Third Party Liability, Liens, and Workers Compensation
Post on 25-Feb-2016
DESCRIPTIONThird Party Liability, Liens, and Workers Compensation. By Isaac S. Schreibman, Esq. Presented to the Wisconsin Revenue Cycle Co-op/AAHAM May 8, 2014. Agenda. Defining Third Party Liability Hospital Liens: Protecting Provider Rights to Reimbursement How Does it Work in Wisconsin? - PowerPoint PPT Presentation
Third Party LIABILITY & Hospital LIENS
Third Party Liability, Liens, and Workers CompensationBy Isaac S. Schreibman, Esq.Presented to the WisconsinRevenue Cycle Co-op/AAHAMMay 8, 20141AgendaDefining Third Party LiabilityHospital Liens: Protecting Provider Rights to ReimbursementHow Does it Work in Wisconsin?Required Elements and Recommended Perfection TipsSample Lien The Reimbursement ProcessImportance of Follow UpAdditional Reimbursement OpportunitiesLien AdjudicationEvaluating Settlement OffersHow to Handle BankruptcyWorkers CompensationCase Studies
Defining Third Party Liability: Important TermsMed Pay/Personal Injury Protection: Patients auto policyLimited benefits Claims are paid in the order they are submitted and until benefits are exhausted.Liability Insurance: Negligent partyUnderinsured or Uninsured Motorist Protection: Patient auto insuranceSubrogation: Patient right to recover is transferred to a third party (e.g. health insurance or Medicare) via contract and after paymentStatute of Limitations: Personal injury caseIn Wisconsin, must be filed within 3 years of occurrenceLien: Creditors secured interestTortfeasor: Negligent party
3Defining Third Party Liability: Negligence
The omission to do something which a reasonableman, guided by those considerations which ordinarily regulate human affairs, would do, ordoing something which a prudent and reasonableman would not do.~Ballentines Law Dictionary
Not all accidents and injuries are the result of negligence!4
Defining Third Party Liability: Common Types of Liability Claims
Defining Third Party Liability: Anatomy of a Personal Injury ClaimAuto DriverAuto OwnerPedestrianBicyclistHomeownerBusiness OwnerParentsGovernmental EntitiesManufacturers (Product Liability)Contributory Negligence
6Identifying Third Party Liability
Attorney requests for bills or medical recordsEmergency room carePolice or EMT reportsPatient contact/interviewTherapy chargesTrauma diagnoses
Defining Third Party Liability: Indications of a CaseHigh-dollar open balance accounts (greater than $10,000)
Accounts with communication (written or verbal) from an attorney representing a patient:Attorney requests for itemized bills or medical recordsSettlement offers or requests to reduce the outstanding chargesLegal pleadings (e.g. Subpoena, Complaint)
Always evaluate for potential third party reimbursement or Financial Assistance eligibility prior to sending accounts to collections.
8Handout-identification of TPL8Hospital Liens: Protecting Provider Rights to Reimbursement Why should I pursue liability cases?Maximize reimbursement and potentially recover total chargesCreates a secured interestCreates a right to payment from third partiesAllows providers to built trust with patients by advising patients of their rights to a liability claim
What does it take to pursue a liability case? Dealing with patients attorneysSpecialized, thorough, detailed knowledge of regulations and processPreparation and perfection of Hospital Lien9Hospital Liens: Protecting Provider Rights to Reimbursement10Hospital Liens: Protecting Provider Rights to ReimbursementHow Does it Work in Wisconsin?Lien right is created by state statute. Strict compliance with all provisions is required (Chapter 779.80-Wisconsin Revised Statues).
A hospital lien attaches to any and all rights of action, suits, claims, demandswhich such injured personmight have against any such other person for damages on account of such injuries, for the amount of the reasonable and necessary charges of such hospital.
Third party payers are liable to the hospital for the amount of the lien for one year from the date of the payment. 779.80(4) WRS
Third party payers may advise they have received a release or patient attorney has assumed responsibilitythe payer remains liable for payment until the hospital releases its lien!
Handout copy of statute to review11Hospital Liens: Protecting Provider Rights to ReimbursementRequired Lien Elements:Name & address of patient (injured party)Date and location of accident/injuryName & address of hospitalName & address of Tortfeasor
Recommended Lien Elements:Liability insurance carrierLien should be be verified
Perfecting the Hospital LienProtecting Provider Rights to ReimbursementFile in the circuit court of the county where the injuries occurred or where the hospital is located.File within 60 days of patients discharge from the hospital.Send a copy of the notice by certified mail to the injured party and the person liable for those injuries within 10 days of filing the notice of lien. Include the date of filing.The hospital shall also serve a copy of the notice of lien on any insurer which has insured the party alleged to be liable for the injuries.
