State Medicaid Lien Resolution

Making a Complex System Simple for You

The Attorneys and Lien Resolution Specialists at MASSIVE have the knowledge of the processes and rules for hundreds of state Medicaid programs’ subrogation and third-party liability projects. While each state has its own rules, Federal Medicaid statutes mandate certain conditions before a state can facilitate third party recoveries. Specifically, each state must set up specific laws and directives under which both payment and then recovery can occur for medical services. Each state has specific laws regarding recovery rights and protective measures for plaintiffs.

Court Cases Affecting How Medicaid Liens Are Handled

Over the last 15 years, there have been important cases that have changed the ways in which Medicaid liens can impact your client's settlements. Due to the varying state Medicaid programs, and their methods of recovering payments from plaintiffs, there are often situations where the state runs afoul of federal anti-lien laws, which supersede the laws of the state. The attorneys for these victims must pursue these cases to the Supreme Court to obtain fair judgments for their clients.

In the process, the cases set important precedents that dictate how state Medicaid programs must go about collecting reimbursement for medical care. Eventually, these judgments became "the law of the land" and every state Medicaid program is expected to adhere to the Supreme Court guidance and federal anti-lien provisions when setting their lien regulations.

Books, a gavel, and scales of justice pictured on a desk.

Arkansas Department of Human Services v Ahlborn

Arkansas Department of Human Services v Ahlborn raised the question of whether Medicaid was entitled to your entire settlement in a personal injury case. The plaintiff in Ahlborn had been involved in a terrible car accident. She had no insurance at the time of her injury, and Medicaid covered her medical expenses. The total amount of medical expenses billed under Medicaid was about $215,000.

The plaintiff later sued for her car accident and her case was estimated to be worth about $3 million. Her attorney settled her case for less than 20% of what it was worth and resulted in a final settlement of $550,000.

When Medicaid saw that Ahlborn had settled her case, they demanded that they be reimbursed the entire $215,000 of claims. Ahlborn’s attorney argued that his client shouldn’t have to pay the entire thing due to the pain and suffering portion of her settlement not being subject to a lien by Medicaid or the State.

The Supreme Court ultimately decided that Ahlborn’s attorney was correct and ruled in her favor. Overall, the Court held that a legal settlement is the property of the plaintiff, not the State. The State was entitled to reimbursement, though, they were only entitled to the settlement money identified as medical expenses.


Prior to 2013, there were cases where Medicaid would take such a large chunk of plaintiffs’ money that they were left with next to nothing. Medicaid’s position was that they paid for medical care and they deserved to be reimbursed. They had no regard for how much of the settlement plaintiffs were left with, after the repayment of the lien.

A case in North Carolina changed all that. A baby was born and there were complications during her birth. Her family would be required to provide daily care for the rest of her life. Initially, the family sued for $42 million. Due to insurance policy limits, however, they ended up settling for just $2.8 million.

Medicaid stepped in and asked to be reimbursed for all the care they provided, while the case was pending. At the time, there was a statute in North Carolina that allowed the State to take 1/3 of a legal settlement in this situation.

The problem is, 1/3 of $2.8 million was more than the entire amount allocated to medical expenses. The statute obliterated the plaintiff’s share of the settlement proceeds and the plaintiff decided to file suit to appeal this decision.

The court rules in favor of the plaintiff in  WOS v EMA. They found that it's unreasonable for the State to take 1/3 of a settlement, regardless of how much had been allocated to medical expenses. In fact, the court held that any percentage would be arbitrary and thus, unreasonable. Something like this has to be determined on a case by case basis. Again shifting the 'law of the land', to be more protective of plaintiff's in future situations.

MASSIVE Can Be of Assistance to You By: 

  • Initiating contact with any state Medicaid or Managed Medicaid agency across all 50 states
  • Utilizing all applicable laws in the separate jurisdictions to ensure that your client's rights are fully protected
  • Maintaining our established relationships with state officials, in order to efficiently communicate during the Medicaid Lien Resolution process, safeguarding your client's interest and getting the best results in the shortest possible timeframe
  • Disputing and negotiating any Medicaid lien with agency officials, utilizing equitable, legal, and medical reasoning to reduce each lien to the fullest extent
  • Monitoring, reporting, and streamlining the entire lien resolution process for you, so that the hundreds of Medicaid and Managed Medicaid plans across all 50 states are no longer an impediment to your settling a case

Contact the Medicaid Lien Resolution Specialists at MASSIVE Today

The State Medicaid lien resolution specialists at MASSIVE can ensure that you retain as much of your client's settlement as possible, while satisfying any Medicaid liens. Through our evaluations of the explanation of benefits submitted by Medicaid, we may identify payments that are not tied to your cases, or do not fall under Medicaid's lien purview. Contact our specialists today to get a seasoned ally in your corner. They are experienced in communicating and negotiating with Medicaid to obtain the most desirable outcome for your clients. Call the experts at MASSIVE today to receive a risk-free case evaluation and begin the process of resolving your Medicaid lien.