Detailed Answer
Disclaimer: This article is for educational purposes only and does not constitute legal advice. Always consult a qualified attorney for advice about your specific situation.
In Maryland, if you receive Medicaid benefits and later recover money through a personal injury settlement, the Maryland Medicaid Administration has a statutory right to reimbursement. Under Maryland Health-General §15-107, Medicaid places a lien on any judgment or settlement that arises from an injury for which it paid medical assistance. You must understand how the lien works, how to calculate the amount owed, and how to satisfy or negotiate it before disbursing funds.
1. Identify and Verify the Lien
Maryland law grants Medicaid a lien on any monetary recovery related to medical services it paid. To identify the lien:
- Request a written payoff demand from the Medicaid Administration.
- Verify the period during which Medicaid provided benefits tied to your injury.
- Obtain an itemized statement showing all amounts Medicaid paid on your behalf.
For full statutory language, see Health-General §15-107.
2. Calculate the Reimbursement Amount
To compute the lien amount:
- Use the Medicaid payoff demand letter to confirm the total paid.
- Allocate costs to the specific injury, excluding unrelated services.
- Factor in any co-payments or deductibles you paid personally.
3. File Notice and Perfect the Lien
Although Medicaid’s statutory lien attaches automatically, you must perfect it by filing a certified notice with the clerk of the circuit court in the county where the injury occurred. This step ensures the lien is enforceable against settlement proceeds.
4. Negotiate or Seek Waiver
Maryland may reduce the lien amount in certain circumstances:
- Hardship Waiver: Demonstrate that paying the full lien would create financial hardship.
- Common Fund Doctrine: Allocate a portion of attorneys’ fees and costs to reduce Medicaid’s share proportionately.
Submit your request in writing to the Medicaid Administration and include supporting financial documentation.
5. Disburse Settlement Funds Properly
Your attorney should draft a settlement order that sets aside the Medicaid payoff amount. Disbursing funds without satisfying the lien exposes you and your attorney to potential liability for reimbursement plus interest.
Helpful Hints
- Request the Medicaid payoff demand early in your case to avoid delays at settlement.
- Keep clear records of all medical bills, correspondence, and settlement documents.
- Negotiate with Medicaid for a percentage reduction, especially if your recovery is limited.
- Coordinate with any other lienholders, such as Medicare or private insurers, to avoid overlapping claims.
- Ensure your attorney obtains a court order authorizing payment of the lien to protect your net recovery.