Growing up, you probably didn’t realize you had an Uncle Sam. He never sent you birthday cards, wasn’t in any of the family photos, and no one ever shared amusing anecdotes about him at reunions or weddings. Then one day, probably when you were a teenager, he suddenly showed up, and nothing was ever the same. It was a day you will always remember. It was the day you got your first paycheck. Ever since then, old Uncle Sam has been an ever-present force in your life, showing up whenever the money does to remind you to pay his dear friend FICA for services rendered. Even though you weren’t close growing up, you now have a mutually beneficial relationship, filled with the give and take that comes with being an adult: he takes your money and gives you schools, public transportation, and social programs.
Uncle Sam is there to look out for you, which is why he provides programs like [url=http://www.medicare.gov/]Medicare[/url] and [url=www.cms.hhs.gov/]Medicaid[/url] to help cover inflated hospital bills and treatment expenses. The coverage afforded by these programs is invaluable to many of his nieces and nephews, particularly those who have been hurt in an accident, car crash, dog attack or by defenctive products, but his protection comes at a price, and this old timer always gets paid. However, if you stay informed, you may find that his piece of your financial pie is limited.
Say you are granted Medicare or Medicaid benefits for your treatment costs after an accident. The state agrees to cover expenses using federal funds, but will probably establish a [url=www.lectlaw.com/def/l036.htm]lien[/url], which ensures that after you receive a settlement, the state may recover some funds by claiming a portion of the settlement. However, because of the [url=http://126.96.36.199/~elderlaw/Articles/LienRecovery.pdf]lien prohibition[/url], the state is only entitled to repayment for the stipulated amount of past medical expenses.
This condition is best illustrated by the landmark case, [url=http://www.supremecourtus.gov/opinions/05pdf/04-1506.pdf]Arkansas Department of Human Services v. Ahlborn.[/url] In the case, the [url=www.state.ar.us/dhs/]ADHS[/url], which administers Medicaid in Arkansas, sought a lien on damages Ahlborn received from defendants while agreeing to cover her medical bills. The state attempted to recover nearly half of Mrs. Ahlborn’s $550,000.00 settlement, an amount which included compensation for her lost wages, pain and suffering. The Supreme Court unanimously upheld the appellate court decision, saying that ADHS was entitled only to the percentage of the settlement that applied to her past medical care (only about 16%).
If you are supported by Medicare or Medicaid, it is important to know that the government is entitled to its portion of your car crash case or dog attack settlement, but it is even more crucial to understand how large that portion is and that it is limited. As a general rule of thumb, give credit where credit is due: if Uncle Sam helps you cover a hospital bill inflated by $7000 ambulance rides across town and $10 aspirin, then he is probably within his right to get paid once you do; however, as a stipulation of Medicaid and Medicare, the government cannot claim your property. The government has no right to the portions of the settlement awarded as compensation for other elements of damage, like pain and suffering. The settlement, minus the amount Uncle Sam has given your local medicine men, is your property. If the cost of medical treatment is stipulated before the settlement is awarded, that is where the line is drawn to limit payment of a lien.
The property provision also keeps the state from recovering more than the amount of your car crash case or product liability settlement. If the amount you receive after an accident is less than the amount of your previous medical expenses, the government cannot demand the remaining amount from your pocket. It is also possible to apply to the state for a reduction of a lien if the amount of your settlement is not high enough to prevent financial loss on your part. An experienced personal injury ttorney can properly advise you of your rights and help you through the paperwork and technical aspects of dealing with medical coverage and settlements. This is the best way to make sure that you protect your assets and get fair compensation for your injuries. Remember that even though the state is entitled to payment, the government’s claim on your settlement is not infinite. When Uncle Sam shows up, knowing your rights can pay off.