Medicare warning...

[amazingflapjack]

Hi guys and gals. I wanted to alert everyone to a provision in the Medicare law that, we at least, were not aware of. I am not sure that it applies everywhere, even though it is a federal program, but I feel it would behoove anyone who has Medicare, or cares about someone who does have it to check out what I am going to share with you.

Last Spring, while taking my Wife to the doc, we were hit from behind while sitting at a red light, twice. My back was broken in 3 places. I was rushed to a Trauma Center, subsequently operated on, and when I was stable enough, went to a rehabilitation hospital. The facility we chose was not one approved by VA ( I am 100% Total and Permanent ), but was strongly suggested by the Trauma Team. The VA approved rehabs were basically nursing homes that were not recommended by the docs. The rehab hospital where we elected to go took Medicare, so we figured we were OK. We Weren't.

My lawyer had mentioned the possibility of Medicare wanting some of our settlement, but there was not a lot of conversation or info about it. Then, a couple of months ago, I received a demand letter from Medicare. They informed me that I had to pay back almost all of what had been paid for my hospitalization, and that if I did not pay it on time, I would be charged interest at the rate of 1000.00 a month. The law covering this demand was evidently passed in 1994. I wrote and asked that the charges be set aside. I stated that I was a total and permanent Viet Nam Vet, etc, and that I would have increased living costs as a result of this injury. NO DICE. They reduced it some, but I still had to pay it even though I had payed my Medicare for all these years (I'll be 70) and that the settlement that was the catalyst for this demand was the result of insurance I had payed for on my car. Look out if you collect a settlement-you will owe them. Best Regards, Flapjack.

 

[Absalom]

Sorry about your accident and injuries. That sounds like a real mess to deal with.

I'm curious what they wrote as the justification for the re-payment demand. You talk about the settlement, but from other things you say it sounds to me like Medicare thinks they shouldn't have to pay for your costs because you could have gotten the treatment for free or cheaper if you had used the VA services you were entitled to, rather than picking a non-approved facility. I wonder how they even found out about the settlement if that was a factor.

 

[pawngal]

Every time my husband was hospitalized there was a form to fill out and one part was, Is this the result of an accident? (or some such wording) This should have been answered yes, then the claim would go to the car insurance co. Either parties car insurance would be the primary insurance, not Medicare.

Perhaps this was not completed or something was not coded correctly for the claims.

 

[Arik]

Shouldn't the other guy be paying for this?

What is a total and permanent vet?

 

[chaparrito]

Sounds more like typical confusion over who the primary payer should have been.
What is the Medicare rule that if you recieve an insurance settlement you have to pay them back?

 

[chaparrito]

Yikes. I guess it's true.
Albuquerque Medicare Attorney :: Do I Have to Repay Medicare from my Personal Injury Settlement? :: Rio Rancho, New Mexico Personal Injury Claim Lawyer

 

[JSR III]

What is a total and permanent vet?

I think he meant that he is totally and permanently disabled.

Medicare probably figured that since an insurance company paid out a settlement for the accident that they should be reimbursed for their expenses. If they reimbursed for medical expenses then I can seen the logic. If however, the settlement was for pain and suffering and for the costs of living the rest of your life disabled, then they should not be entitled to a dime.

 

[Targets Guy]

Who's car insurance policy paid?

 

[Rpg]

This is called subrogation.

Virtually all health insurance plans include a provision that if you make a recovery from a third party ( the guy who hit you), the insurance company gets to recover what it spent from your recovery.

This prevents double dipping and keeps insurance costs down.

Otherwise, you would get the care paid by Medicare and then recover the cost of the care from the third party.

Your attorney should have explained this to you. Here in Colorado, this should be part of the fee agreement you sign with your lawyer.

 

[4011]

I ran into the rear of a car last year. I ended up with whiplash and lower back train. My chiropractor told me to use my PIP as Medicare would not pay if an accident was involved. He said if Medicare found that I was in an accident they would request that I pay back all funds paid for this. So I guess this is true.

 

[Rpg]

I ran into the rear of a car last year. I ended up with whiplash and lower back train. My chiropractor told me to use my PIP as Medicare would not pay if an accident was involved. He said if Medicare found that I was in an accident they would request that I pay back all funds paid for this. So I guess this is true.

Your chiro just wants the higher rates he gets from PIP compared to Medicare. Some PIP coverage does not include a subrogation provision.

In your case, there would be no third party recovery since the accident was your fault (he who rear ends someone else is virtually always at fault). Therefore, nothing to subrogate against.

 

[HOUSTON RICK]

...and if you had recovered any lost wages, they would be taxable income.

 

[vigil617]

I work with this all the time as a paralegal to a personal injury attorney. It does come as a surprise to some people who are injured by someone else, and who get medical treatment that Medicare pays for, that Medicare will require repayment of a portion of what it pays for the medical bills.

