This is an issue which you need to discuss with your attorney. You may be able to post bond pending appeal so that you do not have to pay anyone immediately. If it turns out you must pay someone, and if the federal government has a lien on the case, your attorney can work out the appropriate procedure to see that the payment goes first to satisfy the lien.
I am licensed in California only and my response assumes California law. It is provided as general information only and is not legal advice. It must not be relied upon by you. Legal advice must be based on the exact facts of the particular situation. This forum does not allow for the discussion of those specific, exact facts. I provide legal advice only during the course of an attorney-client relationship. The exchange of information through this forum does not establish such a relationship with me. That relationship is established only by personal and direct consultation with me followed by the execution of a written attorney-client agreement by each of us. In this, as in all cases, you should personally consult with an attorney in your area for legal advice.
If you have been served with some type of writ or notice of a lien then you will want to honor that court order. If it is confusing as to who to pay you may want to deposit the funds with the court and ask the court for direction.
The federal government has a statutory lien for payments made under the Medicare Secondary Payer Act (“MSP”). The Act provides that Medicare may not make payments when payment has been made or can reasonably be expected to be made promptly under worker’s compensation or automobile or liability insurance policies or plans (including a self-insured plan) or no-fault insurance. Any such payment shall be conditioned upon reimbursement from the primary plan.
Where there is a "conditional payment,” the United States may bring an action against the primary plan responsible for payment, and “the United States shall be subrogated” for the payment of those expenses from the primary plan. If it is necessary for the Centers for Medicare and Medicaid Services (“CMS”) to take legal action to recover from the primary payer, then CMS may recover double damages.
Party Making Payment
CMS has a direct right of action to recover from any entity responsible for making primary payment. This includes an employer, an insurance carrier, plan, or program, and a third party administrator.
Party Receiving Payment
CMS also has a right of recovery from parties that receive third party payments. These include a beneficiary, provider, supplier, physician, attorney, state agency, or primary insurer that has received a third party payment.
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