An Example of How a Jury is used to Protect Medicare’s Interest
Roy Franco
November 26, 2012

Alexander v. Laborde,et. al., Court of Appeal of Louisiana, Third Circuit. (2012)

Many times we are asked about protecting Medicare’s interest in a trial setting.  The defendant is usually concerned about exposure after being required to pay over a lump sum to the plaintiff without any ability to direct payment to protect Medicare.  We have found the best way to protect the defendant was to leverage the jury.  Where a properly prepared jury verdict form is used, along with clear jury instructions, a defendant can be protected; but may need some additional post trial motion work to do so.

In the case of Alexander v. Laborde, plaintiff exacerbated her pre-existing lower back injury when she was rearended by defendant.   While both sides agreed that surgery was necessary to correct plaintiff’s condition, they differed on whether it was causally related to the accident.  In putting the matter to the jury, the parties laid out the following damage elements:

Medical Expense

Future Medical Expense

Past Pin and Suffering

Future Pain and Suffering

Past mental anguish

Future Mental Anguish

Loss of Enjoyment o f Life

Future Loss of Earnings

The jury returned completed the verdict form and wrote in an amount for future medical expense.  In most cases, this would be a good result, as Medicare would now be limited to any recovery based on the award for past and future medical expense.  The plaintiff would be free to spend her other damage elements without regard to Medicare’s interest as the jury had spoken after a court proceeding on the merits.

In this particular case however, the defendant was unhappy that the jury made an award and appealed based on the theory that the jury was wrongly influenced based on Medicare.  In short, defendants felt the jury was led to believe that Medicare would pay instead of the defendant if no award was made for future medical.  However, the defendant did not object when the jury verdict form was introduced, nor the jury instructions and not even when the argument was presented.    Defendants hence waived their right of appeal on this point.  Notwithstanding, the appellate court did note that such funds would have to be put away in a separate account and handled in a way that protects Medicare in accordance with applicable Medicare rules and policies.

Either way, had defendant prevailed or not, the finding would define the future medical after a trial on the merits.  Under Medicare Secondary Payer Manual, Chapter 7, Section 50.4.4, the defendant’s exposure is now limited to the medical portion of the verdict.   If no form is used, then the entire judgment is exposed, and defendant would have no basis under post verdict motion to direct payments to Medicare for past medical and direct future medical expense into a Medicare Set Aside Account.