Last month, the United States Supreme Court heard arguments in a case that could affect an untold number of Americans. The case before the court centers on a girl who is deaf, blind, mute and cannot walk, crawl or even sit without assistance. When the girl was being delivered, she became the victim of medical malpractice which resulted in her current physical state. She and her parents were subsequently awarded $2.8 million in a malpractice settlement.
However, the girl's home state of North Carolina asserted a lien on one-third of the judgment money awarded in the case. The young girl is a Medicaid beneficiary and the state estimates that it has spent nearly $2 million on her medical expenses to date. Like many other states do, North Carolina asserts the right to retain the lesser of one-third of malpractice judgments or the total Medicare expenditures for an affected patient.
On one side of this debate are cash-strapped states looking for reimbursement for taxpayer dollars that have gone to support medical malpractice victims. On the other hand are the victims themselves, who are in need of every dollar awarded in the malpractice suits they have won.
To make matters even more complicated is federal law on the subject, which may conflict with any number of state laws related to medical malpractice and Medicaid. Generally, federal law prohibits liens on malpractice awards because they are considered property of the Medicaid recipient. Yet, Supreme Court precedent seems to suggest that only awards related to pain and suffering are immune from liens.
Whatever holding the Supreme Court eventually hands down will undoubtedly affect Medicaid recipients who are victims of medical malpractice. Chances are that approaches to these malpractice cases will need to be modified accordingly.
Source: Miami Herald, "Supreme Court case involves medical malpractice awards, Medicaid," Michael Doyle, Jan. 7, 2013