The Department of Justice Increases Pursuit of Personal Injury Firms for Medicare Reimbursements
The Department of Justice’s current pursuit of investigations into personal injury law firms is viewed as an effort to crackdown on outstanding liens for Medicare reimbursements. The main aspect of this particular pursuit involves the firms’ Medicare secondary payer requirements. According to the US Centers for Medicare and Medicaid reimbursements, secondary payer is the term generally used when the Medicare program does not have primary payment responsibility – that is, when another entity has the responsibility for paying prior to Medicare.
Over the past 18 months, the U.S. attorneys’ offices — primarily throughout East Coast locations — have announced several settlements with plaintiffs law firms. The DOJ alleges said firms failed to fully reimburse their clients for their respective Medicare debts.
In the personal injury law arena, plaintiffs attorneys tend to consider Medicare liens inconvenient (often regarded as general headaches), as they are frequently difficult to monitor and analyze fully and accurately. Thus, said liens often force personal injury lawyers into a difficult situation where they must negotiate their settlements blindly, without being able to accurately confirm what percentage of the lien will need to be paid back, and what percentage might be forgiven.
With their current pursuit of countless personal injury firms, the feds are increasing that difficulty and effectively pressuring personal injury lawyers into the realization that there will be consequences if their clients’ Medicare liens aren’t properly and timely reimbursed.
The latest instance of the DOJ targeting a firm came on behalf of William McSwain, the U.S. Attorney for the Eastern District of Pennsylvania. McSwain announced that Philadelphia-based personal injury firm, Simon & Simon, known for their specialization in limited tort auto litigation, was forced to pay $6,600 to settle claims related to a failure to properly reimburse Medicare liens for eight of the firm’s clients. Similar action by the Eastern District was announced in 2018 against the personal injury firm, Rosenbaum & Associates, also based in Philadelphia. That action settled for approximately $28,000.
Additionally, firms outside Pennsylvania have faced much larger settlements.
In November, a settlement totaling more than $91,000 was announced by the U.S. Attorney for the District of Maryland against the Saiontz & Kirk firm located in Baltimore. Moreover, in March 2019 the office announced a quarter-million dollar settlement with the Meyers, Rodbell & Rosenbaum firm of Gaithersburg, Maryland.
The Department of Justice is viewed as having a primary objective to crack down on such outstanding Medicare liens owed by personal injury firms, and all indications are that similar pursuits will continue and expand, affecting firms across the country.
Whether or not the crackdown on outstanding liens is correlated to the recent massive fraud investigations and arrests that have made headlines isn’t entirely clear. However, it is worth noting that the DOJ successfully exposed some of the largest cases of Medicare fraud in U.S. history last year.
In April, authorities arrested 24 individuals for their involvement in a $1.2 billion Medicare fraud scheme. At the time it was regarded as one of the largest health care fraud schemes to be prosecuted in U.S. history. AARP reported that the defendants were scattered across the U.S., and included “three medical professionals, officials from five telemedicine companies, and the owners of dozens of durable medical equipment companies.” AARP described the scheme as involving “paying doctors to prescribe medical braces from the aforementioned companies with little or no interaction — sometimes only a brief phone call — with patients.”
In September, the feds announced arrests in another extensive fraud scheme, this one involving 30 individuals that was estimated to have cost taxpayers over $2 billion.
According to the Department of Justice’s report, the scheme entailed convincing victims to participate in genetic tests to determine their risk factors for various diseases, including screenings for cancer. Legitimate cancer screenings are rarely tested through genetic means.
The Associated Press reported that the scheme provided participants engaging in the fraud with the ability to “acquire patients’ Medicare IDs and use them for future illicit purposes.” Prosecutors alleged that multiple entities and labs were involved in the extensive and monumental scheme. Medicare reportedly paid out hundreds of millions of dollars for unnecessary medical tests before the fraud was identified.
Whether the fraud crackdowns and the pursuits into the secondary payment liens of personal injury firms are two aspects in an overall objective by the DOJ is up for interpretation. However, one thing seems to be clear: the headaches involved for personal injury attorneys navigating their Medicare liens has likely only just begun.