I'm very surprised that your attorney did not handle this part of the case for you, as far as doing the required corresponding with Medicare, getting notification of the required repayment amount, and completing the process to come up with the final amount. Often, the amount to be repaid to Medicare is kept back by the attorney, in trust, to be paid to Medicare on the client's behalf.

The good news is that what Medicare will eventually require to be repaid is much less than the total paid on your behalf. Sometimes, it will require no repayment at all, depending on the size of your settlement after attorneys fees, case expenses, and PIP (personal injury protection, sometimes called "medpay") are subtracted.

Speaking of PIP on your auto insurance policy: it's usually optional, but very inexpensive and can be a huge help if you're injured in a wreck. In a nutshell, you are entitled to recover money for your medical bills, up to the amount of coverage you selected, regardless of who was at fault in the wreck.

Even if your treatment was paid for by insurance, those PIP benefits are still available to you. You don't have to have an attorney representing you to get them, and they don't have to be paid directly to a medical provider if you don't authorize it. You can simply send copies of your medical bills (paid or unpaid) to your insurer, and request that the PIP payments be made to you. Then, you can decide how to spend that money.

 

[CAJUNLAWYER]

Sounds more like typical confusion over who the primary payer should have been.
What is the Medicare rule that if you recieve an insurance settlement you have to pay them back?

This is one of the most complicated things around and is a nightmare for a plaintiff lawyer. When a third party may be responsible for payment, medicare becomes a secondary payee and any payments made by medicare towards the accident injuries are referred to as conditional payments. Short story-medicare gets it's money back. Period. If your lawyer does not protect medicare's interests and disburses funds without taking care of the medicare lien he is personally liable as well. This is a freaking nightmare and any plaintiff attorney that is not aware of this and makes provision to provide for it is comitting mal practice.
This came about because people were double dipping . Get in a wreck-hospital sends you a huge bill that you present as part of your settlement package. Insurance company pays including "reimbursement" for the medical bills. But the provider already submitted them to medicare and got paid and wrote off the bill! So the plaintiff in essence got free medical care plus got paid for an amount he was not liable for. pretty neat little scam until the government woke up and realized that the public fisc was getting screwed. SO they fixed the problem and now the responsibility for payment falls where is should fall-on the tortfeasor and not the tax payer. I pretty much agree with it. Good government is a great thing....until it happens to you!!

 

[H Richard]

Cajunlawyer is absolutely correct. Medicare is payor of last resort. "Any" other insurance that may have liability for payment of your injury must pay first. I was a Director of Patient Financial Services at a 325 bed hospital that had a level 1 Trauma center, and we had these situations all the time. One particular "personal Injury" lawyer constantly requested we hold the cases and not bill Medicare until the case was settled, then when settled requested we bill Medicare, We refused and I had a instructional seminar for the local attorneys who tried to get "double dipping". The primary one in question finally believed me and spent 3 days sequestered in his house just studying the Medicare regulations and then called me to let me know I was correct.

 

[Wyo]

This is called subrogation.

Virtually all health insurance plans include a provision that if you make a recovery from a third party ( the guy who hit you), the insurance company gets to recover what it spent from your recovery.

This prevents double dipping and keeps insurance costs down.

Otherwise, you would get the care paid by Medicare and then recover the cost of the care from the third party.

Your attorney should have explained this to you. Here in Colorado, this should be part of the fee agreement you sign with your lawyer.

This is correct. Subrogation applies in virtually all situations involving accidents, medical care and third party liability. In Wyoming this also applies to Workers Compensation payments if you're injured at work. Your lawyer should have explained it better, but it's certainly not unusual.

 

[e3mrk]

I feel your pain.
The Government is a heartless beast that could not care less about a person. Due to their incompetence Social Security claim I owe them for ten years of over payments so They took my entire check and it looks like I will never see another one.
God Bless America!

 

[Alk8944]

This has nothing to do with medicare specifically, it is simply how insurance works. In your situation you are injured and your expenses are paid by your insurance company. If you were at-fault this would be the end of it!

In this case you were not at-fault, a third party was. You recovered damages from his insurance company to pay your medical bills. Your insurance company (Medicare) expects to be reimbursed for their expenses which were the result of the accident. Any insurance company would expect reimbursement under the circumstances. What is recovered from the other driver's insurance company is not intended to be a windfall for you, it is to pay medical bills.

Place yourself in the position of your insurance company. Wouldn't you expect to be compensated for your expenses paid for another party if they had collected from another insurance company? In P&C Insurance the concept is referred to as subrogation., probably in Accident & Health too! Whatever, the concept and application are the same. Fair? Of course it's fair!

 

[Practical]

A lot of people drive without insurance and there are a lot of illegal immigrants and criminal american citizens with no insurance.