The Provide Accurate Information Directly Act (PAID)

The Provide Accurate Information Directly Act (PAID)

Revealing Your Clients’ Medicare Advantage and Medicare Coverage and “Liens”

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As Medicare Advantage Organizations (MAOs) continue to gain ground in asserting recovery rights under the Secondary Payer Act (SPA), the impact of these efforts continues to create significant barriers to resolving liability claims. A large part of this disconnect stems from the inability of liability carriers to determine whether a Medicare beneficiary is enrolled in a MAO—and if so, which one and for what time period. The same is true when it comes to identifying a Medicare beneficiary’s coverage under a Medicare Part D prescription drug policy.

Liability carriers have developed policies and practices to meet their reporting obligations under the Medicare and Medicaid SCHIP Extension Act of 2007 (MMSEA). These requirements include submitting to CMS the claimant’s identifying information, the nature of the claimed injuries (via ICD-10 codes), name of counsel, and more. This data is entered into the beneficiary’s Common Working File (CWF). While MMSEA allows liability carriers to query the system to verify enrollment in traditional Medicare Parts A (hospital) and B (medical), it does not provide information about whether the claimant has been enrolled in a Medicare Advantage Plan or Medicare Part D coverage.

The result? Liability claims are often settled without ever identifying or addressing the conditional payment claims asserted by MAOs or Part D sponsors. With CMS beneficiaries frequently switching between traditional Medicare and various MAO and Part D plans, tracking potential lien holders becomes entirely dependent on the claimant’s own records—which are often incomplete or nonexistent.

While liability carriers attempt to protect themselves through indemnity and hold harmless provisions in settlement agreements, they remain prime targets for enforcement under the SPA and risk exposure to double damages if liens are not properly addressed.

HERE’S A SOLUTION

Help may be on the horizon with the Provide Accurate Information Directly (PAID) Act, currently pending before both chambers of Congress. The PAID Act would require CMS to include a beneficiary’s enrollment status in MAOs and/or Part D plans in their Common Working File data. Significantly, it would also allow plaintiff’s counsel to query the system and access the same information available to liability carriers.

This would be a game changer: enabling early identification of potential lienholders and allowing for proactive resolution efforts. All stakeholders would benefit from settlements that fully and finally resolve every component of the case—including reimbursement claims.

While the PAID Act would help identify MAO and Part D lienholders, resolving those liens efficiently still presents a unique challenge—especially for trial lawyers focused on maximizing the recovery from the responsible party. Effective lien resolution must begin before the settlement is reached, so that relevant litigation realities—such as comparative fault, medical causation issues, limited policy limits, and the true value of the care provided—can be incorporated into negotiations with lienholders.

Prescription drug costs are often overlooked but can significantly impact lien values. Part D sponsors are now being encouraged by CMS to pursue these recoveries. As a result, it’s more important than ever to include those drug costs in your special damages calculations and account for them in your lien resolution strategy.

Explore More Resources with Lien Project Network

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.

Need Assistance? Work With The Lien Project, PC

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.

Schedule a Consult today to see how we can help maximize your client’s recovery.