Category Archives: third-party liability settlements

Workers’ Comp Goes Federal: An Update

The other day, I wrote a post that said that state Medicaid programs will be able to recover all of the proceeds from a settlement that were expended on behalf of a beneficiary.

My reporting of MaryRose Reaston’s article garnered some very positive comments from some of my readers.

Yet, today, my fellow blogger Joe Paduda countered MaryRose’s article, and stated that “No, ACA has not ‘overstepped its bounds‘”.

According to Joe, the efforts by the states are just that, state-based, and they are allowed and enabled by federal legislation…separate and distinct from the ACA.

Joe cites an article written by Michael Stack, Principal of Amaxx LLC that summarizes Medicaid recovery in workers’ comp cases.

As Joe reports, Michael noted that the legislation that allows Medicaid to pursue settlements was part of the Medicare Secondary Payer Act, a part of the 2013 budget bill.

Normally, when I write about some issue someone else wrote about, I never have to provide my readers with an update that challenges the original author. Generally, my updates are just that, updates that add to the discussion. This is not the case here.

So just to be fair to everyone, I decided to correct the situation by writing a follow-up. I trust my readers will understand that I did not mean to mislead or take only one side.

Workers’ Comp Goes Federal

MaryRose Reaston, founder of Emerge Diagnostics, wrote an article on Insurance Thought today that said the Affordable Care Act (ACA), also known as “Obamacare” will dip into Workers’ Comp.

According to MaryRose, as of Oct. 1, 2016, state Medicaid programs will be able to recover all of the proceeds from a settlement that were expended on behalf of a beneficiary.

Medicaid, she says,  will be able to attach a beneficiary’s third-party liability settlement (including workers’ compensation) for the entire amount of the beneficiary’s award, and not just the amount allocated to medical expenses.

What this means, Reaston adds, is that funds intended to compensate beneficiaries for pain and suffering, lost wages or any damages other than medical expenses could be subject to the reach of state Medicaid agencies seeking recovery.

Many employers will be affected because the adoption of the ACA has afforded broader coverage under state Medicaid programs, MaryRose writes, because it now includes individuals who are within 133% of the federal poverty level (about $32,252.50 for a family of four in 2015), and under 65 years of age.

For the complete article, click on the following link: