Medical malpractice lawsuits have gotten increasingly difficult to pursue in recent years. Increasing costs of litigation, negative public opinion, and unnecessary tort reform measures enacted by legislators corrupted by donations from Big Business, Big Insurance and Big Medicine, have led to an overall reduction in the number of medical negligence claims being pursued, while rates of medical negligence remain frighteningly high. If this were not enough, a new law further guts the rights of victims of poor medical care.
Hidden in the Bipartisan Budget Act (BBA) recently approved by Congress is language that is damaging to plaintiffs covered by Medicaid. The provision overturns a unanimous 2006 United States Supreme Court decision in United States vs. Ahlborn. In Ahlborn, the Supreme Court ruled that only the portion of the settlement that represented payment for medical expenses could be claimed by the state Medicaid agency. The BBA allows a State to claim ALL of a settlement or judgment. The BBA provision will result in plaintiffs who are Medicaid recipients recovering less or, in many cases, it will make it economically infeasible to pursue claims altogether since the entire recovery will have to be reimbursed to Medicaid.
Currently, Medicaid and Medicare are entitled to reimbursement for funds expended on behalf of victims of medical malpractice. However, the subrogation lien could only be satisfied from that portion of the recovery that reflected payment for medical expenses. Further, the subrogation interest is subject to a setoff for attorneys fees and expenses incurred in making the recovery. The subrogation interest was also subject to negotiations when the recovery resulted from a compromise settlement. Now, the Centers for Medicare and Medicaid Services (CMS) can set their sights on the entire recovery without regard for these other factors.
The reason behind the change is to raise revenue, but this is specious when considering that fewer claims will be brought if the tort victim is likely to recover nothing. The BBA provision probably constitutes an unconstitutional taking by the overreaching government. Moreover, this legislation is immoral in that it taxes tort victims’ recoveries for pain, suffering and lost wages.