We previously wrote on the In Re Avandia decision granting new Medicare Secondary Payer powers to Medicare Advantage and Part D Plans. As predicted, such Plans are bullish over their new authority. Letters are being sent by Part C and Part D Medical carriers addressed to insurance carriers and self insureds who are settling or otherwise responsible to make payment to a Medicare beneficiary. In such letters, notice is served of consequences if the Medicare liens are ignored. We have attached a redacted letter to this post.
The Part C and Part D Medical carriers are warning carriers and self insureds that suit will be commenced under 42 U.S.C. §1395y(b)(3)(A), which allows for double damages. Such a lawsuit can only be targeted against the insurance carrier or self insured, so the Medicare beneficiary and the claimant’s attorney are not subject to direct action. It also calls into question how the insurance carrier and self insured are protected if they allow the claimant or claimant’s counsel to resolve such liens. Since MSP authorizes action by Part C or Part D against the insurance carrier or self insured only, there is nothing to stop these lawsuits if the Part C or Part D refuses negotiation efforts. Liability for payment is not dependent on fault or the value of the settlement, so negotiations will prove challenging as Part C and Part D test this new authority. The best course of action is to be proactive early on with these carriers. Call Franco Signor to let us show you how.