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Zaleppa v. Seiwell: Medicare Does Not Belong on Settlement Drafts

On Wednesday, November 17, 2010, the Pennsylvania Superior Court (appellate court) made a significant ruling in Medicare lien law in the Zapella v. Seiwell case.  The Court determined that including Medicare on a settlement check is contrary to Pennsylvania law.  The basic reasoning behind this decision is that doing so stands in the way of satisfying a judgment.

As is the case with most landmark Medicare law cases, this decision only has the force of law in once jurisdiction.   But, couple this decision with that in Tomlinson v. Landers and we see a rule beginning to take shape:  Unless Medicare (through CMS, the MSPRC, or the COBC) is a party to your lawsuit, the verdict/award payment cannot include Medicare as a payee.  However, there is one gray area in the Pennsylvania decision.  Are settlements to be treated the same?

That might depend on if the settlement is put on the record, or if it occurs pre-suit.  In either case Plaintiff and Defendant must cooperate to come to a resolution – unless you want court involvement.  That means that you need to know if your plaintiff is a Medicare beneficiary.  You need to know how much of a lien Medicare will claim.  And you need to share that information with each other.

At LRS, we continue to suggest a two check system.  One check to the plaintiff and attorney, the other to Medicare.  Both checks should be delivered to the plaintiff’s attorney for disbursement.  This shows both parties’ necessary actions to protect Medicare interests, while quickly resolving the situation.  This system relies on knowledge of the Medicare lien.

LRS can help resolve all healthcare liens.  Please contact us for more information.

Ryan J. Weiner
Co-Founder Lien Resolution Services
This Blog/Web Site is made available by the publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

About Ryan J. Weiner

Co-Founder of Lien Resolution Services, LLC, a national healthcare lien resolution firm. Our goal is to assist in the fair administration and resolution of healthcare liens on personal injury cases. Please visit our website for more information: www.lienresolutionusa.com.

One comment on “Zaleppa v. Seiwell: Medicare Does Not Belong on Settlement Drafts

  1. […] agreement allows.  If the settlement agreement is silent, you can look to Haro, along with Zapella and Tomlinson (discussed throughout this blog) for more guidance.  Haro is just another in a […]

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