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What is a Medicare Lien and How Does it Work?

A Medicare lien results when Medicare makes a “conditional payment” for healthcare, even though a liability claim is in process that could eventually result in payment for the same care, as is the case with many asbestos-related illnesses. The conditional payment keeps the Medicare-covered victim from having to pay for care while the liability claim is pending — and it establishes a lien for Medicare to be paid once the claim is settled. Here’s how it works:

  • When a conditional payment is made, a Coordination of Benefits Contractor notifies a recovery contractor to gather information on the conditional payment and work on the case.
  • When the settlement, judgment, award or other payment is finally made, the recovery contractor establishes the final repayment amount for your case and issues a letter requesting payment. This payment amount should reflect a reduction for attorney fees and a portion of the costs.
  • If the liability claim related to your conditional payment ends up being denied, the lien does not take effect and the Medicare payment is applied for covered services like any other Medicare payment. As always, you’ll be responsible for any non-covered services, copayment or deductible.
  • Special circumstances apply to extended latency cases like those involving asbestos (where the disease — and the claims — can surface decades after the exposure at the heart of the liability claim). Since the Medicare Secondary Payer Act was enacted on December 5, 1980, if all of the exposure for which the defendant would be liable occurred prior to that date, there would be no lien and no case for reimbursement. If exposure was alleged or established on or after December 5, 1980 — or a release was signed that includes that date — Medicare could have a potential recovery and lien against the claim.

With more than 35 years of experience as asbestos injury lawyers, we’re ready to help with Medicare liens and all other aspects of your case. If you want to know more, call us.

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