Utah Recognizes a New Cause of Action for Negligent Credentialing of a Health Care Provider
Posted by: Zack Peterson
March 01, 2011

In Archuleta v. Halverson, 2010 UT 36, the Utah Supreme Court, in a 3-2 decision, reversed and held that Utah now follows the majority of jurisdictions and recognizes a cause of action for negligent credentialing.  The primary basis for recognizing this new cause of action was Justice Durham's determination that the immunity contemplated by the peer review statute only operated between the doctor whose credentials are under review, the suppliers of information, and the decision makers.  Justice Durham determined that the peer review statute did not contemplate immunity between a patient and a hospital.  The Court concluded that "the [peer review] statute was never intended to shield hospitals from potential liability or to provide hospitals protection from medical malpractice claims."

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Medicare, Medicaid, SCHIP Extension Act
Posted by: Tanya Lewis
November 05, 2010

Medicare, Medicaid, SCHIP Extension Act: An Introduction by Tanya Lewis

Originally published in COMMUNIQUE, the official journal of the Clark County Bar Association (CCBA). April 2010, Vol. 31, No. 4.

In 2007, Congress passed the Medicare, Medicaid, and SCHIP Extension Act, known by its acronym, MMSEA. The purpose of the MMSEA is to protect Medicare as a secondary payer in personal injury matters where the plaintiff is a Medicare beneficiary, and ultimately, to increase the recovery to Medicare of amounts paid for medical treatment provided to recipients if another entity or party can be held responsible. This article provides some basics about the Medicare program, the reasons for implementation of MMSEA, its requirements, and ways that litigation attorneys can assist their clients in complying with the new requirements, which go into effect on January 1, 2011.

Medicare basics

Medicare was instituted in 1965 as a way to provide medical care to those receiving social security benefits, particularly to those over the age of 65. Since then, the program has been expanded to include other groups. Currently, those eligible for Medicare are people over age 65, people with endstage renal disease, and persons who have received Social Security Disability for more than 24 months, including those who have been diagnosed with ALS (Lou Gehrig's disease). As of 2009, Medicare provided health insurance coverage to 45 million people, 38 million of whom were over age 65, and another 7 million who qualified for Medicare because they suffer from a permanent disability. Kaiser Family Foundation, January 2009.                            

As the U.S. population continues to age, it is anticipated that Medicare expenditures, as a percentage of the federal budget, will rise. In 2009, Medicare expenditures comprised 13 percent of the national budget, and 19 percent of the nation's annual health expenditures. Medicare spending is expected to nearly double in the next decade. In 2009, Medicare expenditures totaled $477 billion. However, in 2018, the projected expenditures are $871 billion. The projected increases can be attributed not only to an anticipated growth in enrollment, but also to the expectation that, despite anticipated reforms, health care costs will continue to rise. Kaiser Family Foundation, January 2009.

Why MMSEA

In 2009, the Social Security and Medicare Trustees Reports showed that the combined unfunded liability of those two programs had reached $107 trillion in 2009 dollars. "Unfunded liability" means the difference between the benefits that have been promised to current and future recipients and what will be collected in dedicated taxes and Medicare premiums. National Center for Policy Analysis (NCPA), June 2009. The NCPA went on to point out that, "[i]f no other reform is enacted, this funding gap can only be closed in future years by substantial tax increases, large benefits, or both."

It is clear that without some type of additional funding, the Medicare program as it currently exists cannot continue. MMSEA positions Medicare in a manner to recoup not only costs for treatment paid to recipients when another party can be held responsible, but also to recoup fees and penalties from responsible parties who do not report information about claims as required by the law, or who fail to reimburse a Medicare lien established in a personal injury case, as discussed in further detail below.

Complying with MMSEA

Who is required to report?

