MEDICARE CONDITIONAL PAYMENTS

About Medicare Conditional Payments

Medicare is a government program that provides health insurance benefits to those above 65 years of age, the disabled, and those with end-stage renal disease. 42 U.S.C. § 1395c. Prior to 1980, Medicare generally paid for medical services whether or not the Medicare beneficiary was also covered by another health plan. The MSP statute, enacted in 1980 to reduce skyrocketing federal health care costs and protect the integrity of the Medicare system, makes Medicare the secondary payer for medical services provided to Medicare beneficiaries whenever payment is available from another primary payer.

The MSP requires Medicare beneficiaries exhaust all available insurance coverage before looking to Medicare’s coverage.

To that end, the MSP statute prohibits , Medicare from making any payment to a beneficiary for medical expenses if payment has been made, or can reasonably be expected to be made promptly under an automobile or liability insurance policy or plan (including a self-insured plan) or under no-fault insurance. 42 U.S.C. § 1395y(b)(2)(A)(i). If Medicare does make a payment, it is considered to be a “conditional payment” and if any other party later becomes responsible for payment of services already paid for by Medicare, then Medicare must be repaid.

This statutory framework creates a strong recovery right for Medicare, and is often said that Medicare has a “super lien.” Medicare can seek repayment of their “conditional payments” from any party associated with the settlement of the personal injury action, including the attorneys. Therefore satisfying Medicare’s “super lien” is often a stumbling block to settlement of the underlying action.

To avoid this stumbling block and increase the speed with which a personal injury case can be resolved there is a process for dealing with Medicare’s interest. When a Medicare enrollee files a claim for personal injuries, or hires an attorney to do so notice must be given to Medicare.

Once the underlying personal injury action has resolved settlement information needs to be provided to the Benefits Coordination and Recovery Center. Medicare will then issue Final Demand which must be repaid within 60 days or interest will begin to accrue.

Our service includes the audit and verification of conditional payments for cases that originate from a specific personal injury incident. The process includes reporting to the Centers for Medicare and Medicaid Services, the audit and dispute of Conditional Payment Summaries, the request for Final Demand, and this service includes 1st & 2nd level administrative appeals.

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