Recent Decisions Indicate that Plaintiff Attorneys and Primary Plans Should Take Extra Care to Comply with The Medicare Secondary Payer Act

Enforcement of the Medicare Secondary Payer (MSP) Act has been increasingly in the news lately, with results that are alarming for both primary plans and plaintiff attorneys.

Primary plans beware: Earlier this week, in an decision entitled MSPA Claims v. Tenet out of the U.S. District Court for the Southern District of Florida, the Court dismissed Plaintiff MSPA Claims’ action for a MSP private cause of action for double damages against two medical providers for alleged delay of reimbursement of conditional payments to the MAP. Plaintiff MSPA Claims is an entity affiliated with MSP Recovery LLC, which entities are assigned claims on behalf of  Medicare Advantage Plans (MAPs). Although the Court found that MSPA Claims had standing to bring the litigation, the Court held that the MSP private cause of action for double damages is only available against primary plans. Accordingly, the litigation was dismissed because this action was against medical providers, not primary plans.

Repeatedly in the decision the Court notes that the MSP private cause of action is plain on its face that its intended usage is for actions against primary plans only. What is interesting about this court’s conclusion is that in other recent decisions, the MSP private cause of action has been successfully utilized against plaintiff attorneys as well as medical providers in the past. However, the result of this court’s narrow interpretation of the use of the MSP private cause of action to only primary plans may prompt MAPs to solely target primary plans instead of other entities such as plaintiff attorneys and medical providers. As we always recommend, proactive identification and resolution of MAP conditional payments is recommended, particularly in jurisdictions within the 3rd and 11th Circuits where case law is established for MAPs to have a right to a MSP double damages private cause of action against primary payers that fail to reimburse conditional payments to the MAP.

Plaintiff attorneys beware:  A press release was just issued which indicates that a law firm named Meyer, Rodbell & Rosenbaum, PA has settled with the United States government allegations that it did not appropriately reimburse conditional payments made on behalf of the firm’s clients. Medicare made conditional payments to a client of the firm in and before 2012, who then received a $1.15 million medical malpractice settlement in 2015, according to prosecutors. Medicare then demanded repayment of its initial payments, but the firm refused to pay, the prosecutors said. As a result, the law firm will have to pay the Federal government $250,000 as well as designate a person at the firm trained to be responsible for MSP debts and ensure timely payment every 6 months. Last year, we blogged about a law firm that had almost the same exact circumstances/punishment: Each firm had to (1) designate a person at the firm responsible for paying Medicare secondary payer debts; (2) train the designated employee to ensure that the firm pays these debts on a timely basis; and (3) review any outstanding debts with the designated employee at least every six months to ensure compliance. The only exception is that that Meyers, Rodbell, Rosenbaum, P.A. were responsible for $250,000, while Rosenbaum & Associates (the law firm we blogged about in 2018) were responsible for $28,000. This now being the second law firm that has been sanctioned in this manner should raise alarm bells for plaintiff attorneys to ensure that conditional payments are properly handled and reimbursed.

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