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Detailed Answer: Impact of Medicaid and Medicare on Personal Injury Settlements in Ohio

When you resolve a personal injury claim in Ohio, any medical benefits paid by Medicaid or Medicare for treatment related to your injuries can affect the net amount you actually keep. Both programs serve as payors of last resort under federal law, meaning they cover your care first but retain a right to reimbursement from any third-party recovery.

Medicaid Reimbursement in Ohio

Under Ohio law, the Ohio Department of Medicaid has a statutory subrogation and reimbursement right for any medical assistance paid on your behalf. See Ohio Rev. Code § 5160.31 (codes.ohio.gov/5160.31). When you reach a settlement, the Department can assert a lien on the portion of the settlement attributable to medical expenses. Before you finalize your case, you must:

• Notify the Department of any pending claim that may generate a recovery.
• Provide documentation of your total settlement and evidence of medical expenses.
• Allow the Department to calculate its recovery amount, which may be reduced to account for attorneys’ fees and case expenses under Ohio Admin. Code 5160-1-24 (codes.ohio.gov/5160-1-24).

Medicare Secondary Payer Rules

Medicare’s right to recover paid benefits is governed by federal law. Under 42 U.S.C. § 1395y(b)(2) (law.cornell.edu/42/1395y), Medicare must be reimbursed from any settlement that covers treatment related to your injury. Key points include:

• You must report potential liability, litigation, or settlement to Medicare before completing your settlement.
• Medicare will issue a conditional payment statement detailing the amount to be repaid.
• You or your attorney must resolve the conditional payment—often through negotiation—before releasing settlement funds to avoid future recovery actions by the Centers for Medicare & Medicaid Services (CMS).

Illustrative Hypothetical

Imagine a client, Jane, who is injured in a slip-and-fall. Medicaid covers $20,000 of her medical bills, and Medicare covers $40,000. Jane settles with the at-fault party for $150,000. Before distribution, Ohio Medicaid notifies her attorney of a $20,000 lien under R.C. 5160.31, and Medicare issues a $40,000 conditional payment demand under 42 U.S.C. § 1395y(b). After negotiating a 10% reduction for attorney fees, Jane repays Medicaid $18,000 and Medicare $36,000. She keeps the remaining $96,000.

Helpful Hints

• Inform Medicaid and Medicare of any personal injury claim as early as possible.
• Set aside a portion of your gross recovery to cover anticipated liens.
• Request a final payoff statement from both programs before signing a release.
• Negotiate reductions for attorneys’ fees and case costs where allowed.
• Keep copies of all correspondence, medical bills, and payoff letters.