Malpractice? (Continued from page 10)
recovery and the plaintiff, his attor- ney and the third party payer were or should have been aware of the conditional nature of the payment and they all now need to reimburse Medicare.
What Does The Medicare “Secondary Payer Act” (MSPA) Really Say?
Under Certain Circumstances, Medicare Cannot Pay For Health Care Unless It Is Making A Conditional Payment. History Of The Medicare Secondary Payer Act (Mspa)
Rising Medicare costs eventually led
Congress to enact a series of amendments in 1980 which became known as the MSPA (Medicare Secondary Payer Act). The MSP statute was enacted in 1980.
[Actually, a series of amendments to Medi- care.] Before 1980 if a Medicare beneficiary had an alternate source of pay- ment, such as private insurance or employee group benefit plan, Medicare was the primary payer and the health plan
was a secondary payer, liable only for the claims that remained after Medicare made its payments. Blue Cross and Blue Shield Association v. Sullivan, 794 F. Supp 1166, 1168-69 (D.D.C 1992).
The amendments have been codified at 42. U.S.C. § 1395y (b) (2) and are re- ferred to as the Medicare Secondary Payer (“MSP”) provisions. Congress designed the MSPA to pre-
vent group health plans from providing that a plan will be the secondary payer if Medicare coverage exists. Blue Cross and Blue Shield of Texas Inc. v. Shalala, 995 F.2d 70, 72 (5th Cir. 1993).
The Statute It is important to remember that
Medicare’s right to be reimbursed comes from one small provision in the United States Code. Medicare only has a right to reimbursement out of tort cases when it has made a conditional payment. If the payment is not conditional then there is no right to reimbursement. The Government’s right to repayment comes from this part of the Medicare Sec- ondary Payer Act:
42 USC § 1395(2)(B) Conditional Payment
(i)Repayment required. Any pay- ment under this title with respect to any item or service to which subpara- graph (A) applies shall be conditioned on reimbursement. Thus, the only conditional payments
that Medicare makes are when it pays as a secondary payer. Payments Medicare makes as a primary payer are not subject to reimbursement. Importantly, there is no other provision in the Medicare Act upon which the Government can rely for reimbursement. Thus, the Government’s payment must fit the definition of a sec- ondary payment that is conditional. In order for Medicare to be the sec-
ondary payer there has to be a primary payer. Thus, the first element of the Government’s claim is to prove that there is primary payer – for without a primary payer, there can be no secondary payer.
Who or What is a Primary Payer? 42 USC § 1395y(b)(2)
Primary Payer is defined as: 1. Group health plan or a large group plan;
2. Worker’s compensation law or plan; 3. Auto or liability insurance policy; 4. Self insured plan; 5. No fault plan. Once it is established that there is a
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primary payer, the Government must next establish that Medicare made a conditional payment.
What is a Conditional Payment? As seen above in 42 USC § 1395(2)(B), a conditional payment is one to which “subparagraph A” applies. Sub- paragraph A says that Medicare as secondary payer may not make certain payments unless they are going to be re- imbursed.
42 USC § 1395(2)(A)
In general, payment under 42 USC § 1395 may not be made, except as pro- vided in subparagraph B (i.e. the conditional repayment paragraph, above) with respect to any item or ser- vice to the extent that (ii) Payment has been made or can rea- sonably be expected to be made promptly (as determined in accordance with the regulations) under a workmen’s compensation law or plan of the United States or a State or un- der an automobile or liability insurance policy or plan (including a self insured plan) or under no fault insurance.
12 Trial Reporter Spring 2003
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