Medicare makes conditional payments to health care providers on behalf of its beneficiaries who are injured or killed and later assert personal injury or wrongful death claims. Federal law requires that the monies advanced by Medicare be paid back subject to a formula that allows for the reduction of the advanced, conditional payments for certain expenses incurred by the beneficiary in securing the funds. Occasionally, further reductions are granted. Law firms have the obligation to use reasonable efforts to determine if Medicare has made conditional payments and if so, work with Medicare to determine the proper amount of its gross and net financial interest and then ensure those monies are withheld from the proceeds and paid to Medicare.
The federal government has recently collected money from three plaintiff’s law firms for the alleged failure to do so. One firm was required to pay $28,000, another $250,000, and, most recently, another $90,000. It is unclear from the attached documents whether the payments in each case were entirely from firm funds or whether the payments also included client monies. It does seem clear, in the case involving the $28,000 payment, the monies came from the owner of the firm:
Under the terms of the settlement with the DOJ, the firm’s principal agreed to pay a lump sum of $28,000.00. In addition, the firm agreed to (1) designate a person responsible for paying Medicare secondary payer debts; (2) train the designated employee to ensure that the firm pays these debts on a timely basis; and (3) review any outstanding debts with the designated employee at least every six months to ensure compliance. In addition, the firm acknowledged that any failure to submit timely repayment of Medicare secondary payer debt may result in liability under the False Claims Act.