If such hospital fails to give notice if the name and address of the person injured or the person allegedly liable for the injury are known or should be known, the lien shall be void. 779.80 WRS Section (3)(b)
14Hospital Liens: Protecting Provider Rights to ReimbursementWant a perfect lien? Know the details:Negligent Party (Tortfeasor)Negligent Partys attorneyNegligent Partys liability insuranceOther negligent parties
Liens should be served on all parties who have or may have funds payable to the injured party.15
Sample Lien: Header Information16NOTICE OF HOSPITAL LIEN Injured Party: Baron Rollo 27763 W. Lakeview Drive N Lake Barrington,IL60084 Injured Party's Attorney: Dewey, Cheatum and Howe 2525 Dempster Evanston,IL 60202 Liable Party: Jim Jones P.O. Box 456 Los Angeles, CA 89898 Liability Carrier: Mutual Insurance Company 5420 W South St. Philadelphia, PA 45124 Claim No.:B1234 Additional Liable Party: Acme Truck Co. 1417 E. West Rd Milwaukee, W! 40151 Liability Carrier: State Insurance Co 1 Robinson St New Orleans, LA 78487 Claim No.:A1234 Sample Lien:Body Content 17You are hereby notified that Baron Rollo, residing at 27763 W. Lakevie w Drive, N. Lake Barrington, IL 60084 was injured on or about 03/11/12, at SR 35 and Ely Road, Neenah, WI as a result of the negligence of Jim Jones , P.O. Box 456,Los Angeles, CA 89898. You appear to be holding funds or expect to be holding funds in the futureagainst which Memorial claims a Hospital-Hospital Lien Baron Rollo is a patient in the hospital indicated below or was a patient from 04/12/11 due to said injuries. Memorial Hospital- located at P.O. Box 841, Wauconda, IL 600 84, claims a lien upon any claim or demand or cause of action which the said injured party may have against the alleged liable party, and against any funds you may have presently or in the future which may be directed as payment to the injured party. This lien is authorized by the terms and provisions of the statutes of the State of Wisconsin (Ch. 779.80 WRS) relating to Hospital Liens. This lien is for the amount of the reasonable and necessary charges for the services rendered and to be rendered in the treatment, care and maintenance of such injured person. All notices, including any notice to adjudicate are to be sent to The Law Office of Isaac S. Schreibman at the address below. Amount of Lien: $100.00 Sample Lien:Concluding Elements18Date: April 15, 2012 Client: Memorial Hospital-Test Account(s): 000123 By: The Law Office of Isaac S. Schreibman Attorney for Memorial Hospital-Test P.O. Box 841 Wauconda,IL 60084 847-756-7606 VERIFICATION _________________________ being duly sworn on his/her oath deposes and says that she/he is the duly authorized agent of Memorial Hospital-Test,that she/he has read the foregoing NOTICE OF HEALTHCARE PROVIDER LIEN and that all of the facts therein stated are true and correct. PROOF OF SERVICE The undersigned, being of legal age and being first duly sworn on oath, deposes and states that on ___________________, I served the foregoing Notice of Hospital Lien upon the above-mentioned persons by mailing a true copy thereof by certified mail and/or fax, email,regular mail to the above named persons at their respective addresses above shown. Sworn and Subscribed before me on this______day of _____________, 2012. ____________________________ Notary Public/Attorney State of Illinois County of Lake The Reimbursement Process: Executing Diligent Follow UpContact all parties and confirm lien was received
Confirm case status with patients attorneys and liability carriers
Confirm maximum benefits available
Confirm liens served by other providers
Follow up every 45-60 days 19
The Reimbursement Process: Additional Reimbursement OpportunitiesWorkers CompensationCheck for health insurance Review HMO contractsMay be obligated to accept payment from health insurerMedicaid and MedicarePayers of Last ResortProvider must make an election20The Reimbursement Process: Medicare as a Secondary Payer (MSP)Medicare pays only after all other potential third party sources of payment
First 120 days after service, provider must pursue third party
After 120 days, provider can bill Medicare if it appears the third party will not pay promptly, or at all
Provider must release lien if Medicare is billed
Careful evaluation of third party payment potential is required to make correct election. Be aware of billing deadlines.
