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Medicare to the claim are actually related and that the medicals lumped under those codes are also related. There are many instances in which a physician has included a prior diagnostic code for low back pain on a routine medical visit but no treatment was rendered for low back pain on that visit. Of course, a routine medical follow-up for refill of blood pressure medications has nothing to do with a knee injury claim, but Medicare doesn’t know that. It is up to the attorneys to separate out what is and is not related. When entering into a settlement involving a Medicare beneficiary (or someone who is reasonably expected to become a Medicare beneficiary in the near future) who will require future medical treatment, the attorneys must show some consideration toward protecting Medicare’s interests. The parties are free to prepare their own informal Medicare Set-Aside or allocate a portion of the settlement funds to go towards future medicals. Of course, a more formal Medicare Set-Aside is also acceptable. The problem remains that there is no review by CMS for any of the above, such as the system in place for workers’ compensation claims. ...put attorneys at risk for potential malpractice claims... In an interesting case, Benoit v. Neustrom1, the United States District Court in Louisiana considered a settlement agreement reached by the parties in an underlying liability lawsuit. The parties petitioned the court for review by way of a Motion for Declaratory Judgment, asking the court to approve the agreement that calculated the future potential medical expenses for the plaintiff ’s medical treatment when the settlement amount was not sufficient to provide a set-aside totaling 100% of the MSA proposal. Prior to settlement, the parties obtained an MSA proposal that projected future medicals totaling $277,758.62-$333,267.02. The defendants pointed out that the case was defensible, and the parties had reached a settlement in the amount of $100,000. That total settlement amount was reduced to $55,707.98, after payment of attorney fees, expenses and reimbursement of the Medicare conditional payment/lien. Based on those figures, the federal court reasoned as follows: The net settlement proceeds, after reimbursement of conditional payments to Medicare is $55,707.98. The mid-point range in the MSA projections is $305,512.50. The net settlement is 18.2% of that figure. Using that percentage applied to the net settlement proceeds, the sum of money to be set aside in trust for future medical expenses is $10,138.00. The Court finds that this amount adequately protects Medicare’s interests and should be available to provide funding for future medical items or services related to what was claimed and released in this lawsuit that would otherwise by covered or reimbursable by Medicare. The court pointed out that there is no other procedure by which to determine whether a settlement that addresses future medicals adequately protects Medicare’s interests. Additionally, there is strong public policy in favor of parties resolving lawsuits by way of settlement. As such, the federal court found that the agreement reached by the parties in that lawsuit did adequately protect Medicare’s interests. Obviously, federal courts are not going to review every settlement agreement that addresses future medicals pertaining to a Medicare beneficiary. The following are some helpful recommendations I would encourage attorneys on both sides of the liability lawsuit to keep in mind: • Keep up to date on evolving CMS/MSP guidelines and recommendations. www.cms.gov is a good place to start. • Review and analyze every injury-related case that involves a current or potential Medicare beneficiary. • Avoid using boilerplate language in releases - tailor each one with specific of the case, defenses asserted, causation issues that are present, etc. • Obtain medical testimony and/or written confirmation from the treating physician regarding future medical treatment that can be attached to the settlement agreement. The most important thing to always keep in mind is that Medicare is expecting that its interests are being protected. Do something to show that you are not just ignoring Medicare and hoping it won’t come back to bite you. Since there is no formal review as of yet, it is my opinion that doing something to address Medicare’s interests should be sufficient . . . for now. G Jennifer Pickett. 12013 U.S. Dist. LEXIS 55971 (April 17, 2013). Birmingham Bar Bulletin/ Winter 2017 17


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