Medicare Recovery Claims (“Medicare Liens”) in Personal Injury Cases
Published .
When a Medicare beneficiary receives money from a personal-injury claim, Medicare may have a right to recover conditional payments it made for treatment related to the injury. Lawyers and claimants often call this a “Medicare lien.” The more precise concept is a Medicare Secondary Payer recovery claim.
Why Medicare may have a recovery claim
The Medicare Secondary Payer statute generally makes liability insurance, no-fault insurance, and workers’ compensation primary to Medicare for medical expenses for which those sources are responsible. When a primary source does not pay promptly, Medicare may make a conditional payment. Medicare may later seek reimbursement when a settlement, judgment, award, or other payment establishes responsibility.
A settlement does not make every Medicare payment recoverable. The claimed payments must be examined for their relationship to the injury or condition involved in the claim or release.
Reporting, conditional payments, and the final demand
A Medicare beneficiary or representative should report a liability, no-fault, or workers’ compensation claim through the Medicare Secondary Payer recovery process. Conditional-payment information is interim and should be reviewed carefully; unrelated items may be disputed with supporting information. After settlement, judgment, award, or other payment is reported, Medicare determines its formal recovery demand. That amount may differ from an earlier conditional-payment figure. Federal regulations may reduce recovery to account for qualifying procurement costs, including attorney fees and litigation expenses.
Why the issue should be handled before disbursement
The better practice is to identify Medicare status early, report the case, review conditional payments, challenge unrelated items, update settlement information promptly, and resolve the final demand as part of settlement administration. Medicare’s federal recovery right should be distinguished from Medicaid recovery, Medicare Advantage or Part D claims, ERISA or other private-plan subrogation, TRICARE recovery, and provider balances.
Medicare recovery is not the same as a Medicare Set-Aside
A past-payment recovery claim concerns conditional payments Medicare already made. A Medicare Set-Aside concerns future medical expenses. CMS maintains a formal review process for Workers’ Compensation Medicare Set-Aside arrangements; a liability settlement should not automatically be treated as though every tort case requires a CMS-approved Medicare Set-Aside.
Related Maryland Cases and Authorities
- 42 U.S.C. § 1395y(b) — Medicare Secondary Payer provisions.
- 42 C.F.R. Part 411 — Medicare Secondary Payer regulations, including recovery provisions.
- Centers for Medicare & Medicaid Services — Medicare Secondary Payer recovery-process guidance.