U.S. Supreme Court Denies Writ – Private Cause of Action for Medicare Advantage and Part D Upheld
Roy Franco
April 15, 2013

Several months ago we blogged about  In re: Avandia Marketing, Sales Practices and Products Liability Litigation Glaxosmithkline, LLC & Glaxosmithkline, PLC Humana Medical Plan, Inc. and Humana Insurance Company, individually and on behalf of all others similarly situated, 2012 U.S. App. LEXIS 1320. We felt strongly about the expansion of the Medicare Secondary Payer Act’s private cause of action for Medicare Advantage and Part D Drug Plans.  The Third Circuit Court of Appeal determined that under 42 U.S.C. §1395y(b)(3)(A)  these private plans, authorized by the Centers for Medicare & Medicaid Services, had a right to sue primary plans for reimbursement and seek double damages.   In reaching their conclusion, the Court found the plain text of the provision swept broadly enough to include Medicare Advantage and Part D plans and placed no limitations on which private parties may bring suit.  Although the Court refused to extend qui tam actions to agents, as only Parties can litigate, it did mention that even if the private cause of action was ambiguous, the Centers for Medicare & Medicaid Services memo supporting such claims would have to be given deference.  The Court did not feel it was necessary to do, but  did make such statement to demonstrate their strong feelings on the topic.

Recognizing this expansion of the private cause of action beyond the Medicare beneficiary, when prior decisions had worked to limit it, we felt it important to join other MARC members to file an amicus brief in support of a writ by defendants to the U.S. Supreme Court.  We filed our amicus on 1/4/2013, and regrettably learned that on April 15, 2013 the request for writ was denied.

Avandia is now clear law of the Third Circuit.  How it will play out in other Circuits remains to be seen, however, the denial of the writ by the U.S. Supreme Court strengthens the persuasive authority of his decision.  Franco Signor LLC recommends that every claim be investigated for Medicare Advantage and Part D involvement.  Since these private carriers, approved by CMS, potentially have a right to sue insurance carriers, including self insurance, for payments they make related to a workers’ compensation, liability or no-fault claim; it makes sense to identify and pay those claims.  Recall, that this right to sue includes a double damage penalty,  therefore it is definitely something to not leave to the Claimant or Claimant’s counsel to resolve.

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