Important Conditional Payment Case Law

Federal Pre-emption

(Parts A&B) Article IV of the US Constitution – Federal law preempts state law

(Part C) 42 CFR 422.422 – Federal Preemption of state law: The standards established under this part supersede any state law or regulation…with respect to the MA plans that are offered by MA organizations


Amendment X of the US Constitution – The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.

Agency Deference

Chevron USA, Inc. v. Natural Resources Defense Council, Inc. Has Congress spoken directly to the precise question at issue?  If the statute is silent or ambiguous with respect to the specific question, is the agency’s answer based on a permissible construction of the statute?

Christensen v. Harris County. Agency deference applies to formal agency documents which carry the weight of law.  Informal agency documents are subject to the test put forth in Skidmore v. Swift & Co.

Administrative Exhaustion

Johnson v. U.S. DHHS. Administrative claims cannot obtain jurisdiction in federal courts until all administrative remedies have been exhausted.  Repurposing as claims sounding in contract do not relieve the action of its exhaustion requirement.

State Law Can Limit the Reach of Medicare’s Reimbursement

CIGA v. Price. CA law limits employers’ exposure to only those treatment costs directly related to worker’s compensation injuries.

Denekas v. Shalala. State wrongful death statute excluding medical cost from claim meant no reimbursement for Medicare.

Medicare Can Seek Reimbursement from Any Recipient of Primary Payment

U.S. v. Harris. Medicare brings reimbursement claim against beneficiary’s attorney.

Humana v. Paris Blank, LLP. MAP brings reimbursement claim against beneficiary’s attorney.

Medicare Not Required to Reduce Reimbursement Over Failure to Be Fully Compensated

Hadden v. U.S. Comparative negligence is not a basis to reduce Medicare’s right to be fully reimbursed.

Medicare as 3rd Party Payee

Wright v. Liberty Mutual. Not allowed when not part of original agreement.

Wilson v. State Farm. Allowed because plaintiff agreed Medicare was owed in the release and defendant had legitimate interest.

Who is a primary payer

Aetna Life Ins. Co. v. Guerrera. MAP can bring private cause of action, but not against attorney or beneficiary.

Humana v. Shrader. Settlement trust can be considered a primary payer

Can a MAP bring a private cause of action? No.

Humana Med Plan, Inc. v. Reale. Only the United States has authority to bring reimbursement action.

Parra v. Pacificare. MAP actions are state court actions.

Phillips v. Kaiser. MAPs are limited to their own contract rate rather than the Medicare reimbursement rate.

Can a MAP bring a private cause of action? Yes.

In re Avandia Mktg., Sales Practices & Prods Liability Litig. MAPs can’t recover via private action under 1395y(b)(3)(A), but it can under 1395y(b)(2)(B)(iii).


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