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Do I have to sign the release for my PI settlement when Medicaid/Medicare are falsely claiming I owe them payback out of it?

New Egypt, NJ |

I have made a verbal agreement to a PI settlement. Now, Medicaid and Medicare are claiming I owe them reimbursement out of my settlement, but the truth is neither one ever paid one red cent on my injury. I did not start receiving Medicaid until after my injury was already healed. I did not start receiving Medicare until three years after the accident.

What steps need to be taken against Medicaid and Medicare's false claims?

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Attorney answers 6

Best Answer

Don't sign the release until your lawyer has resolved this, otherwise, your lawyer will have no incentive to do so, and you will be left holding the bag.


You don't have to sign the release but you will not get the settlement proceeds if you don't. Medicare and Medicaid have a statutory right to money obtained via a third party claim. That being said, the lien is generally limited to amounts they actually expend on treatment related to the accident which gave rise to the settlement. Have you discussed this with your attorney? He/she should be negotiating with Medicare and Medicaid to have the lien reduced or waived accordingly.

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Medicare and Medicaid have very specific statutory liens in matters suich as this. You should speak with your attorney in order to determine the amounts of the liens, as well as how your settlement may affect your eligability for these benefits in the future. Because Medicaid is a financial need based system, the amount of your settlement may potentially affect your eligability for Medicaid in the future. In certain situations a Medicaid Special Needs Trust can be set up which may allow you to maintain your benefits, despite the amount of your settlement. Additionally, Medicare may assert a credit against your settlement for future accident related medical expenses, and therefore may refuse to pay for all or part of your future medical treatment. A Medicare Set Aside could be constructed, but it is fairly complicated. Once again, I strongly recommend that you speak with your attorney.


Have your counsel deal with this before signing any and all releases.

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Medicaid and Medicare are dealt with slightly differently when it comes to pay backs from a personal injury settlement, though they are similar in that there is a statute that absolutely requires you to pay back the money – which is a lien on the settlement (assuming of course that it is valid). You always have the right to contest the lien and the amounts of the lien – which your current attorney should handle for you.

Depending on what you mean by a verbal agreement – it may be too late to get out of the settlement, regardless of whether you signed the actual release or not. If you told your attorney that you would accept the settlement, and your attorney told the other side that you accepted – then for almost all situations, that case is considered settled for that amount even if all of those statements are verbal and nothing is signed.

Each case is fact senstive, so all answers should be viewed as general advice only, and should never replace a thorough and in depth consultation with an experienced attorney. Further, an answer should not be seen as establishing an attorney-client relationship.


Have your attorney resolve this issue before signing anything!

The above is general information only and is not legal advice. The information provided does not form an attorney-client relationship, and should not be relied upon to take or refrain from taking any action. I am not your attorney until we sign a retainer agreement.

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