Personal Injury Law Regarding Medicare Reimbursement

Personal injury law in which the injured party is covered by Medicare is different than when the injured party is without medical insurance or covered by private insurance. When Medicare is involved, the type and payment of an award is changed.

The Collateral Source Rule

Personal injury compensation awards are governed by many different rules, one of which is commonly referred to as the “Collateral Source Rule”. This rule states that an injured party’s compensation will be reduced by the amount of money he is receiving from third parties. Third parties include medical insurance companies. In this case, the award would be reduced by the amount of funds received to date and the amount expected to be received in the future.

Medicare Operating Rules

Medicare rules clearly state that a beneficiary has to exhaust all other forms of payment that can be expected within 120 days before payments will begin. Accordingly, Medicare may refuse to pay for treatment if payment is derived from elsewhere. However, there is very little oversight for whether a party will be receiving third party compensation.

However, Medicare also allows for conditional payments. These payments are made when it is possible that the beneficiary will receive payment from another source, but payment will be received after 120 days.

Medicare Reimbursement

A party covered by Medicare is required to reimburse Medicare for any payments received for medical treatment that were previously paid by Medicare. This requires the beneficiary to write a check for these costs directly to Medicare. It is the beneficiary or his attorney’s obligation to inform Medicare of any settlement and forthcoming payment.

Medicare Subrogation of Party Rights

In some instances, Medicare can subrogate a party’s compensation rights. Subrogation occurs when one party assumes and takes over the rights of another party. This means that Medicare would assume the injured party’s rights to sue for compensation for his injury. Technically, it would be Medicare that would sue the responsible party or insurance company to obtain reimbursement for the money spent on the injured party’s treatment. If Medicare won funds over and beyond the cost of medical bills, that money would either be put in trust for the party’s future medical care or be given to the party.

Getting Legal Help

If you are involved in a personal injury case in which Medicare coverage is an issue, seek legal assistance. An attorney will review the facts of the case and discuss the Medicare reimbursement rules more thoroughly.

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