Disclaimer: This article provides general information and does not constitute legal advice.
Detailed Answer
After a personal injury in Vermont, Medicaid and Medicare act as secondary payers. They cover your medical expenses first but reserve the right to recover payments from any third-party settlement.
Medicaid Liens in Vermont
Under Vermont law, the State may recover medical assistance payments from third-party recoveries. See 33 V.S.A. § 1953. When you file a personal injury claim, notify the Vermont Division of Rate Setting. The division issues a lien detailing the amount it paid on your behalf. You must satisfy that lien—often from settlement proceeds—before you disburse funds.
Medicare Conditional Payments
Federal law under the Medicare Secondary Payer Act at 42 U.S.C. § 1395y(b) (see CMS Medicare Secondary Payer) lets Medicare make conditional payments when a third party is at fault. After you settle, Medicare demands repayment for any conditional payments it made. Your attorney must request a conditional payment report, confirm the final amount, and pay that from your settlement.
Impact on Settlement Offers
When you draft a settlement demand, factor in estimated Medicaid and Medicare liens. Subtract those liens from your gross settlement to calculate your net recovery. Attorneys typically place funds in escrow until payers confirm final liens. You then disburse funds to satisfy liens, cover attorney fees, and deliver your net award.
Helpful Hints
- Notify Medicaid and Medicare early in your claim.
- Request a formal Medicaid lien letter and a Medicare conditional payment report.
- Review lien amounts for accuracy and challenge any errors.
- Negotiate lien reductions when permissible under law.
- Allocate your settlement clearly: medical bills, liens, attorney fees, and your net recovery.
- Use an escrow or trust account to hold funds until liens resolve.
- Confirm final lien satisfaction before distributing settlement proceeds.
- Work with an attorney experienced in Medicaid and Medicare subrogation.