Rebecca Meek-Horton v. Trover Solutions Inc. et al (State of New York, Supreme Court, New York County, Case No. 108804-2011)
A lawsuit naming 50 insurers as defendants has been filed in New York Supreme Court, New York County. The complaint relates to Medicare Advantage plans and accuses the insurers of violating a 2009 state law by imposing liens on patients who receive personal injury settlements. The law bars insurers from pursuing liens on settlements absent statutory authorization, and questions exist regarding whether Medicare Advantage insurers are granted that statutory right. Medicare has a statutory right to impose liens, and the insurers are claiming a derivative right. A recent trial court case held that the insurers did not have a right to subrogation.
The law, General Obligations Law Section 5-335 (McKinney’s 2011), created a conclusive presumption that personal injury settlements do not include health care costs, except where there is a statute authorizing a carrier to establish a lien. Accordingly, health care providers cannot establish a lien on personal injury settlements because there is no statutory authorization. It is alleged that the Medicare Advantage policies attempt to provide liens for the benefit of health care providers, in violation of the statute.
The class representative plaintiff settled a personal injury claim, only to have an insurer impose a lien on the proceeds to recover for medical costs. The suit seeks an injunction prohibiting such liens and restitution. The class size is currently unknown, but could potentially include thousands of personal injury plaintiffs who settled cases since 2009.
A copy of the complaint can be found here