Settling a suit? Don’t forget Medicare’s share

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Personal-injury and defense attorneys trying to reach a settlement must remember that the federal government always wants to be paid first and is not choosy about where the money comes from, particularly in cases involving Medicare-eligible plaintiffs.

Thus, plaintiffs and defendants must find out from the Centers for Medicare and Medicaid Services just how much Medicare has paid — and expects to pay — on the plaintiff’s behalf because the government will want its money back somehow from the settlement, said plaintiffs’ attorney Paul Bekman.

The need to get reimbursement information from the centers, which oversee Medicare, can delay settlement talks as lawyers for both sides will need that information, Bekman said.

Plaintiffs’ attorneys want to ensure their clients will not be shortchanged in the settlement by an unknown Medicare debt, and defense attorneys will not sign off on an agreement amid uncertainty about what the government could do, he added.

Delays in getting reimbursement information have thus “become in many cases an impediment to resolve cases,” Bekman said. “In many cases, it takes a long time to get a response from Medicare.”

To avoid needless delays in settlement talks, Bekman said he seeks Medicare reimbursement figures early in his representation of clients who meet Medicare’s eligibility requirements of being at least age 65 or having disabilities.

The information is sought “right away, so we’re in at the ground floor, as they say,” said Bekman, of Salsbury, Clements, Bekman, Marder & Adkins LLC, Baltimore.

“You have to identify it early and deal with it,” he added, referring to the reimbursement issue.

Civil defense attorney Larry Ceppos agreed the Medicare reimbursement issue is “very volatile,” as the federal government need not seek reimbursement from the plaintiff if the injury claim has been settled out of court.

Medicare has “a potential direct cause of action against the defendant and even the defendant’s insurer,” added Ceppos, of Armstrong, Donohue, Ceppos, Vaughan & Rhoades Chtd. in Rockville, Md. “It’s an issue for defendants.”

Bekman said plaintiffs can assuage the insurer’s concern by indemnifying the underwriter if the government seeks reimbursement from the company.

Steven Platt, a former circuit court judge who now heads The Platt Group Inc., an Annapolis, Md.-based alternative dispute resolution firm, said he expects the attorneys who appear before him in personal-injury cases to have contacted the centers, know the amount owed to Medicare and be prepared to discuss who will be responsible for that debt before the mediation begins.

“It’s not something that I as a mediator can mediate,” said Platt, “because Medicare is not in the room.”