From the Listserv Edited by Louise A. Lock
Louise A. Lock is a solo practitioner who received her law degree from the University of Baltimore School of Law. Her practice concen- trates in the areas of medical malpractice, drug products liability and personal injury.
SUBJECT: RE: ERISA HEALTH PLAN SUBROGATION
From: Dennis O’Brien <
Obie26@aol.com>:
I have an ERISA qualified plan with a $45,000 subrogation interest in a case where I have significant contributory neg- ligence to overcome. They are insistent that they be paid in full. This would de- stroy any chance of me settling the case. Is anyone up on the latest in terms of whether they have a right to be reimbursed in full, and whether the lack of an assign- ment may diminish or defeat their rights? I looked at this issue about 4 years ago and the Fed cases were rather dismal.
From: Mitch Lambros <
LambrosJM@aol.com>
Dennis: The case law is still terrible: In United
McGill Corporation v. Stinnett, 950 F. Supp. 124 (D. Md. 1996), Judge Will- iams ruled that despite the applicability of ERISA, fairness and equity required a health plan to reduce its asserted lien by a proportionate share of attorney’s fees and expenses. This decision, however, was overruled by the Fourth Circuit at 154 F. 3rd 168 (1998), and United McGill Cor- poration was given a judgment in its favor for the full amount of its asserted lien. ERISA does not apply, however, if the member is a government employee. If the lien is a real obstacle, I have taken the tact of saying to the lien holder, ok, I’m out, you handle the case, and please be sure to protect my client’s interest when you hire your attorney, etc. They always hate do- ing what we do.
SUBJECT: RE: HMO LIEN IN U.M. CASE
From: Rodney Gaston <
gastonlaw@smart.net>
Has anyone had any success in fight- ing off a HMO lien in a P.I. accident case wherein the U.M. carrier had to pay the claim due to a phantom, unidentified driver causing the accident. Can the HMO carrier still claim a valid subroga-
Fall 2001 Trial Reporter 15
tion interest when the monies received were paid out based upon a contract ac- tion between your client and his own insurance company?
From: Walter Laake <
Wlaake1@aol.com>
Rodney, you first have to obtain the
subrogation/lien language in the client’s health plan or policy. If the plan/policy preserves a right of subrogation against the TORTFEASOR only, they are not en- titled to reimbursement from any U.M. payment, so don’t even volunteer that there has even been a U.M. recovery. If the plan/policy specifically seeks reim- bursement from any U.M. recovery, then you have a problem which I cannot help you solve off the top of my head. Is this provision allowed under the law? Against public policy? OK with the insurance commission
From: “Richard \”Rich\” Walsh” <
r.kwalsh@
erols.com>
I am in a similar battle w/MAMSI on
case where at fault driver died in accident and had no insurance. MAMSI has hired outside counsel to pursue a subrogation lien after I told them to get lost. They are basing their assertions on a memo opin- ion from Federal Judge Chasanow who actually refused in the memo to rule one way or the other on cross motions filed by parties in an ongoing case. I would be interested in whether anyone else has run across this and what approach anyone is taking w/them.
From: “Troy Powers” <
tpowers@abs.net>
I believe it is not permissible for the
very reason you state, contract and not tort. Check the following cases: Geico v.
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