Gucwa v. Lawley: Injured worker and attendant care provider did not demonstrate standing in their complaint to sue under Medicare Secondary Payer Act (“MSP”).

On 4/16/2018, the United States District Court of Appeals for the Sixth Circuit ruled that a workers’ compensation carrier did not have to reimburse an injured worker or attendant care provider for double the amount of payments of medical expenses made by Medicare under the MSP. Gucwa v. Lawley, 2018 U.S. App. Lexis 9428 (4/16/2018, 6th Cir.). The Court ruled the injured worker, and attendant care provider did not demonstrate standing in their complaint to seek reimbursement for from the workers’ compensation carrier under the MSP.

Standing is one among other requirements that must be demonstrated by a plaintiff in Federal Court in order for the Court to have authority over the parties and case. The plaintiff must show that they were in fact injured by the other party. There are a few federal laws that allow a person to sue on behalf of the government where the person suffered no injury at all, called whistleblower laws or qui tam statutes. The MSP is not, however, one of those statutes.

In the circumstances of this claim, Nancy Gucwa provided attendant care treatment to an injured worker, Mark Marusza, related to a workers’ compensation claim and sought payment from the workers’ compensation carrier. The workers’ compensation carrier disputed payments after obtaining favorable independent medical examinations. Medicare paid allegedly $15,665.00 in charges for Mr. Marusza’s treatment costs. The workers’ compensation claim went to trial, and a workers’ compensation judge ruled that claimant’s medical expenses should have been paid for by the workers’ compensation carrier.

After the workers’ compensation decision, Marusza and Gucwa filed an amended complaint in District Court alleging violations under various state and federal laws but also alleged double damages under the MSP for the expenses paid by Medicare. The District Court dismissed the complaint because Marusza or Gucwa did not demonstrate a concrete injury as a result of the carrier’s non-payment.

Marusza and Gucwa appealed the dismissal and provided the District Court with a demonstration of financial injury by stating that Marusza made for co-payments made to Medicare for Gucwa’s treatment in a request for reconsideration. However, because the copayment information was not a part of the original or amended complaint, the District Court continued to uphold its dismissal. Marusza and Gucwa appealed this decision to the Sixth Circuit Court of Appeals.

Although a party may bring a suit on behalf of the federal government under the MSP, the Sixth Circuit Court of Appeals stated in Gucwa that the federal law is not a qui tam statute and the plaintiff must also demonstrate injury. This means that where payments are made by Medicare that may require reimbursement under the MSP, the Sixth Circuit Court held a person suing on behalf of the government must also demonstrate an injury due to Medicare making payments.

The Court of Appeals agreed that the plaintiff did not demonstrate in their complaint that there was a financial or concrete injury suffered by Marusza or Gucwa as a result of Medicare making payments for the attendant care services. Although the plaintiff’s tried to bring in additional allegations of co-payments after dismissal, the Sixth Circuit noted no supporting documentation was provided with the allegation copayments. The Sixth Circuit Court of Appeals was not persuaded the additional allegations warranted an exception to the general law that arguments raised the first time in a motion for reconsideration are untimely and forfeited on appeal.

This case does not speak to the requirements or legal aspects of the MSP. Instead, this case demonstrates a plaintiff’s failure to allege financial injury in a suit under the MSP can lead to a dismissal, which is a universal legal principle.

MSPA Claims 1 LLC choosing new path for recovery under the Private Cause of Action

An interesting opinion was recently issued by the US District Court for the Southern District of Florida in the Claims v. Bayfront Hma Med. Ctr case.(2018 W.S.Dist.LEXIS 44913). The underlying facts of the claim involve a Medicare Advantage Plan enrollee, D. W., who was involved in a  motor vehicle accident on February 1, 2014. The Medicare Advantage Plan was administered by Florida Healthcare Plus ( “FHCP). D.W received medical treatment from a facility operated by the Defendant, Bayfront.  At the time the treatment was provided, D.W. was covered by a no-fault plan, First Acceptance Insurance Company,  and by the FHCP administered Medicare Advantage Plan. Bayfront billed the no-fault plan for $6,255.96 in charges on April 14, 2014. Partial payment was made in the amount of $3,753.58. Bayfront then billed FCHP the same amount, $6,255.96. A separate partial payment of $691.64 was made by FCHP. MSPA Claims, as an assignee of FCHP,  brought this claim on behalf of itself and a similarly situated class of Florida Medicare Part C plans against the provider, Bayfront. Recovery was being sought under the following theories: 1. MSP private cause of action  42 U.S.C. Section 1395 y(b)(3)(A), 2. Florida Deceptive and Unfair Trade Practices Act ( “FDUTPA”) and 3. an unjust enrichment claim.  Defendant moved to dismiss the action arguing that the MSP claim was barred by the statute of limitations and cannot be brought against a provider. The Plaintiff’s standing to bring suit under the remaining two claims was also challenged.

