Q&A: Do Medicare Advantage Plans Pay Attorney Fees?

October 3, 2017

They should, but that doesn't mean they will always start with that position.

 

In order to walk plan reps through an explanation as to why the plans must apply a pro rata share reduction of their reimbursement interest (pay attorney fees), start with Federal Codes.  Begin with 42 CFR 411.24(i)(3), then go to 42 CFR 433.37(c).

 

The case I would suggest you look at is one I really hate because the court got a lot of the law wrong regarding the Medicare Advantage plan.  One thing the court did get sort of right was the fact that the plaintiff could not get a pro rata share reduction of fees if the plan had to sue the plan member to get paid.  The court held as follows:

 

“Even if Western retains the right to dispute the amount, its argument regarding Ms. Reale's procurement costs lacks merit. A beneficiary's procurement costs do not offset an MAO's recovery if the MAO must litigate to secure repayment. See 42 C.F.R. §§ 411.37(e), 422.108(f). This is the third lawsuit in which Humana has attempted to recover its $19,155.41 secondary payment. Therefore, Humana may recover the full amount.”

 

HUMANA MEDICAL PLAN, INC., v. WESTERN HERITAGE INSURANCE COMPANY, 832 F.3d 1229 at 1240. (2016 United States Court of Appeals, Eleventh Circuit.)

 

So, it kind of proves your point from the opposite direction, as the court recognizes the right to reduce under the code, and then cites to another part of the code that voids that right if the plan has to sue to recover its conditional payments.  How can the right be voided if it didn’t exist in the first place?

 

I’ll see if I can find a better case that proves it in the affirmative, but for now, try that.

 

Steve

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October 3, 2017

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