated timeframe?
Failure to reimburse Medicare within the 60-day window post-settlement or receipt of the final demand letter can result in interest accruing on the owed amount. CMS might refer the debt to the Department of Treasury for collection.
Does requesting an appeal or waiver stop interest from accruing on Medicare liens?
No, interest will continue to accrue even if you have requested an appeal or waiver. It’s often advisable to pay the demanded amount first and then seek a refund if the appeal or waiver is successful.
Can Medicare liens be negotiated or reduced?
You can reduce Medicare liens if you provide evidence that the charges included in the lien statement are not related to the injury or are should not be included for other reasons. Further, there are avenues to reduce a Medicare lien after Medicare issues the Final Demand Letter.
Is it necessary to involve a lien resolution specialist for Medicare lien resolution in a personal injury case?
While not required, involving a specialist who is knowledgeable in Medicare lien resolution can be extremely beneficial due to the complexity of the process. It also allows the personal injury attorney to focus on the case against the defendant, rather than be mired in the details of resolving Medicare liens.