MSPRC Puts Final Demands on Hold

Sometime in early May the MSPRC decided to put a hold on the issuance of any and all Final Demands.  This means you cannot get a Final Demand for your Medicare lien.  Now we have to figure out why and if any actions can be taken.

Haro v. Sebelius

If you didn’t notice in the past 10 days, we at LRS have been pretty excited about a new case out of the United States District Court of Arizona – Haro v. Sebelius.  We have analyzed Haro over and over.  See:

  1. Haro v. Sebelius – No Interest During Waiver/Appeals
  2. Haro v. Sebelius – How it Effects Settlement
  3. Haro v. Sebelius – Medicare Collections

I am speculating when I assume Haro has spooked the MSPRC.  But it is one of the more simple answers to the MSPRC’s stay of execution on Final Demands.  My initial reaction to Haro was “so what!? This just attacks Medicare for bullying language which scares clients.”  It’s entirely possible that the MSPRC realized they can either challenge Haro and create some actual authority on the issue or avoid the possibility of bad-for-Medicare law and take Judge Bury’s decision to heart.  Why risk bad law?  If I’m the MSPRC I change my demand language to include:

  1. Interest will be charged after 60 days unless an appeal or waiver request is initiated by the beneficiary;
  2. Attorneys may distribute funds in accordance with all laws; however, if Medicare’s past payments are not accounted for when a demand because due, the Attorney and/or beneficiary can be charged interest for non-payment.  Attorneys can be charged double damages for failure to pay a lien.

This is basically the law as it stood before Haro with some minor changes.  First, it lets the attorney disburse as much of the settlement as he or she sees fit.  Second, it puts more of the onus on the attorney and would tone down the bullying language.  Is that good enough for Judge Bury?  Maybe.  It’s worth a shot though.

The above seems to be some pretty neutral ground too.  Medicare still will get paid (albeit a bit later); the beneficiary/plaintiff isn’t spooked by the demand letter language; the attorney can take his fee; and the client can have at least some of the settlement proceeds.  I can see where defendants might be a bit weary with this plan – it makes it harder for them to protect Medicare’s interests.  But this is a start.

Liability MSA Procedure in the Western District of New York

This is a topic we have not yet broached on this blog.  On May 6, Assistant US Attorney Robert Trusiak signed the Medicare Secondary Payor Protocol for the Western District of New York.  It institutes a voluntary process for Liability Medicare Set-Asides (LMSAs) in the Western District of New York.  The policy is not an official policy of the Department for Health and Human Services, which oversees Medicare, the MSPRC, and CMS.  Rather, it looks like an attempt to expedite the process where CMS has failed to act swiftly.  There is still no CMS policy for LMSAs.  There are still major questions to the logistics and legality for LMSAs.
Nonetheless, this new protocol fits the time frame as to when the MSPRC put a halt to the issuance of Final Demands.  So it is possible that the two are related.

The big question here is whether the MSPRC would risk lawsuits, injunctions, adjudications of Medicare liens, etc., all for a few more dollars through LMSAs.  Don’t forget that the MSPRC doesn’t review any MSAs.  It is the CMS Regional Offices, which, while run by hardworking, genuinely good people, are severely understaffed (if you disagree that they are good people, review that bolded word back there – they just can’t handle the case load anymore because the system has outgrown itself).

What’s Next for Medicare Liens?

Everyone seems to expect LMSAs – eventually.  But the MSPRC and CMS are not ready.  The simpler answer right now is that Haro has spooked the MSPRC.  They are smart enough to realize copycat litigation will crop up – so they can nip the problem in the bud, make a few minor tweaks to the Final Demand letters, and get back to delaying your cases by more definite periods of time!
We will continue to monitor this important issue and provide updates as they become available. For more immediate updates please follow our Twitter account.  Detailed analysis will be provided to those updates sometime after the initial, tweeted updates.

If you have any questions or feedback please 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.

2 comments on “MSPRC Puts Final Demands on Hold

  1. […] means Haro v. Sebelius is the cause for these changes to the RAR and Final Demand letters.  Conditional Payment Letters […]

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