Basically, any entity that pays injury claims on a regular basis has responsibility to report information about claimants who are Medicare beneficiaries. These entities include liability insurers, corporations who are self-insured, group health plans, and workers compensation carriers and payees. These entities, known as responsible reporting entities (RREs) under the new legislation, are required to determine whether a plaintiff is a Medicare beneficiary. If so, they must report data pertaining to the claimant's (or plaintiff's, if litigation is filed) claims and the settlement or other resolution of the case to the Centers for Medicare Services (CMS). CMS was established by the U.S. Department of Human and Health Services to administer the Medicare program. It is important to note that the responsibility to report to CMS is conferred upon the RRE by statute, and cannot be passed off or delegated to claimants, attorneys, or medical treatment providers.

What must be reported?

The reporting guidelines suggest that data elements to be reported should include the injured party, the claimant's name (if different from the injured party), the policy information, or, if the entity is self insured, the claim or other tracking number, the incident information, the status of the claim or case, and the claimant's attorney's information. The information that RREs are required to report is subject to change upon directives from CMS.

How to report?

The RRE is required to designate both an "authorized agent," who registers the company with the CMS Coordination of Benefits Contractor (COBC), and an "account manager." Once registered, the RRE will be prescribed quarterly time periods, meaning that the RRE will report four times per year.

The reporting process is completed electronically, and will take place between the RRE and the COBC. The COBC is tasked with managing the reporting process, and will provide support to RREs in the form of software and technical assistance.

Penalties for non-compliance with MMSEA

The reporting period was initially scheduled to start on January 1, 2010. However, this deadline has been postponed to January 1, 2011. After January 1, 2011, all required entities must report as directed. The penalties for non-compliance are steep-up to a $1,000 per day, per claim fine. There is no safe harbor or minimum threshold amount to preclude the assessment of penalties.

Best practices guide for litigation and claims handling

It is imperative that attorneys consult with clients who will be deemed to be RREs and counsel them on both the duties to report under MMSEA and the penalties for failing to do so. For attorneys who work for insurance companies, group health plans, or self-insureds, a simple one- or two- page letter advising clients on the existence of the new regulations can be an excellent tool to provide basic information about the legislation, as well as a marketing opportunity inviting the client to contact the attorney to learn more. Plaintiffs' attorneys will also want to be aware of the new reporting requirements.

For attorneys litigating personal injury cases, it is important to conduct written discovery and depositions in a way that any information about treatment paid for by Medicare is ferreted out well in advance of a case's settlement or trial. We recommend serving a standard discovery request that asks if a plaintiff or plaintiff's dependent has ever been a Medicare recipient or applied for Medicare benefits. A request for production of the plaintiff's Medicare benefits card or Explanation of Benefits statements might also be prudent.

Concluding the case

It will also be increasingly important to identify lien amounts with information directly from Medicare prior to settlement of the case or trial. A frequent complaint of both plaintiff and defense attorneys is slow response times from CMS in response to requests for information. Unfortunately, with the implementation of MMSEA, the response times are likely to increase. It is prudent to follow up all calls with CMS in writing, and begin the process of obtaining lien amounts 90 days prior to mediation or trial.

In a mediation or arbitration setting, best practices may dictate advising the mediator or arbitrator of the Medicare lien when he or she is retained, and include the most current information possible about the lien in the mediation or arbitration brief. MMSEA is expected to also impact awards for future damages, so more investigation into this issue on the part of both plaintiff and defense counsel is warranted.

More information is available on the Web from the U.S. Department of Health and Human Services and CMS at www.section111.cms.hhs.gov.

Tanya N. Lewis is an associate in the Salt Lake City, Utah firm of Richards Brandt Miller Nelson, and was an associate at the Las Vegas firm of Hutchison & Steffen from 2004 to 2009. Tanya is a 1996 graduate of the University of Washington and a 1999 graduate of the Seattle University School of Law. She practices primarily in the fields of insurance defense and commercial litigation and can be reached at tanya-lewis@rbmn.com.

Medicaid, SCHIP

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