Medicare Set Aside and MMSEA Section 111 Legal Cases - U.S. v. Harris

Blackburn Group, Inc. MSA and MMSEA Section 111 Legal Cases - US v. Harris, No. 5:08 CV 102, 2009 WL 891931 (D. N.D. W. Va., March 26, 2009)

This case commenced from an incident in which Mr. Ritchea fell off a ladder. Mr. Ritchea hired Mr. Harris as his attorney to represent him for his personal injury claim. Mr. Harris then filed an action against the ladder retailer which eventually settled the case for $25,000.

Since Mr. Ritchea was a Medicare beneficiary, Mr. Harris notified Medicare of the settlement and requested their conditional payment amount. In response, Medicare made a recovery demand in the amount of $10,253.39 and advised that any appeal had to be filed with 120 days. Neither the plaintiff nor his attorney tendered reimbursement or filed an appeal within 120 days. Medicare then sued Mr. Harris for reimbursement of its conditional payment amount.

The court ruled in Medicare's favor and held Mr. Harris personally liable to reimburse Medicare's conditional payment claim (plus accrued interest). In reaching its decision, the court said that under the Medicare Secondary Payer Statute (MSP) Medicare has the right to seek reimbursement from a variety parties of who "receive" settlement payments, including attorneys (42 C.F.R. § 411.24(g)). Additionally, Medicare can also seek reimbursement from parties that are responsible for "making" primary payment (42 U.S.C. § 1395y(b)(2)(B)(iii)). The court also held that Mr. Harris' failure to pursue administrative remedies (i.e. his failure to file a timely appeal) precluded him from now challenging Medicare's reimbursement determination.