I am 65 years old and suffered catastrophic personal injuries in a Lake County, Waukegan, IL automobile accident. The insurance company involved is telling me that any settlement of my claim will need to involve setting aside funds for Medicare. What does this mean? Is Medicare going to take my entire settlement?
Medicare is considered a secondary payor on personal injury cases. This means that when someone 65 years of age or older gets into a motor vehicle collision or sustains injuries do to the fault of another, Medicare is considered secondary health insurance. The at-fault individual’s liability insurance is considered primary.
Despite this, Medicare will still (almost always) pay medical expenses associated with your injury claim. The caveat here is that Medicare expects to be paid back if and when you recover on your injury case. A big part of what we do as injury attorneys is negotiate with Medicare to bring the amount they will accept down. This nets you more compensation from any settlement or judgment you obtain.
One issue that has arisen in dealing with Medicare in the context of injury claims is that of a “Medicare Set-Aside” (or MSA). In worker’s compensation cases, it is required that when a Medicare beneficiary obtains a settlement in excess of a certain dollar value, they are required to consider Medicare’s interests in potentially paying for that injured individual’s future medical expenses associated with their work accident. The thinking behind this is that if Medicare has to pay money for future medical expenses, a certain portion of the worker’s compensation settlement should be “set-aside” to reimburse Medicare for these future expenses (because, as you recall, Medicare is considered a secondary payor).
However, third-party liability cases such as automobile collisions, trucking accidents, and traumatic brain injuries caused by another party, are different than worker’s compensation cases. Specifically, there is no federal or state law requiring that funds be “set-aside” to reimburse Medicare for future medical expenses on these types of cases. The rationale behind this is beyond the scope of this blog post, but what’s important is that you know you are not required to create an MSA on your injury case. This is true even if you sustained catastrophic, permanent injuries that will require life-long treatment.
The net effect of not having to create a MSA is that you actually get the proceeds of your injury settlement, rather than having the proceeds sit in an account where you cannot access them.
Beware, however, insurance companies may try to negotiate your injury settlement by requiring that you create a MSA as a condition of your settlement. If you agree to this, then you have contractually obligated yourself to create a MSA, and there is nothing that can be done to reverse this. Do not fall into this contractual trap.
Being aware of Medicare law is vital to successfully resolving your Chicago, Waukegan, and Lake County injury claim. It is also vital in making sure that you actually receive compensation from your claim!
Contact Ryan, Ryan & Viglione today to discuss how Medicare, Medicaid, and/or health insurance may factor into your accident case. Integrity, Compassion, Results (and no set-asides).
