On June 18, 2018 the U.S. Department of Justice’s Attorney’s Office for the Eastern District of Pennsylvania announced a recently concluded settlement with a plaintiff firm involving the repayment of Medicare Conditional Payments. The government’s investigation arose under the Medicare Secondary Payer provisions of the Social Security Act, which authorizes Medicare, as a secondary payer, to make conditional payments for medical items or services under certain circumstances. When an injured person receives a settlement or judgment, Medicare regulations require entities who receive the settlement or judgment proceeds, such as the injured person’s attorney, to repay Medicare within 60 days for its conditional payments.
In their claim, the government alleged that Rosenbaum failed to submit timely payment for nine (9) of his cases between May 10, 2011 through March 2, 2017. Pursuant to the Medicare Secondary Payer provisions of the Social Security Act,42 U.S.C. $ 1395y, if Medicare does not receive timely repayment, these same regulations permit the government to recover the conditional payments from the injured person’s attorney and others who received the settlement or judgment proceeds.
Under the terms of the settlement agreement, Rosenbaum agreed to pay a lump sum of $28,000. Rosenbaum also agreed to (1) designate a person at the firm responsible for paying Medicare secondary payer debts; (2) train the designated employee to ensure that the firm pays these debts on a timely basis; and (3) review any outstanding debts with the designated employee at least every six months to ensure compliance. In addition, Rosenbaum acknowledged that any failure to submit timely repayment of Medicare secondary payer debt may result in liability for the wrongful retention of a government overpayment under the False Claims Act. You can review the settlement agreement HERE
In their press announcement the United States Attorney’s Office for the Eastern District of Pennsylvania was clear.
“This settlement agreement should remind personal injury lawyers and others of their obligation to reimburse Medicare for conditional payments after receiving settlement or judgment proceeds for their clients. ‘When an attorney fails to reimburse Medicare, the United States can recover from the attorney—even if the attorney already transmitted the proceeds to the client,’ said U.S. Attorney William M. McSwain. ‘Congress enacted these rules to ensure timely repayment from responsible parties, and we intend to hold attorneys accountable for failing to make good on their obligations.’”
In addition to utilizing the Medicare Secondary Payer Act as means to ensure compliance, the U.S. Attorney’s office reminds trial counsel of the applicability of the Federal False Claim Act. As part of the settlement agreement Rosenbaum acknowledged:
“…failure to submit timely repayment of Medicare Secondary Payer debts may result in its liability for the wrongful retention of a government overpayment pursuant to the False Claims Act, 31 U.S.C. $$ 3729(a)(1XD), (G), and other applicable law.”
A violation of the False Claims Act can result in triple damages, attorney’s fees, and fines (per each fraudulent claim).
Synergy’s Medicare services are designed to ensure that the trial attorney complies with obligations to Medicare while at the same time making sure the injury victim realizes as much of their settlement proceeds as possible. Our Medicare Audit & Verification Services will take the entire Medicare reporting and auditing process off your plate and allow you to focus on what you do best. This service includes the utilization of a little known process allowing expedited disputing of unrelated charges and obtaining a final conditional payment amount before mediation.
Once settlement has been secured and a Final Demand obtained from Medicare, Synergy can continue working to add value to your case by attempting to secure a refund of the Final Demand payment from Medicare. To date, Synergy has obtained over $5,000,000 in refunds for our clients. Understanding the complex world of Medicare Conditional Payments is necessary to not only avoid potential pitfalls, but also to maximize your client’s recovery.
Jason D. Lazarus is the managing partner and founder of the Special Needs Law Firm; a Florida law firm that provides legal services related to public benefit preservation, liens and Medicare Secondary Payer compliance. He is also a founding Principal and Chief Executive Officer of Synergy Settlement Services, which offers healthcare lien resolution, Medicare secondary payer compliance services, pooled trust services, settlement asset management services and structured settlements.