Source: Murnane Brandt Insurance Litigation Bulletin - Summer 2009

A NEW MEDICARE LAW COULD MAKE IT MORE DIFFICULT FOR PARTIES TO SETTLE PERSONAL INJURY CLAIMS

In December 2007, former President George W. Bush signed into law the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA) which institutes mandatory reporting requirements for group health, liability (including self-insurers), no-fault insurers and workers’ compensation insurers/plans.  The MMSEA protects Medicare’s interests in personal injury actions when the plaintiff is a Medicare beneficiary.  In order to accomplish this goal, Section 111 of the Act requires all insurers to determine whether a claimant is entitled to Medicare benefits and report certain information about those claims to the Secretary of Health and Human Services.  This requires the Responsible Reporting Entity (RRE) to continually check to determine if a claimant is a Medicare beneficiary until the claim is closed.

Additionally, the MMSEA requires RREs to electronically report any settlement, award, judgment or other payment to the Center for Medicare & Medicaid Services (CMS).  The penalty for non-compliance is $1,000 per day for each day the insurer is out of compliance.

MMSEA will apply to settlements on or after January 1, 2010 and those insurance companies who are responsible for reporting must register on CMS’ website between May 1 and September 20, 2009.  Starting July 1, 2009, all RREs must track and report claims to determine whether an injured claimant is a Medicare beneficiary.

This Insurance Litigation Bulletin is designed to keep our clients generally informed about developments in the law relating to this firm’s practice and should not be construed as legal advice or a legal opinion concerning any factual situation.  Specific facts may alter any legal result.  Nor is this Bulletin intended to create an attorney-client relationship. 

If you have any questions, or would like more information, please contact your Murnane Brandt attorney or any of the following individuals: