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Medicare “Liens”: Departure From The Past Continues With Medicare Advantage Plans and Private Causes of Action

June 2018

By Paul W. Pasche

When Medicare was created in 1965, the original legislation made Medicare “secondary” to workers’ compensation (WC), and Medicare was not supposed to pay for any expenses that were covered under a WC claim. In 1980, Congress expanded this idea into the area of liability and no-fault cases. For years, insurers, attorneys, and parties to litigation could simply contact Medicare and negotiate a resolution of any medical bills paid by Medicare that were related to a particular claim. In the past decade or so, Medicare has ramped up its efforts to collect “conditional payments,” so-named because Medicare pays the bills on condition that the “primary” insurance will later reimburse Medicare. The Centers for Medicare and Medicaid Services (CMS) has set up two different contractors to handle conditional payments: the Benefits Coordination & Recovery Center (BCRC) and the Commercial Repayment Center (CRC), and different procedures apply to each contractor, including differentiating the party or parties with whom Medicare will even communicate. Failure to pay back conditional payments can subject a primary plan to double damages, interest, and litigation costs. As labyrinthine as this system may already seem, any liable party or insurer needs to beware that the BCRC and CRC only handle “traditional” Medicare, which includes Medicare Part A (hospitalization) and Part B (medical) coverage where Medicare has made payments directly to the health care providers.

LMSAs: Is 2018 the Year?

June 2018

By Nicole L. Wiza

As we enter into the second half 2018, the anticipation surrounding reform of Medicare Set-Asides (MSAs) in liability and no-fault claims is growing. However, recent discussions by CMS reveal that it is not likely any formal process will be adopted soon. Over the last nearly 20 years, The Centers for Medicare and Medicaid Services (CMS) has provided a number of guidelines, thresholds, and policies for navigating the MSA process in Workers’ Compensation claims. However, the same has not been formalized for liability and no-fault claims … yet. All signs seem to point to potentially big changes for Liability Medicare Set-Asides (LMSAs) in the near future. Or at least in the future.

What are these signs of change? Initial rumblings of the formalization of the LMSA process started back in 2016. At that time CMS announced intentions to plan a series of town hall meetings to address reforms. Then, CMS advised Medicare and its contractors, effective October, 2017, to begin rejecting medical claims submitted post-resolution of a liability settlement on the basis the claims should be paid out of an LMSA. In concert with its search for a new set-aside review contractor in 2017, the CMS “job posting” requested the contractor provide review of liability and no-fault MSA submissions in addition to workers’ compensation MSAs. The amount of the contract with the new reviewer was purported to be more than 10 times the dollar amount received by the previous contractor. Speculation loomed that the large increase in the contract value signaled an increase in the expected workload if/when voluntary submission thresholds were added for Liability and No-Fault MSAs.

The Crystal Ball: Using Medical Investigation to Predict Future Medical Exposure

June 2018

By Marina Takagi

With cases involving complicated medical issues, the idea of shutting down medical rights due to potential future medical exposure seems daunting and unpredictable. However, with thorough medical investigation, BCM’s Medicare Compliance Department is able to foresee potential exposure for a Medicare Set-Aside Arrangement (MSA), and recommend the best legal course of action to resolve the claim.

In such a case, the petitioner was a younger employee that alleged exposure to chemicals in the workplace. This was the beginning of the petitioner’s extensive treatment for scleroderma, Raynaud’s syndrome, pulmonary fibrosis, and systemic sclerosis. Ultimately, the petitioner underwent a lung transplant. Following the transplant, the petitioner continued treatment required to avoid transplant rejection, as well as treatment to combat numerous infections.

The Firm Defeats Marque Medicos’ Claim for Interest

May 2018

By W. Scott Trench

On May 4, 2018, Brady Connolly & Masuda, P.C. Attorney, W. Scott Trench, obtained a dismissal with prejudice in a lawsuit filed by Marque Medicos against a workers’ compensation insurer and its insured employer seeking recovery of statutory interest under Section 8.2(d) of the Illinois Workers’ Compensation Act for late payment of medical bills. Soon after the lawsuit was filed, the Illinois Appellate Court issued a decision in a putative class action lawsuit filed by Marque Medicos against numerous insurance companies for unpaid statutory interest. Marque Medicos v. Zurich, et al., 2017 Il.App. (1st) 160756. In the class action lawsuit, the appellate court held that Section 8.2(d) of the Act provided no private cause of action and affirmed dismissal of the lawsuit with prejudice.

In an effort to side step the Appellate Court’s decision in the class action lawsuit, Marque Medicos amended its complaint, asserting entitlement to recover statutory interest under the equitable theory of unjust enrichment – a cause of action which was not at issue in the class action lawsuit. In response, the defendants filed motions to dismiss the amended complaint. The motions argued that Marque Medicos’ clever pleading should not change the end result. Since the statute affords no private cause of action, Marque Medicos’ complaint should be dismissed no matter what label was placed on its cause of action.

Illinois Comp By The Numbers

May 2018

By Francis M. Brady

Outside influences can redirect the course of Illinois Workers’ Compensation Practice. Recent publications from two of them, the Workers’ Compensation Research Institute and the Illinois Legislature, have the potential to do just that.

WCRI, an independent, not-for-profit facility, located in Cambridge, Massachusetts, mines data from numerous sources, assesses it, and publishes various studies and reports. Its mission is not to advocate positions but, instead, to assist workers’ compensation policy makers and stakeholders in improving their systems.

Shining the Light on Trial Preparation

May 2018

By Nicholas A. Rubino

In the case of Bobby Sims v. Berwyn South School District #100 the accident occurred when petitioner, who traveled from school building to school building performing maintenance functions, fell in a stairwell on district property. He claimed he couldn’t see the bottom steps because of poor lighting and, as a result, missed one, twisting his knee and sustaining a meniscus tear.

Trial preparation included two site inspections, one done exactly a year from the original accident and at the same time of day. That precision proved key as it conclusively demonstrated that at the time petitioner fell, the stairwell would have been illuminated by natural light flooding through an exterior window. Moreover, the pertinent entries from the Farmer’s Almanac were consulted and confirmed that lighting conditions in the stairwell upon the inspections were identical to the date of the alleged loss. Both inspections were well documented by photographs.

  • Chicago Bar Association
  • Workers' Compensation Lawyers Association
  • DRI - The Voice of the Defense Bar
  • The Illinois Association of Defense Trial Counsel
  • Chicago Bar Association
  • Workers' Compensation Lawyers Association
  • DRI - The Voice of the Defense Bar
  • The Illinois Association of Defense Trial Counsel
10 South LaSalle Street, Suite 900
Chicago, IL 60603
Phone: 312-425-3131
211 Landmark Drive, Suite C2
Normal, IL 61761
Phone: 309-862-4914
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