If you have been injured in an accident and Medicaid has paid for any of your medical care, Medicaid will have a lien on your settlement, which means that it is entitled to be reimbursed from your settlement.
What is a Medicaid Lien?
Medicaid is a federal and state run program that provides health benefits to many of the most financially-disadvantaged in our society. Many women and children received Medicaid benefits. Because Medicaid is a state-run program that is funded through taxes, Medicaid has a right to be reimbursed by the at-fault party when an injured person receives a settlement or judgement against the at-fault party.
Should Medicaid Have A Right To Reimbursement?
In other blog posts, I have written that health insurers and Medicare should not be entitled to reimbursement from a personal injury settlement because the insureds and/or beneficiaries have already paid for the benefit of receiving health insurance and/or Medicare (through paying taxes, serving as an employee, and paying health insurance premiums). This same consideration does not apply to Medicaid because those receiving the Medicaid benefits may not have paid taxes for the receipt of those benefits. However, forcing those who are already among the most-financially disadvantaged in our society to reimburse Medicaid further harms these people, most of whom are women and children. In addition, these people have been injured, and as a policy matter we shouldn’t force those in poverty who have been injured to reimburse their state-provided health benefits.
How Does Medicaid Affect the Value of a Settlement?
In Missouri and Kansas, if a person has been injured due to another person’s negligence, insurance companies will often find any basis they can to deny claims or to pay as little as possible on claims, thereby forcing people to file suit. Many people don’t realize that suit is actually filed against the at-fault person and not against the insurance company (except for 1st party claims). Thus, if another driver negligently hurts you, your lawsuit would be against that driver, not the driver’s insurance company. However, the other driver’s insurance company hires the defense attorney and pays the defense attorney, and it will ultimately pay any jury verdict, up to the policy limit.
Unfortunately, juries in Kansas and Missouri are never allowed to be told that a defendant has insurance, even though in the major majority of cases, the defendant either has insurance or substantial assets to satisfy any judgment against the defendant. Both the insurance industry and the Chamber of Commerce have funded and helped ensure that juries do not ever get to know that insurance exists.
The insurance industry and the Chamber of Commerce have also funded many other bills to limit an injured party’s ability to recover as part of their ongoing effort to make people believe that tort reform is needed. For example, in Missouri and Kansas, healthcare providers will often bill a certain amount and discount their bill in certain situations. They may provide an adjusted (i.e. lower) rate for certain health insurance companies, they may give discounts for prompt payment, and they may provide charitable discounts or write-offs. Juries are often asked to compensate an injured person for their past medical bills, and the parties often fight over whether the jury gets to see the amount billed by the healthcare providers or the amount needed to satisfy the bill.
As the law stands right now, juries are able to see both amounts, but they are given very little instruction on what to do with those amounts.
Healthcare providers uniformly agree that they lose money when they provide services to Medicaid recipients because the amount reimbursed is so low. I’ve had clients with a $10,000 emergency room bill, but the amount Medicaid reimbursed was $200. Thus, a jury has to decide whether to award past medical bills in this scenario of $10,000 or $200. The fact that healthcare providers uniformly agree that the Medicaid reimbursement amount is not a reasonable value for the medical services indicates that the $200 amount is not an appropriate amount upon which to base the value of past medical bills. But, Medicaid recipients are further harmed because juries get to see these lower amounts.
As an aside, allowing juries to see the lower amounts accepted by any healthcare provider is cause for concern. If you have health insurance, you have paid for the benefit of getting a discount from the healthcare provider (through payment of premiums and or service to your employer), and the at-fault party should not be given the benefit of your years of service or the premiums that you have paid.
How Can You Reduce Medicaid Liens?
Your Medicaid lien may seem substantial, but your personal injury attorney may be able to get it reduced or resolved, depending on your circumstances. Your attorney will verify that the Medicaid lien is valid and that every line item is directly related to the accident before Medicaid receives any funds from your settlement.
Talk to Your Personal Injury Lawyer
Resolving Medicaid liens can be a complicated and overwhelming process, and it is always wise to make sure you have a personal injury attorney experienced with resolving Medicaid liens. If you have been involved in an accident, or if you want to talk with an attorney about making sure any liens are handled appropriately, call Aaron House today for a free consultation at 816-875-4260.
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