Legal Question in Insurance Law in Massachusetts

Re: Medicaid Lien

Medicaid is a combination of State and Federal money, and under federal law, they have what is known as a "super lien" on any settlement funds to get reimbursed for any medical expenses they paid on behalf of the injured person. The lien of course only applies to settlements (or recoveries by way of court awards) of claims against the person or persons who caused the injury that required the medical treatment.

When the lien applies, it applies to all parties who have possession of settlement funds--the insurance co. that pays the settlement, the plaintiff's lawyer who distributes it to the plaintiff, and the plaintiff herself.

If the insurance company doesn't make sure the lien gets paid out of the settlement funds it sends you, then Medicaid might very well look to that insurance company to pay it separately, which means the insurance company ends up paying that money twice--once to you, and again to Medicaid. They have the right to make sure they don't double-pay by putting Medicaid on the settlement check and letting you, your lawyer, and Medicaid work out the details of how Medicaid gets its share.

The good news here is that Medicaid greatly reduces the amounts of the medical bills that you incurred, AND pays its share of attorneys fees and collection costs, so, for example, if you incurred $10,000 worth of medical bills, Medicaid might have written that down to about $4,500, and will then reduce their lien by another $1,500 (a typical 1/3 attorneys fee), so you only have to pay them about $3,000.

For a case involving these types of complications, I surely hope you have a qualified lawyer who is capable of answering this question for you. I assume you do and are just looking for a second opinion. If you don't, please call one before settling your case.

Roger Turgeon