Medicare Secondary Payer Essentials: Private Plans, Part D, and the Treasury Threat
***NEWSLETTER***
As lien enforcement continues to evolve, Medicare is expanding its reach beyond traditional Part A and B claims. This segment of the Medicare Secondary Payer Essentials Series addresses three increasingly consequential topics for plaintiff attorneys: private Medicare Advantage Plans (MAPs), Medicare Part D prescription drug coverage, and what occurs when CMS refers your client’s debt to the United States Treasury for collection.
These three modules expose often overlooked compliance risks and offer proactive strategies to safeguard both your client’s recovery and your firm’s reputation.
Module 107: Working with Medicare Advantage Plans in Personal Injury Cases
Many attorneys are familiar with traditional Medicare liens. However, fewer are equipped to resolve recovery demands from private MAPs. This module explains how MAPs, offered by insurers such as Humana, UnitedHealthcare, and Aetna, rely on the same statutory authority as CMS: the Medicare Secondary Payer Act.
Key insights include:
- How MAPs identify settlement activity through CMS Section 111 reporting and initiate recovery efforts
- The increasing involvement of third-party collection vendors, including Rawlings and Optum
- The legal authority supporting MAPs’ private cause of action for double damages, as affirmed in In re Avandia
- Defense strategies for early identification of MAP liens and successful negotiation of repayment terms
Mastering MAP lien resolution is essential. The same federal enforcement structure that applies to traditional Medicare also governs these plans. Ignoring this process may expose attorneys to direct liability.
Module 108: D Plans, Prescription Drug Liens Are Increasing
Medicare Part D provides prescription drug coverage to more than 50 million beneficiaries. Despite this, most plaintiff attorneys do not address D Plan interests when resolving a case. This omission can jeopardize both client recovery and post-settlement compliance. Part D plans, whether stand-alone prescription drug plans or embedded within MAPs, are entitled to reimbursement under 42 United States Code section 1395w-102(4) and 42 Code of Federal Regulations section 423.462.
This module explores:
- The legal framework equating MAP and D Plan reimbursement rights
- CMS guidance confirming that Part D sponsors follow the same Medicare Secondary Payer rules
- How Section 111 query responses can help identify active D Plan coverage
- The potential impact of unaddressed drug claims on medical specials, compliance, and LMSA evaluations
While litigation concerning D Plan recovery remains rare, the trend indicates increased activity. Attorneys should remain vigilant and resolve D Plan exposure prior to disbursement.
Module 109: Treasury Claims, What Happens When CMS Escalates
Failure to resolve a conditional payment claim can trigger significant consequences. When a lien remains unpaid, CMS may escalate the matter and refer the debt to the United States Treasury for collection. This module clarifies that process and outlines the enforcement tools used by Treasury and the Department of Justice.
Important takeaways include:
- A conditional payment becomes delinquent 65 days after the final demand letter
- At 120 days of delinquency, CMS refers the debt to Treasury as required by federal statute
- Treasury may pursue recovery through Social Security offsets, tax refund garnishment, third-party collection agencies, and legal action by DOJ
- Although referral applies only to traditional Medicare debts, the reputational risk and client relationship impact are significant
Treasury recovered over 47 million dollars in conditional payments in 2024 alone. The consequences are real and should never be underestimated.
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The Medicare Module Series is now available exclusively on the Lien Project Network. Each session is available on demand, complete with downloadable documents, citations, case law, and practical application.
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For a deeper dive into lien resolution strategies, settlement planning, and reimbursement challenges, explore our educational modules. Lien Project Network serves as a trusted resource for plaintiff attorneys, providing insights on financial planning, public benefits, and structured settlements in the context of lien management.
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If you need expert legal assistance in navigating lien resolution, reimbursement claims, or settlement planning, our team at The Lien Project, PC is ready to help. As an LPN member, you earn credits that can be applied toward lien reduction and resolution services provided by The Lien Project, PC, allowing you to offset up to $900 per year. Your investment in continuing education through Lien Project Network not only enhances your lien resolution skills but also reduces the cost of engaging legal experts when needed.
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