Medicare & Medicaid Lien Laws
What is a Medicare Lien
In many personal injury cases, Medicare pays the initial costs of medical treatment for the injured party. For example, if a person on Medicare is injured in a car accident, Medicare will often pay the emergency room fees and hospital stay costs for the patient. Once the patient is released, files a personal injury claim and recovers a sum from the at-fault party, Medicare has a legal right to take some of the award in payment of the money that the program spent on medical treatment. This right allows Medicare to create a lien against the amount of the personal injury judgment.
According to the Code of Federal Regulations Section 411.37, Medicare takes into account the cost of procuring a judgment when recovering against a patient who has received medical treatment. In order to reduce Medicare’s amount, the judgment must have been incurred during a disputed claim, and the costs of hiring an attorney and pursuing the case must be borne by the winning party.
Medicare computes the amount it will recover based on a ratio, unless the judgment is less than Medicare has spent treating the patient. In that case, the entire judgment may be seized by Medicare. Medicare may also seek a higher recovery amount if the patient disputes Medicare’s right to recover money from the judgment.
An attorney with experience in dealing with personal injury cases and judgments may be able to assist those who are facing a judgment by Medicare or another lienholder. In some cases, these attorneys can assist the personal injury client in limiting the amount of the judgment seized by other individuals and agencies.
What is Medicaid Subrogation
When someone receives medical treatment for a personal injury, the provider of the medical care must be paid. If a person is indigent or does not have the money to pay for medical care and does not have health insurance, Medicaid may pay the costs. If the patient ultimately recovers money for his or her injuries through a personal injury lawsuit, some of that money may be recouped by Medicaid to reimburse the program for its expenses. This is a process known as subrogation.
North Carolina General Statutes Section 108a-57 requires any attorney who handles a personal injury claim to reimburse Medicaid from the proceeds of a settlement before distributing the money to the plaintiff. Section 108a-59 creates a lien against the proceeds by stating that if the patient accepts medical treatment under Medicaid provisions, he or she agrees that any proceeds shall go first to repay the cost of this medical treatment. However, Section 28a-18-2 states that in a wrongful death lawsuit, the amount payable for medical expenses is limited to the greater of $4,500 or 50 percent of the damages after attorney’s fees are deducted.
An attorney who represents personal injury victims has several obligations under North Carolina law to see that medical expenses are paid prior to distributing the proceeds of a settlement or judgment. Personal injury victims or families pursuing a wrongful death may find that a personal injury attorney can assist them in recovering these damages and ensuring that all legal obligations for medical payments are met.
When a member of the armed forces is injured or becomes ill, he or she
can receive medical treatment under a program known as Tricare. Dependents
and spouses of military personnel may also be eligible for treatment under
the Tricare program.
Tricare may also be able to recover expenses when a military member, a dependent or spouse is injured in a personal injury accident and receives medical treatment.
Under 42 United States Code Section 2651, the government can recover amounts paid on behalf of a military member or family member for medical treatment. This process of placing a lien against the personal injury proceeds is known as subrogation.
When a member of the military, a spouse or dependent receives medical treatment for a personal injury, he or she implicitly agrees to allow Tricare to recover damages from the ultimate personal injury settlement. Furthermore, the government reserves the right to collect part of the wages paid to the injured service member during the time that he or she is recovering from a personal injury.
However, Section 2651 does contain an exception. If a veteran receives treatment for an injury at a Veteran’s Administration Hospital or other health care location, the government may not recover these amounts if the injury was connected to the performance of military duty. Money recovered under this section must be appropriated to the proper division, depending on who provided the treatment for the military member.
A personal injury attorney may be able to assist military personnel or their dependents in understanding the lien process and how it can affect a personal injury settlement.
State Health Employee Lien
A lien is a legal obligation to pay money. When an individual or business creates a lien against property, the owner must pay off the balance of the lien before he or she can claim title. Liens are created every day by mortgages against real property, but liens can also be created against other types of property such as vehicles or even paychecks.
Under North Carolina General Statutes 44 through 49, several categories of people are given the right to create liens. These statutes give lien creation powers to certain groups, including:
- Mechanics, laborers and material providers. Those who provide materials or work on cars, homes and other objects have a right to collect for their work and can create a lien to ensure payment for their services.
- Wage earners. Those who are owed wages for work performed may be able to put a lien on property, including financial assets, to ensure they receive their salary.
- Personal injury awards. Those who have been awarded money for a personal injury may have liens placed on their awards by those who have provided medical and other services and who have not yet received payment.
- Child support. Unpaid child support may create a lien against wages and personal property of those who have failed to meet these obligations.
An attorney with experience in dealing with liens can represent clients who are dealing with such issues. This type of attorney may be able to help clients place a lien against property or have a lien removed by representing them.
Contact the Law Office of D. Hardison Wood today to learn more about your rights.