771 F. Supp. 2d 68
D.D.C.2011Background
- Plaintiff, survivor and administrator of his mother's estate, settled a Pennsylvania wrongful death action for $90,000 (80% wrongful death, 20% survival).
- Medicare paid the mother's medical costs totaling $40,213.74 during hospitalization; CMS sought reimbursement under the Medicare Secondary Payer (MSP) provisions.
- CMS notified plaintiff in November 2007 of a required reimbursement amount of $25,868.58 after deducting CMS's procurement costs; plaintiff paid under protest and appealed.
- The settlement release covered all liens, including medical liens, and the Pennsylvania court approved the settlement in May 2007 with funds held in escrow for CMS's lien disposition.
- Plaintiff argued MSP allows reimbursement only from the decedent's estate and perhaps only for medical costs related to the fall; CMS argued full medical costs from the settlement are recoverable under MSP.
- Court denied plaintiff's motion for summary judgment and granted CMS's cross-motion, holding MSP permits reimbursement from the wrongful death settlement and that due process was not violated.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| MSP entitlement to reimbursement from settlement proceeds | CMS may recover only from the decedent's estate, not the wrongful death settlement. | MSP allows reimbursement from settlement proceeds for medical costs incurred. | CMS may recover from the wrongful death settlement proceeds. |
| Due process in post-deprivation collection | Plaintiff was deprived of settlement funds without due process. | Plaintiff had adequate process and no protected property interest in the medical-cost portion. | No due process violation; procedures were adequate. |
| ALJ continuance denial and due process | Denial of continuance prejudiced plaintiff's ability to prepare. | No substantial prejudice; de novo review cured potential issues. | No due process violation from continuance denial. |
Key Cases Cited
- Cox v. Shalala, 112 F.3d 151 (4th Cir. 1997) (MSP recovery from wrongful death settlements supported when medical costs are included in settlement)
- Bradley v. Sebelius, 621 F.3d 1330 (11th Cir. 2010) (MSP recovery from estate; non-medical tort claims not subject to MSP)
- Brown v. Thompson, 374 F.3d 253 (4th Cir. 2004) (CMS entitled to reimbursement from settlement proceeds under MSP)