Liens will result in higher reimbursement than Medicare (in most cases)
Medicare has priority to all other liens at the time of settlement of the liability case
21No set percentage or amount for provider provided for by statuteWisconsin statute provides for no minimum recovery by patientCourt has the authority to adjudicate liens among lien holdersPatient is responsible for any amounts remaining after partial payment of lien, unless adjudicated or compromised
22The Reimbursement Process: Adjudication of Liens
The Reimbursement Process: Evaluating Settlement OffersTotal amount of the settlementAmounts and types of other liensDistinguish between bills and perfected liensOffer to compromise account or lienPatients attorneys willing to reduce fee?Patient willing to complete a financial assistance application for balance remaining after settlement?Medicare liens23
The Reimbursement Process: How to Handle BankruptcyLien must be perfected prior to bankruptcy
Claim should be scheduled as Priority and Secured
Valid liens will survive if objection to discharge is filed (adversary claim)
Discharge by Bankruptcy Court terminates patient responsibility but not lien
Workers CompensationProcess for adjudication of claims to prevent employees from suing employers for injuries sustained in the workplaceHealthcare providers have no right to a lienPatient is not responsible for payment unless:Patient or attorney are not cooperativeInjuries found to be non work-relatedCompensates injured employees for actual losses, not pain and suffering or punitive damages to punish the negligent partyClaims generally resolved faster than liability cases in state courtEmployers are required to have Workers Compensation Insurance
25Liability vs. Workers CompensationLiabilityWorkers CompensationAttorney FeesAgreement between client and attorneySet by statuteHospital LiensYesNoStandard of ProofNegligenceWithin the scope of employmentDamagesDetermined by judge or jurySet by statutes and regulationsForumState CourtAdministrative Agency26Initial Inquiry (Written request to attorney)In order to assist us in completing our investigation, please provide the following information;
Did the Patient have health insuranceDate of InjuryNature of injuryConfirm name of employerName of employer's insurance carrierAdjuster contact informationCopy of the Notice of Application
27Process and ProcedureDepartment of Workforce DevelopmentFile case-if damages not paid voluntarily by employerNotice of ApplicationAnswer (within 20 days)End of Healing (form 16(b))Certificate of Readiness28DocumentsApplicationEmployers Answer (within 20 days)Certificate of ReadinessNotice of Hearing (2 months)Hearing Date (2-4 months from Notice)Hearing in front of an Administrative Law JudgeSettlement Agreement-Needs to be approved by DWD-Payment within 21 days of approval29Process and Procedure (continued)Hearing Date (60-120 dates from filing of notice)File WCK3-list of medical expenses with supporting billsHearing (evidence and witnesses)-Administrative Law JudgeReimbursement Rate-Reasonable and Customary ChargesEmployee has right to bring a third party action (liability)
30Workers Compensation and Health InsuranceWorkers Compensation denial letterDemand payment from Employer (Health Fund)Advise of the right of SubrogationEnlist the assistance of the patients attorneySubmit denial letter and itemized bills with medical records31Employers without Workers Compensation InsuranceWisconsin Uninsured Employers FundSubrogationASU Group (State Adjuster)32Questions and Comments33Case Studies: InterventionSituation:A patient was injured at work. Neither the patients health insurance carrier nor the workers compensation plan had paid the claim. The patients attorney filed suit in state court against the health insurer (an ERISA plan) and the workers compensation carrier. The health plan removed the case to federal court.
Action:Our office filed a Petition to Intervene on behalf of the hospital, naming both insurance carriers as Defendants.
Result:After holding a mediated settlement conference, a settlement was reached whereby each insurance company agreed to pay 50% of negotiated charges. The original bill was over 2 years old.
34Case Studies: The Imperfect LienSituation:The patient settled a personal injury case for $100k. The hospitals lien did not name the patient and was technically void under the relevant statute. The patient was an adult, but her mother had signed a payment guarantee at the time of service.
Action:We advised the patients attorney all parties had constructive notice of the hospital's claim as the imperfect lien was recorded by the county court. To further leverage the payment guarantee, we emphasized that legal responsibility for the outstanding debt ($108k) fell upon the patients mother who had signed the guarantee of payment.
Result:We negotiated a settlement of $30k.35For Additional Information or Copies of Referenced Material:
Ike SchreibmanThe Law Office of Isaac S. Schreibmanike@ikeschreibmanlaw.com847.756.7606 (C)847.970.8248 (F) 36