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Haro v. Sebelius – Medicare Collections

In early May, Judge David C. Bury of the United States District Court of Arizona wrote the opinion for a major Medicare collections case, Haro v. Sebelius.  Like much of the MSP Compliance profession, we have reviewed that case over the past few postings.  Today’s posting is a short recap.  First, Judge Bury’s holding:

IT IS FURTHER ORDERED that the class is certified and defined as follows: ‘persons who are or will be subject to MSP recovery, and from whom defendant has demanded or will demand payment of MSP claims before there have been determinations of the correct amounts through the waiver or appeal process.’


“IT IS FURTHER ORDERED that Defendant’s demand for payment of her MSP reimbursement claims, under threat of collection actions before there has been a resolution of an appeal regarding the amount of the Defendant’s MSP claim or a waiver request, exceeds her authority under the Medicare statute, and Defendant is enjoined from demanding payment of a MSP reimbursement claim with threats of commencing collection actions before there is a resolution of an appeal or waiver request.

“IT IS FURTHER ORDERED that the Defendant’s demand that attorneys withhold liability proceeds from clients pending payment of amounts claimed by the Defendant as MSP reimbursement exceeds her authority under the Medicare statute, and Defendant is enjoined from demanding that attorneys withhold liability proceeds from their clients pending payment of disputed MSP reimbursement claims.

On Monday, we noted that collection activities are precluded against beneficiaries pending resolution of waiver requests or appeals on the Medicare lien.  And on Tuesday, we discussed Haro‘s effect on settlement and payment of settlement.

Today we want to show how strongly Judge Bury’s worded the opinion.  Judge Bury wrote that CMS’s 60-day time frame to collect on Medicare liens is “neither rational nor consistent with the statutory scheme providing for waiver and appeal rights.”  This language is not a good starting point for a decision that Medicare (and it’s agents) will almost certainly appeal.

At LRS, we often assist with Medicare lien appeals, compromises, and waivers where payment was necessary prior to a response by Medicare.  We often questioned why Medicare could profit off of bank-interest while plaintiffs waited for appeal responses.  Little could be done to rectify those situations, until Haro.  While Haro is not necessarily binding on your cases, it does give hope that if you knowingly fail to pay a Medicare lien during those appeal processes, you will not be charged interest.  This change is important as it will allow you to skip the 10-14 week refund process (if your appeal is successful).  This gets your client the settlement funds as much as four months sooner and makes you a hero to your client once again.

If you need assistance with Medicare liens, Medicaid liens, ERISA liens, or any other healthcare liens, contact LRS.

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.

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