USSC Decide ERISA Subrogation Case
The SCOTUS has decided the Sereboff v. Mid Atlantic Medical Services, Inc. case - the long awaited case that was to tell us about an ERISA plan's right to seek reimbursement of medical payments from a tort recovery.
The Court held that the payments were recoverable.
The case was decided on May 15, 2006. The case number is 05-260.
Read the opinion here.
Sereboff clearly held that Erisa plans can seek subrogation.Perhaps it overruled Qualchoice on that issue.Did Sereboff rule that the Erisa plan trumps made whole ? How do we use Sereboff footnote 2? Can the plan get the entire third party recovery? In Sereboff attorney fees were awarded, but there was no discussion whether Erisa plan must pay fees/expenses.Perhaps the Ahlborn Supreme Court decision can be used to limit the extent of the Erisa subro? Lots of questions, but this is very important to all of us and our clients. It may be time to seek some answers.--- Don Ray, Tullahoma
Right now, the jury appears to still be out on the effect of Ahlborn re Medicaid. Further, we have begun seeing a rise in Rawlings Co. assertion of ERISA-type subrogation liens attempting to gain reimbursement re welfare payments. Seems to me that someone is attempting an end-run around Ahlborn and may run straight into Sereboff.
Clearly, in CT, the matter is not clear. Further with the law v. equity split in the Circuits re ERISA subro rights, we are likely in for a long, dark ride before these matters are resolved.
I'd love to hear others' thoughts on the matter.
In Sereboff, attorney's fees were awarded because the health plan language specifically stated that they would pay for reasonable attorney's fees. The key answer lies in the health plan language itself, re common fund and made-whole.