Public Health – Medicaid — liens against settlement

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Wisconsin Supreme Court

Civil

Public Health – Medicaid — liens against settlement

A charitable hospital may pursue payment for medical care provided to a Medicaid-eligible patient by filing a lien against a settlement between the patient and an insurance company covering the liability of a tortfeasor responsible for the patient’s injuries.

“Contrary to the Gisters’ argument, an examination of the language of the hospital lien statute demonstrates that the liens filed by St. Joseph’s did not constitute the ‘direct charges’ proscribed by Wis. Stat. § 49.49(3m)(a). Liens filed pursuant to the hospital lien statute ‘attach to any and all rights of action, suits, claims, demands, and upon any judgment, award or determination and upon the proceeds of any settlement.’ § 779.80. In other words, the hospital lien statute allows, under certain circumstances, for a direct recourse to the various actions undertaken by the patient (i.e., the suits, claims, demands, etc.). At the same time, it must be emphasized that the hospital lien statute does not permit a direct recourse to the patient himself. Cf. Cullimore v. St. Anthony Med. Ctr., 718 N.E.2d 1221, 1224 (Ind. Ct. App. 1999) (noting that Indiana’s hospital lien statute gives a hospital ‘a direct right in the insurance proceeds and other settlement funds which are paid to the patient by the person claimed to be liable for the patient’s injuries . . . .’) (emphasis added). In this regard, St. Joseph’s liens can be analogized to an in rem action, which ‘is directed against . . . property and seeks a judgment as against the world with respect to the property that is the subject of the action.’ In re Return of Property in State v. Glass, 2001 WI 61, ¶16, 243 Wis. 2d 636, 628 N.W.2d 343 (footnote omitted) (emphasis added); see also Jayko v. Fraczek, 966 N.E.2d 1121, ¶23 (Ill. Ct. App. 2012) (holding that a health care provider’s lien on a personal injury action settlement was an in rem proceeding).”

Reversed.

2009AP2795 Gister v. American Family Mut. Ins. Co.

Gableman, J.

Attorneys: For Appellant: Sunby, David E., Wausau; Lanford, Rhonda L., Madison; For Respondent: Feeley, Timothy W., Milwaukee; MacCarthy, Sara, Milwaukee