Last week a Medicare Secondary Payer (MSP) case out of the 11th Circuit Court was issued (MSPA Claims 1, LLC v. Scottsdale Ins. Co., No. 18-21525-CIV-MORE, 2018 U.S. Dist. LEXIS 218675 (S.D. Fla. Dec. 12, 2018).  The facts of the case essentially mirror recent other cases that we have seen:

  • Plaintiff, MSPA Claims 1, LLC (Plaintiff), filed suit under the Medicare Secondary Payer Act (MSPA) claiming a private cause of action, against a primary payer;
  • Plaintiff also claimed to be the assignee of numerous Medicare Advantage Organizations, Medicare Service Organizations, and Independent Physician Associations;
  • Two assignors were identified by Plaintiff, in this matter, which allegedly provided Plaintiffs with the ability to bring suit under the MSPA; and
  • Plaintiff brought suit to recover payments, as an assignee against Defendant, Scottsdale Insurance Company, the primary insurance plan, for accident-related expenses.

As a brief reminder, the MSPA sets forth three elements necessary for a private cause of action:

  1. the defendant’s status as a primary plan;
  2. defendant’s failure to provide for primary payment, or appropriate or timely reimbursement for payments made when a primary payer exists; and
  3. damages.

The main question that is addressed in these MSP cases is who can sue under the private cause action provision of the MSPA.  We have certainly seen jurisdictions interpret the MSPA quite differently.  In fact, in the Eleventh Circuit, we have seen the private right of action provision extended from a Medicare beneficiary to Medicare Advantage Organizations (MAOs), which is one of the reasons we continue to see these lawsuits pop up so frequently in this Circuit.

In this case, as we have seen in other recent cases, the Plaintiff was unable to establish standing.  Standing would have required the demonstration of a valid assignment to the Plaintiff for recovery rights from a Medicare beneficiary, an MAO, or a direct provider of medical services.  Because of the lack of standing, this case was dismissed.  However, we should not forget that this Plaintiff has initiated class action litigation nationwide on the pretense of being the assignee of MAOs, and on allegations that primary payers have failed to reimburse payments made by the Medicare Advantage Plans, to which Plaintiff is allegedly an assignee.

We speculate that we will continue to see these types of claims championed across the nation, and that it is just a matter of time until the Plaintiff finally masters establishing standing, which has been the fatal flaw in most cases. Once Plaintiff is able to demonstrate standing in these cases, the claims will proceed.  With this concern at the forefront of our minds, we would continue to suggest the following pro-active best practices to ensure that primary payers get ahead of any such litigious actions by:

  • Asking questions of beneficiaries, to determine if in fact they have supplemental plans;
  • Asking to see beneficiary’s Medicare cards;
  • Understanding the differences between CMS and MAOs and that these entities do not operate in the same fashion, particularly with Medicare Advantage “trial rights” and open enrollment periods;
  • Not assuming that medical treatment has terminated because bills have not been received;
  • Asking whether beneficiaries are still treating; and
  • Responding to all correspondence from MAOs, timely and promptly.

In the meantime, we will be sure to keep our readers updated on any further MSP litigation that may impact your claims.