MSP Recovery On WSVN-Fox News

Lawyers: 11th Circuit Medicare Ruling Could Be Worth Billions

by Katheryn Hayes Tucker

A federal appeals court decision analyzing the Medicare Secondary Payer Act could put the nation’s largest automobile insur­ance companies and other providers on the hook to pay billions of dollars in Medicare reimbursement.

“This is a humongous victory,” said John Ruiz of Miami, attomey for MSP Recovery, which be said owns billions of dollars in claims as­signed by health maintenance organiza­tions offe1ing Medicare Advantage Plan benefits. Ruiz said he and his partner Frank Carlos Quesada, have about 30 Florida lawyers working in-house on MSP Recovery cases and additional at­torneys around the country for similar actions seeking to recover from insui? ance companies.

The U.S. Coutt of Appeals for the Eleventh Circuit ruled in MSP’s favor Aug. 30 in seven consolidated cases under the Medicare Secondary Payer Act of 1980, which requires p1imary insUl’ance plans to reimburse Medicare for medi­cal bills that the primary plans have or had a re.sponsibility to pay for. The Jaw creates a cause of action for the United State.5 to seek double damages from a p1imary plan that shirks responsibility.

MSP Recovery acts as a collection agency, stepping into the Medicare pro­vider’s shoes and pui’SUing payment on contingency with an agreement to split any recovery, after deducting expenses.

Each case before the Eleventh Circuit involved an automobile wreck for which a health insurer paid for medical services that MSP contends should have been covered by a no-fault personal injury protection insurance policy. The de­fendants include Allstate. Progressive, IDS Property Casualty and Infinity Auto Insurance Co.

Judge R. Lanier Anderson distilled the cases down to one central question: Can an insurer’s contractual obliga­tion trigger the private cause of action provision in the law, absent a court judgment as­signing liability? “We hold that it can.” Anderson wrote, with the agreement of Chief Judge Ed Carnes and U. S. District Judge Roger Titus of Maryland sitting by designa­tion.

Lead counsel for Allstate in these actions, Rachel LaMontagne of Shutts & Bowen in Miami, said, “The opinion speaks for itself.” She referred questions to an Allstate corporate spokes­woman, who couldn’t be reached by deadline.

Other defense attorneys also couldn’t be reached.


The decision reverses or­ders dismissing the suits by separate trial judges relying on Glover v. Liggett Group, a 2006 Eleventh Circuit opinion. But that case was different, Anderson wrote. Glover involved an alleged tortfeasor, and so the court ruled that a judge or jury must first determine liability before the MSP Act could be used as a vehicle for recov­ering costs.

The plaintiff in Glover was attempting to force tobacco companies to pay health care costs because of the known hazards of smoking. The Eleventh Circuit said no, the law couldn’t be used to substitute for a liability judg­ment.

“We knew our situation was different because our defendants were insurance companies,” said Beverly Pohl, who heads the state­wide appellate group at Broad and Cassel in Fort Lauderdale and briefed the appeal for MSP Recovery. She said Ruiz, a class­mate at Nova Southeastern University law school 25 years ago, called her to han­dle the appeal last year after losing at the trial level.

“I hadn’t talked to John in a while,” she recalled. “He said, ‘I heard you’re a ba­dass. ‘”

Pohl argued the dis­trict courts were wrong to dismiss the claims on the basis of Glover, which she said only applied to claims arising from tortfeasor re­sponsibility. The existence of a contractual obligation to pay would in itself trigger the MSP Act’s private cause of action.

“It is a fundamental prin­ciple of contract law that a contract imposes enforce­able rights and obligations,” Anderson wrote. “A contract imposes obligations on the parties immediately, with­out any involvement of the courts. While a lawsuit may be necessary to enforce a contract in the event of a breach, the obligations cre­ated by the contract exist as soon as it is executed.”

Ultimately, MSP Recovery may have to go to court to enforce the contracts in these cases. Ruiz acknowledged, but the potential for double recovery may prove persua­sive: “It’s like a hanuner over the head.”