CMS Liens and Plaintiffs Lawyer
James Ritchea was injured on approximately May 22, 2002, when he fell from a ladder purchased from a local retailer. The Centers for Medicare and Medicaid (CMS) paid $22,549.67 in Medicare claims submitted on behalf of Mr. Ritchea for medical services rendered.
Mr. Ritchea obtained attorney Paul Harris to represent him in a legal proceeding against the ladder retailer alleging that the retailer was liable for Mr. Ritchea's injuries. The legal proceeding was settled in July 2005 and, as part of the settlement, Mr. Ritchea and his attorney received a payment of $25,000.
Mr. Ritchea's attorney forwarded CMS settlement information, including attorney's fees and costs. CMS calculated its lien amount, which was approximately $10,253.59. CMS allegedly was not paid its lien amount within the statutorily-required sixty (60) day time period and is now asserting a claim that it is entitled to its calculated share of the settlement plus interest and that it will not pay its full share of attorney's fees and costs. The total payment CMS is demanding is $11,367.78.
The federal government filed a complaint against Mr. Ritchea's attorney for declaratory judgment and money damages owed to CMS in the United States District Court for the Northern District of West Virginia. Defendant Harris filed a motion to dismiss but failed to file a specific response to the government's allegations. The District Court denied Harris' motion to dismiss on November 13, 2008.
In its opinion, the District Court in Harris stated that "Section 1395y (b) (2) (B) (ii) of the Social Security Act, commonly known as the Medicare Secondary Payer Statute ("MSPS"), states, in pertinent part, that when Medicare makes a conditional payment for medical services received as a result of an injury caused by another party, the government has a right of recovery for the conditional payment amount against any entity responsible for making the primary payment". The Court continued, saying that according to federal regulation 42 C.F.R. Section 411.24 (g), to recover payment, the government may "bring an action against any or all entities that are or were required or responsible...to make payment with respect to the same item or service...under a primary plan." 42 U.S.C. Section 1395y (b) (2) (B) (iii). CMS has a right of action to recover its payments from any entity, including a beneficiary provider, supplier, physician, attorney, State agency, or private insurer that has received a primary payment.
This case is a reminder that repayment of Medicare liens is required by the federal government. Failure to comply could place the attorney in the position of being held personally responsible.
