Texas PI Firm Sued for Failure to Pay Medicare Lien

The US Attorney’s Office has filed suit against another personal injury law firm for failing to pay a Medicare lien. Previous similar actions have been settled with firms in the northeast and Atlantic coast that ignored liens. This time, the law firm paid something to Medicare, but tried to reduce the lien using improper, non-administrative methods.

The Underlying Case

This case involved a man named Tomas Tijerina, whose case settled for $70,000.00. Mr. Tijerina’s lien was nearly, or perhaps all of his net settlement: $42,643.05. It is apparent his attorneys disagreed with that amount; however, they sought state court intervention, rather than use the regular Medicare appeals process. The state court motion was improper; however, the firm convinced the Court to issue an order reducing Medicare’s Demand to $4,700.00 using apportionment arguments similar to those for Medicaid liens as set forth in Arkansas Dept. of Health v. Ahlborn. It goes without saying that Medicare is not Medicaid and its recovery rights arise under a different statute.

The Errors to Get Us Here

The $4,700 order is invalid against Medicare. First, the US Attorney argues the state District Court lacks jurisdiction over Medicare (a federal program); second, the US Attorney argues the order is likely improper and should be void under sovereign immunity; and, third, we can add that the Medicare program is entitled to deference under Chevron for the administrative process it has laid out.

Lessons From this Case

While the case is in its infancy, we expect the US Attorney to succeed. Mr. Tijerina’s attorneys will do well if they settle for any amount less than the current debt, including interest, $53,445.93. The attorneys are lucky the US Attorney is not attempting to collect double damages as set forth in US v. Harris.

There are multiple ways to reduce a Medicare lien within the administrative process. Disputing claims pre-settlement is a great start. If you have settled, use the same arguments as an appeal. Perhaps your client is in poor financial shape? Try a Financial Hardship Waiver. If all else fails, Regional CMS offices have the power to compromise Medicare’s claims. In the end, stay within the regular process, avoid getting sued.

MASSIVE is a national provider of subrogation and cost projection services, working at 100% capacity during the covid crisis. If you are concerned and would like to learn more, please give us a call at 248-213-8700 or email [email protected].