Synergy Blog

From Roger Baron: Part C provider NOT granted federal right of subrogation by Medicare laws

Reprinted with permission from Roger Baron

In Konig v. Yeshiva Imrei Chaim Viznitz of Boro Park, Inc., et al, 12-CV-467 (E.D.N.Y. 3/30/12), we find a situation where Rawlings and Oxford Health Plans (Oxford) were brought into a NY state court action through an “order to show cause” proceeding for the purpose of extinguishing a lien assertion of $24,000 for medical bills paid to an insured for injuries related to a landowner liability tort claim.  These bills were paid pursuant to a “Medicare Advantage Policy” sold by a private insurer as an alternative to Medicare insurance provided by the Government.  Rawlings and Oxford removed the case to federal court. This decision remands the matter back to state court.  This Court rejects the argument that a private insurer selling a Medicare alternative is granted a preemptive federal right of subrogation by the federal Medicare laws.  This Court observes that such an interpretation (as urged by Rawlings and Oxford) has been, “rejected by many courts” and further states, “I agree and conclude that the Medicare laws offer no private right of action – express or implied – to [the private insurers] to enforce any claimed subrogation rights.”  This opinion also points out, in footnote 1, that Rawlings, as a recipient of an order to show cause, is unlikely to “be properly considered a ‘defendant’ in a ‘civil action’ for purposes of removal.”

To view the decision click HERE

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