By Annie M. Davidson
The U.S. Department of Justice (“DOJ”) is ringing in the New Year with the Medicare Secondary Payer Act (“MSPA”). On January 8, 2020, the U.S. Attorney’s Office for the State of Pennsylvania announced a $6,604.59 conditional payment settlement with Philadelphia firm Simon & Simon. Once again, the DOJ targeted plaintiff’s counsel using the False Claims Act, which threatens treble damages. Here the monetary value of the settlement is quite low, so it seems the DOJ was not focused on making an example with the settlement value, but more focused on securing agreement from the firm to implement an internal program to ensure ongoing and future compliance with the MSPA. We’ve seen this from the same field office in 2018.
Simon & Simon ultimately agreed to “(1) name a person responsible for paying Medicare secondary payer debts; (2) train the employee to ensure that the firm pays these debts on a timely basis; (3) review any additional outstanding debts to ensure compliance; and (4) provide written certifications of compliance.” In addition, “Simon & Simon acknowledged that any failure to submit timely repayment of Medicare secondary payer debt may result in liability for the wrongful retention of a government overpayment under the False Claims Act.”
As we have mentioned before, standard operating procedure when settling a personal injury claim requires the parties to first determine if a plaintiff is a Medicare beneficiary, and once confirmed it requires compliance with the Medicare Secondary Payer statute by ensuring that Medicare is repaid for any injury-related payments that it made. When that standard operating procedure breaks down, law firms can find themselves in the cross-hairs of the U.S. Department of Justice.
In this case, “[t]he government alleged that at various points between 2014 and 2019, Medicare made conditional payments to healthcare providers to satisfy medical bills of eight of the firm’s clients. Although Medicare demanded that Simon & Simon repay the resulting Medicare debts, the firm allegedly failed to do so.”
The easiest way to inoculate against future enforcement is to prepare proactively and systematically to address Medicare compliance issues at the time of a settlement. Confirm Medicare entitlement prior to settlement. Once identified, investigate whether Medicare alleges related conditional payments. When Medicare alleges conditional payments, all parties share a responsibility to ensure that those payments are properly addressed within the terms of the settlement, and ultimately Medicare is repaid.
Over the last couple of years, the DOJ seems more interested in MSPA enforcement using the False Claims Act. It’s possible the DOJ will keep up this pace as U.S. Attorney McSwain commented: “This settlement agreement should remind personal injury lawyers and others of their obligation to reimburse Medicare when they receive settlement or judgment proceeds for their clients. Lawyers need to set a good example and follow the rules of the road for Medicare reimbursement. If they don’t, we will move aggressively to recover the money for taxpayers.”
ExamWorks Clinical Solutions’ team of conditional payment experts monitors conditional payment enforcement activities like this one. We work closely with our client partners to develop compliance solutions to prevent these types of exposures from materializing. If you need help with conditional payments please contact our Director of Conditional Payment Services, Lou Porrazzo, at 678-256-5085 or firstname.lastname@example.org.
About Annie M. Davidson
Annie M. Davidson is MSP Compliance Counsel for ExamWorks Clinical Solutions. In her role, Annie provides legal analysis to ensure the integrity and quality of ExamWorks' Medicare Secondary Payer (MSP) compliance services and related products. Prior to joining ExamWorks, Annie practiced as an insurance defense attorney in her native Minnesota where she litigated workers’ compensation and liability insurance cases, particularly those involving MSP issues. She is admitted to practice law in the State of Minnesota and the United States District Court for Minnesota, and is a graduate of William Mitchell College of Law. Annie can be reached at Annie.Davidson@examworks-cs.com or at 651-262-9618.