Sometimes I wonder if injured parties are going to be able to get their foot in the door of the courthouse 20 years from now. I feel like it’s pressing in on all sides: most of my fellow Flathead valley neighbors think personal injury lawyers like myself are quick-talking snake-oil salespeople, insurance companies have been acting in bolder and more difficult ways and Medicare. Right. And Medicare.
Medicare is government. As everyone knows, government is the poster child for inefficiency. And, for that matter, carrying a big stick. Which is currently Medicare’s position on personal injury. Inefficient, big-stick.
The current issue in the field of personal injury is Medicare’s rules –or, rather, unclear pseudo rules– regarding respective parties’ responsibilities in “third-party liability settlements.” What happens is this: Medicare beneficiary gets hurt. It’s somebody else’s fault. At-fault person carries insurance. At-fault insurance pays some medical bills and then a settlement. Federal Medicare law requires two things: that Medicare be reimbursed for medical bills and that injured beneficiaries “protect” Medicare’s “future interests.”
I’m confident you can spot the issue here. It’s relatively straight-forward, albeit time-consuming, to figure out the “past” medical expenses. But … what in the sam-hill does “protect Medicare’s future interests” mean?
Even the smartest and most informed lawyers on this subject’s best guess is just that: a guess. Congress has made no effort to define. Medicare has given no meaningful directives. And lower, non-binding court decisions are dancing all around the issue.
Add to the mix what’s clear: if an insurance company doesn’t report a settlement properly, there’s a big financial penalty (to the tune of $1,000 per day per non-compliance).
So there’s this mass paralysis, paranoia and psychosis that accompanies almost any Medicare beneficiary who tries to settle their case against a third-party insurance. Frustratingly, there’s no cure for this, and all we can do is spend a bunch of time and money trying to iron things out. At the end of the day I have increasingly found myself in the unenviable position of telling injured clients: we should probably settle for X, but I can’t tell you how much money will be left over after Medicare is taken care of and there’s a chance that sometime in the future Medicare will cut off your benefits wrongly and we’ll have to spend more time and money ironing that out.
It’s the tale of an inefficient, big-stick resulting in Medicare-related paralysis, paranoia and psychosis.