Opinion ID: 783835
Heading Depth: 2
Heading Rank: 1

Heading: the medicare as secondary payer statute

Text: 3 Prior to 1980, Medicare generally paid for medical services whether or not the recipient was also covered by another health plan. See Social Security Amendments of 1965, Pub.L. No. 89-97, § 1862(b), 79 Stat. 286. However, beginning in 1980, Congress enacted a series of cost cutting amendments to the Medicare program. These amendments are collectively known as the Medicare as Secondary Payer (MSP) statute or the MSP provisions. See New York Life Ins. Co. v. United States, 190 F.3d 1372, 1374 (Fed. Cir.1999). 2 4 The MSP statute was designed to curb skyrocketing health costs and preserve the fiscal integrity of the Medicare system. See Zinman v. Shalala, 67 F.3d 841, 845 (9th Cir.1995); H.R.Rep. No. 96-1167, at 352 (1980). The MSP attempted to lower overall federal Medicare disbursements by requiring Medicare beneficiaries to exhaust all available insurance coverage before looking to Medicare's coverage. See United States v. Rhode Island Insurers' Insolvency Fund, 80 F.3d 616, 618 (1st Cir.1996). The MSP assigns primary responsibility for medical bills of Medicare recipients to private health plans when a Medicare recipient is also covered by private insurance. These private plans are therefore considered primary under the MSP and Medicare acts as the secondary payer responsible only for paying amounts not covered by the primary plan. 3 Blue Cross and Blue Shield of Texas v. Shalala, 995 F.2d 70, 73 (5th Cir.1993). 5 Congress established two principal directives to achieve this objective. First, the MSP bars Medicare payments where payment has already been made or can reasonably be expected to be made promptly (as determined in accordance with regulations) by a primary plan. 42 U.S.C. § 1395y(b)(2)(A) (parenthetical in original). Prompt payment is defined in the applicable regulations as payment made within 120 days of either the date on which care was provided or when the claim was filed with the insurer, whichever is earlier. See 42 C.F.R. §§ 411.21, 411.50. The MSP defines a primary plan as a workmen's compensation law or plan, an automobile or liability insurance policy or plan (including a self-insured plan) or no fault insurance[.] 42 U.S.C. § 1395y(b)(2)(A)(ii) (parenthetical in original). This provision is intended to keep the government from paying a medical bill where it is clear an insurance company will pay instead. Evanston Hosp. v. Hauck, 1 F.3d 540, 544 (7th Cir.1993) (citation omitted). 6 Second, the MSP provides that when Medicare makes a payment that a primary plan was responsible for, the payment is merely conditional and Medicare is entitled to reimbursement for it. 42 U.S.C. § 1395(y)(b)(2)(B); Blue Cross and Blue Shield of Texas v. Shalala, 995 F.2d 70, 73 (5th Cir.1993) (2002). Section 1395y(b)(2)(B) provides: 7 Any payment under this subchapter with respect to any item or service to which subparagraph (A) applies shall be conditioned on reimbursement to the appropriate Trust Fund established by this subchapter when notice or other information is received that payment for such item or service has been or could be made under such subparagraph. 8 42 U.S.C. § 1395y(b)(2)(B)(i). Medicare payments are subject to reimbursement to the appropriate Medicare Trust Fund once the government receives notice that a third-party payment has been or could be made with respect to the same item or service. 4 Id.