The Seven Scariest, Most Horrifying Health Care Subrogation Cases of All Time

NASP 2007: Subrogation – And All That Jazz!

Introduction/Opening Remarks:

“THE GRAVEYARD SHIFT IS BEST. NO BONES ABOUT IT.”

• Our Goal:

Understanding how truly scary subrogation has been over the last few years and how to clean those past skeletons out of your work closet.

• Opening Story:

Sometimes during late night work sessions, I can feel the presence of the ghost of subrogation past and there have been many times when I have been haunted by visions of the dark future of a world without healthcare subrogation.

Introduction/Opening Remarks:

The Scary Seven: NASP 2007

Sereboff v. Mid Atl. Med. Servs., 126 S. Ct. 1869 (2006)

a. The Trick:

The member’s attorney is ready to carve out a little bite of justice under equity. By using the footnote in the Supreme Court’s

decision, adverse attorneys hope to bring in make-whole and common fund arguments.

b. The Treat:

Make sure to use your evil eye and read exactly what Justice Roberts says in the footnote. The Supreme Court simply did

not address these issues, so there is nothing left for the member’s attorney to keep screaming about.

Case Number One - Let’s carve out some good times.

The Scary Seven: NASP 2007

Empire HealthChoice Assur., Inc. v. McVeigh, 126 S. Ct. 2121 (2006)

a. The Trick: FEHBA – R.I.P. 2006

Members’ attorneys will convince you that the federal courts were the only place to bury all of your dead FEHBA cases,

hence under McVeigh, no recoveries are now possible.

b. The Treat:

While McVeigh is definitely a dagger in the heart of FEHBA, you may still have a silver bullet to use in a properly filed state court action.

Case Number Two – You’ll be wanting your mummy.

The Scary Seven: NASP 2007

Popowski v. Parrott, 461 F.3d 1367 (11th Cir. 2006)

a. The Trick:

After Sereboff, make sure not to celebrate to soon on caramel apples and candy corn. This little nightmare called Popowski

or Carillo will definitely make your tummy hurt if the member’s attorney finds a deficiency in your plan language.

b. The Treat:

Most plans call for the member to pay you from the third-party funds (i.e., their candy bag).

Case Number Three - Eat, drink and be scary.

The Scary Seven: NASP 2007

Bishop v. Burgard, 198 Ill. 2d 495 (Ill. 2002)

a. The Trick:

By filing quickly in the state court, a member’s attorney can ensure that the judge will sink his fangs into your subro

dollars, most likely causing a loss of blood of about 1/3.

b. The Treat:

An independent action in federal court may be the blood transfusion you’re looking for to keep your subro cases’ heart pumping.

Case Number Four - Come in for a bite.

The Scary Seven: NASP 2007

Cagle v. Bruner, 112 F.3d 1510 (11th Cir. 1997)

a. The Trick:

This make-whole case is going on its tenth year of creeping and crawling through the graveyard of subrogation.

b. The Treat:

As with all make-whole cases, plan drafting is the key. Hence, early prevention removes any danger. It’s always best if you check your candy before you eat it. So don’t be a scaredy cat! Update your plan language every year.

Case Number Five - Don’t be a scaredy cat!

The Scary Seven: NASP 2007

Cooper Tire & Rubber Co. v. Striplin, 652 So. 2d 1102 (Miss. 1995)

a. The Trick:

Watch out for state court judges that love to cause nightmares in your cases involving minors. It won’t be the children that are

calling for their mommies at the end of these subro cases.

b. The Treat:

You may be able to save yourself from the grim reaper if you have an ERISA-covered health plan and preemption applies.

Case Number Six - Little demons are a ghoul’s best friend.

The Scary Seven: NASP 2007

Great-West Life & Annuity Ins. Co. v. Bullock, 202 F. Supp. 2d 461 (D.N.C. 2002) 

a. The Trick:

Some attorneys forget to handout candy to subrogation specialists that come knocking. Just because the member’s attorney knows you’re coming to his door, doesn’t mean he is going to answer.

b. The Treat:

Every state has different ethical rules, so just because one attorney can hide in the dark, many others will have to leave their porch light on for you.

Case Number Seven - Forget the ghosts . . . beware of the member’s attorney.

The Scary Seven: NASP 2007

Ending Remarks: “Bats All Folks”

Lance K. OliverLAWRENCE & RUSSELL, LLP5050 Poplar Avenue, Suite 1717 Memphis, TN  38157

Telephone:  901-844-4431Facsimile:  901-844-4435E-mail:  lanceo@lawrencerussell.com