The Court dismissed the claims brought under the  Florida Deceptive and Unfair Trade Practices Act ( “FDUTPA”) and the unjust enrichment theory finding that the Plaintiff’s assignment from FCHP did not include these types of actions. The private cause of action claim, however, was allowed to stand. In reaching this conclusion, the Court found that the plain language of the private cause of action provision was ambiguous. It could be viewed as both allowing a private cause of action against a primary plan as well as a private cause of action against “any entity” who failed to provide “appropriate reimbursement” to the Government or the Medicare Advantage Plan. The Court also gave deference to CMS’ regulations that give Medicare Advantage Plans the same rights to recover from a primary plan, entity or individual that the Government exercises under the MSP regulations. The Court’s assessment of the multiple statutory provisions also supported their conclusion that the Plaintiff may bring a private cause of action for double damages against the provider Bayfront. The Plaintiff, however, will still be required to prove that the payment made to Bayfront was actually a conditional payment under the Medicare Secondary Payor Act. In considering the statute of limitations argument raised by the defense, the Court found that Section 1395y(b)(2)(B)(vi) language does not require that a suit be filed within three years of the date on which the item or service was furnished. This provision instead pertains to the amount of time the Government has to seek reimbursement.

This action represents a departure from the typical claims filed by MSPA Claims against primary insurers, such as automobile or commercial liability insurers,  for reimbursement of conditional payments made to Medicare Part C enrollees by the Part C plans. As the volume and scope of litigation spreads, parties should be proactive in developing a protocol to address claims involving payments by Medicare Advantage Plans.

 

 

Recap of Capitol Bridge LLC’s WCRC Transition Webinar

The new WCRC, Capitol Bridge presented a short transition webinar this afternoon.  The main presenters were Holly Havens of Capitol Bridge and  John Jenkins of CMS. Ms. Havens stressed the group’s 25 years of experience in providing various support services to CMS.  The group intends to maintain the same level of quality and timeliness with processing the files. According to their Statement of Work, development letters, if any, will be sent out within the first 10 business days after receipt of the CMS submission. Determinations will be issued within 20 business days after the complete submission is received.   Files that are currently pending will be transferred over to Capitol Bridge as of March 19, 2018, their first full day. There will be no change to CMS’ projection methodology.

Customer service will be handled by Capitol Bridge’s staff in Pittsford, New York. The preferred method of contact is by telephone, (833) 295-3773 or by email at WCRC@capitolbridgellc.com. All forms of communication must include the claim’s specific case number. Claims should continue to be submitted through the portal and to the same mailing address in Oklahoma. Capitol Bridge’s fax number is (585) 425-5390.

A question and answer session included questions regarding possible liability and no-fault MSA review. John Jenkins declined to address these during this call. Other questions focused on a concern about a backlog given the transition and the qualifications of Capitol Bridge’s reviewers. No backlog was anticipated by Capitol Bridge. Their review staff was also described as experienced MSA nurse reviewers, MSP compliance attorneys, physicians, and pharmacists. Capitol Bridge’s goal is to automate as much of the process as possible to avoid double keying of information and better coordinate the exchange of data between various systems. The portal user interface will not change as a result of the transition.  Capitol  Bridge also indicated that their 20 business day turn-around time should also apply to the amended review process. This presentation will also be available in the near future on CMS’ “What’s New” section on their website.

We will continue to keep you advised of further developments.

CMS Upcoming WCRC Webinar

CMS just announced its plan to host a webinar on March 7th, 2018 at 1:00 pm ET to introduce the new WCRC Contractor. The new contractor, Capitol Bridge LLC,  is expected to assume responsibilities on March 18, 2018. Registration and webinar login URL is https://engage.vevent.com/index.jsp?eid=5779&seid=863 with a conference call number of  877-251-0301, conference ID 9369188.

We will keep you advised of further developments.

Bipartisan Budget Act of 2018: Medicaid Reimbursement Limited

On 2/9/2018, President Donald Trump signed into law the Bipartisan Budget Act of 2018. As a part of the 2018 Act, Section 53102 repeals section 202(b) of the Bipartisan Budget Act of 2013. Section 202(b) was the legislative response to the United States Supreme Court Decision in Arkansas Dept. of Health and Human Services, et. al. v. Ahlborn, 547 U.S. 268 (2006).

Practically speaking, the Supreme Court in Ahlborn ruled that where there is a settlement or judgment of a third party liability claim, federal law limited Medicaid’s recovery to the amount designated as payment of medical expenses. The Bipartisan Budget Act of 2013 altered the federal law the Supreme Court relied on in deciding Ahlborn. By altering the law, Congress provided direction to the Supreme Court and the public that Medicaid could recover up to the amount of settlement or judgment associated with a third party liability claims. The effective date of this change initially was 10/1/2014, but ultimately the change in recovery became effective on 10/1/2017.

The Bipartisan Budget Act of 2018 does away with Section 202(b) of the 2013 Act retroactively as of 9/30/2017 (before the 10/1/2017 effective date). This puts the Supreme Court’s interpretation of the federal law in Ahlborn back in play and may limit Medicaid’s recovery to the amount the settlement or judgment has designated as payment of medical expenses.

As more develops over Medicaid’s reimbursement rights, we will keep you posted.