Lien Resolution FAQ
How long does the lien resolution process usually take?
Anywhere from 30 days to 5 months, depending on the type of lien(s). Medicare’s guidelines allow for 30-45 days to respond to each request, making the full resolution of a Medicare lien possible in 2 ½ – 4 months. Some situations, like compromises or waiver requests, may extend the timeframe for Medicare resolution to six months or more. Resolution time for Tricare/VA liens may be reached in as little as 3 to 6 months. However, as these liens are handled by various JAG offices throughout the United States, resolution time varies and may be prolonged based on the individual volume and staffing levels of each office. Similarly, Medicaid and ERISA/Private Insurance liens vary as these agencies do not abide by the same guidelines. Synergy’s lien resolution analysts are focused on effective case management that ensures quality as well as the shortest turnaround time possible.
Can I release funds to my client before the lien has been resolved?
It is not suggested that funds be released before the liens are resolved and confirmed in writing. In cases where there may be need-based benefits such as Medicaid/SSI, the distribution of funds may affect the claimant’s eligibility. Distributing funds before a valid lien is resolved can have consequences for both attorney and client. However in some cases, if there is a guarantee that a lien holder will not increase their lien amount, a holdback may be recommended.
What if my client decides not to resolve his outstanding liens? Is there anything I can do?
In a situation where a claimant has been awarded funds, and is responsible for resolving all outstanding liens with their respective lien holders, some may choose not to pay their insurers for benefits previously received. It is not a good idea to advise a claimant to “spend down” or divert funds into a trust or other type of investment. In fact, the avoidance of repaying valid liens may put the attorney in a position where both you and the claimant are liable for the outstanding liens as well as any penalties. It is the attorney’s responsibility to educate their client about their obligation to address and resolve all liens. Lien holders may be within their rights to seek recovery directly from the claimant even if funds have been distributed, with no definite statute of limitations. If a Medicare lien is involved, failure to address Medicare’s interest may result in the accrual of interest and the garnishment of Social Security benefits until the debt is repaid. Claimants must be made aware of their contractual obligations and the possible consequences before being allowed to make such an important decision.
Can our client lose their benefits after receiving a settlement?
If your client is receiving a need-based (low income) benefit like Medicaid or SSI, a settlement or award may impact their eligibility for benefits.