They have held hearings to value the case, and then applied to the total Med- icaid expenditures the same percentage reduction as the settlement is to the total value of the case. Chambers v. Jain, 15 Misc.3d 1120(A), Slip Copy, 2007 WL 1118383 (Table)
N.Y.Sup. (Apr 13, 2007). But cf., D.C. ex rel. A.G. v. City of New York, 18 Misc.3d 1116(A), 856 N.Y.S.2d 497 (Table) (
N.Y.Sup.,2008). Helpfully, the Maryland statute –
unlike the Arkansas statute at issue in Ahlborn – is cast in causative terms limited to liability for medical services provided. It provides for subrogation to a beneficiary’s cause of action against another person “to the extent of any pay- ments made by the Department... that result from the occurrence that gave rise to the cause of action.” Md. Health-Gen., § 15-120(a). Although the words are not identical to the Federal statute, their tenor is the same, and in any event they are constrained by it. The notion that Medicaid’s recovery should be reduced because the plaintiff did not recover the “full value” of the claim applies; while that is not equitable reduction per se, it comes close. The Maryland statute is ambiguous respecting attorney’s fees; it says the Department is not liable, but then says that deducting fees is not to be considered payment of or contribution to those fees.
Estate recovery and payback trusts
While trial lawyers may naturally feel
most concerned about what comes out of a settlement up front – in the form of Medicaid subrogation claims – most clients will be equally concerned about what happens at the back end through Medicaid estate recoveries and special needs trusts. Their trial lawyer should be, too.
Estate Recovery As to the former – estate recovery –
where the injured person has already died so that his estate is the plaintiff, the estate recovery issues loom at least
Fall 2008 Trial Reporter 43
as large as subrogation. Estate recovery issues are of course important where the plaintiff is the estate of an individual who had received Medicaid benefits, or the plaintiff estate pays in whole or part to the estate of someone who had received Medicaid (typically a spouse). Clients may not feel they have gotten much benefit of litigation counsel’s work in set- tling a claim for an estate with little or no subrogation lien only to see most or all of it lost to an estate recovery claim by Med- icaid. Indeed, they haven’t. For a decision correctly recognizing that Ahlborn does not preclude Medicaid’s enforcement of its estate recovery authority, see In re Estate of Ramirez, 14 Misc.3d 480, 826 N.Y.S.2d 553 (
N.Y.Sur., 2006). Congress did not require any estate
recovery until 1993, but both D.C. and Maryland had broad estate recovery programs, to the maximum extent per- mitted under Federal law, from when they were first authorized. In that year, Congress required some estate recovery in all States, but continued or added a number of limitations: — It requires estate recovery for nursing home services, “home and communi-
ty-based services,” and related hospital and drugs services in all States.5 1396p(b)(1)(B)(I).
Id., §
— Other services can also be the subject of recovery, but only if specified in the State’s “Medicaid State Plan.” Id., § 1396p(b)(1)(B)(ii). • D.C. claimed it was entitled to recover for all services provided, but did not update its State Plan until August 4, 2006. It continues to make claims for non-nursing home services provided prior to that date, but when pushed, will drop those claims.6
• Maryland continues to recover 5
“Home and community-based services” refers to services provided under a so- called waiver program for people who required institutional care but could be managed less expensively in their home or in assisted living; related hospital and drug services are those services for institutional- ized individuals.
6
In a suit challenging D.C.’s practices, the Court held that D.C.’s prior practices were illegal, but denied a motion for class certification or prospective relief. Brown v. Pane, D.C. Superior Court, No. ^, decided ^, app pending.
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