On June 18, 2018, a Philadelphia personal injury law firm, Rosenbaum and its Associates, and its principal entered into a settlement agreement with the United States to resolve allegations that they failed to reimburse the United States for certain Medicare payments the government had previously made to medical providers on behalf of firm clients who sought medical care.
The
government’s investigation arose under the Medicare Secondary Payer provisions
of the Social Security Act, which authorizes Medicare, as a secondary payer, to
make conditional payments for medical items or services under certain
circumstances. When an injured person receives a settlement or judgment,
Medicare regulations require entities who receive the settlement or judgment
proceeds, such as the injured person’s attorney, to repay Medicare within 60
days for its conditional payments. If Medicare does not receive timely
repayment, these same regulations permit the government to recover the
conditional payments from the injured person’s attorney and others who received
the settlement or judgment proceeds.
At
various points before March 2017, Medicare alleged it made conditional payments to
healthcare providers to satisfy medical bills of nine of the firm’s clients, at
least one of whom had declared bankruptcy. Between May 2011 and March 2017,
Medicare demanded repayment of the Medicare debts incurred from those
conditional payments.
Under
the terms of the settlement agreement, Rosenbaum agreed to pay a lump sum of
$28,000. Rosenbaum also agreed to (1) designate a person at the firm
responsible for paying Medicare secondary payer debts; (2) train the designated
employee to ensure that the firm pays these debts on a timely basis; and (3) review
any outstanding debts with the designated employee at least every six months to
ensure compliance. In addition, Rosenbaum acknowledged that any failure to
submit timely repayment of Medicare secondary payer debt may result in
liability for the wrongful retention of a government overpayment under the
False Claims Act.
This
settlement agreement should remind personal injury lawyers and others of their
obligation to reimburse Medicare for conditional payments after receiving
settlement or judgment proceeds for their clients.
