Medicare Secondary Payer Myths: The Misconceptions Every Plaintiff Attorney Should Know Part 2

Medicare protects its best interests through the Medicare Secondary Payer (MSP) statute, which mandates that settlement funds are used before Medicare starts paying any bills.

If the government’s interests are not protected, Medicare can place a lien on your client’s settlement funds. Medicare lien resolution is complex, so outsourcing to experts can save time and resources while allowing you to do what you do best.

This is a two-part article that began with Medicare Secondary Payer Myths: The Misconceptions Every Plaintiff Attorney Should Know Part 1.

Myth #4- Medicare Never Actually Enforces its Rights

This myth used to be somewhat true in the past; however, most industry experts agree that Medicare has been monitoring MSA accounts far more over the last few years and will continue to do so.

The federal MSP statute gives Medicare the fundamental right to deny care and remain the secondary payer, and Medicare will make use of this right. Though there are no known litigated cases that have been brought against Medicare for cutting off benefits after discovering misuse of MSA funds, this does not mean that it is not regularly making denials of care.

It is dangerous to assume that Medicare will not monitor a given MSA account. Medicare has been keeping an eye on workers compensation cases and has also indicated that it plans to institute a review process for liability cases. If Medicare finds that its funds have been misused, it will put a lien on your client’s settlement, which will require lien resolution. Outsourcing this task can save time and resources.

Myth #5- Clients Can Obtain Different Insurance After They Settle

Many attorneys assume that their clients do not have to worry about a Medicare set-aside allocation because they can simply switch to a different insurance provider after they settle. This is not the case.

First of all, most insurance carriers include exemptions for care relating to settled claims. That’s not to say your client has no chance of getting another entity to cover their injury, but it comes with risks. When it comes to MSAs, switching to another insurance plan may seem like it can preserve some of the funds, and this could be true in the short term. However, long-term consequences may rear their heads; for example, your client may need to spend MSA funds to cover their new plan’s premiums or deductibles, putting them out of compliance with Medicare guidelines.

Complying with Medicare’s best interests is complex and outsourcing to professionals can save time and resources. If you are in need of Medicare lien resolution services, we can help.

For more information or to schedule a consultation, please submit our contact request form.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.


"Synergy is an invaluable partner in the mediation process. They have extensive expertise in Medicare, Medicaid and Structured Settlements and the ability to explain the impact of these complex concepts to my clients in simple, clear and understandable language. This allows me to focus on obtaining the best possible result in the settlement process."

Michael J. Winer, Esq.
President Florida Workers Advocates (FWA)

"I recently engaged Synergy to assist with a complicated PTD settlement involving a substantial Medicare Set Aside. The claimant’s wife has been providing full time attendant care which is not Medicare covered. The Synergy nurse was able to do a full analysis of non-Medicare covered expenses which far exceeded the value of the MSA analysis performed by the carrier’s contracted MSA provider. The non- Medicare figures became the main focus of the settlement negotiations and more than doubled the value of the case. Although I could estimate the attendant care figures, the nurse added in other items that I would not have routinely considered. I also asked Synergy to evaluate the EC’s MSA as well as their prescription review. Synergy offered insight about the prescription donut hole which I did not have a clear understanding about. Again, their insight and information added a great deal of value to the overall settlement. Not only did I learn from Synergy but was able to educate my clients in the process. These are very complex and complicated areas; I will use Synergy again and again!"

Rosemary Eure
Lancaster & Eure

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