Medicaid FAQs

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Medicaid

What is Medicaid?

Medicaid is a health insurance program for low-income individuals and families. Qualification for Medicaid is based on economic need. It provides payment to medical providers for treatment and services if you are sick or hurt. However, if you are hurt in an accident caused by someone’s negligence, then Medicaid is entitled to put a lien on any future recovery to be reimbursed for the payments it made on your behalf.

These subrogation and lien rights for Medicaid are outlined in N.C. Gen. Stat. § 108A-57. This statute specifically requires that any attorney retained by the beneficiary who is receiving Medicaid services shall, out of the proceeds obtained on behalf of the beneficiary by settlement with, judgment against, or otherwise from a third party by reason of injury or death, distribute to the Department the amount of assistance paid by the Department.

What steps are taken if you have Medicaid?

First, we immediately notify Medicaid of your pending claim. The Medicaid claim is handled by the North Carolina Department of Health and Human Services, Division of Medical Assistance. (DMA)

Medicaid will then issue an acknowledgement letter to us. Medicaid will request that we allow six (6) to eight (8) weeks to respond to our requests.

Medicaid will issue letters to us which are called “Liens.” These liens will state the amount which Medicaid paid on your behalf and which it believes should be reimbursed at the resolution of your case.

If unrelated claims are included in the lien we receive, then they can be disputed at this stage, which can be very time consuming and frustrating. This dispute stage can delay the resolution of your case, but it is important not to reimburse Medicaid for bills that are not related to your accident and injuries. You should only reimburse Medicaid for bills related to your case.

Lien amounts received from Medicaid are only “valid” for a period of thirty (30) days. After the 30 days expires the lien is considered void and a new lien amount must be requested. This 30 day period can create delays and confusion, especially if unrelated charges are included.

Medicaid and Your Settlement

Once a settlement is reached you will execute documents and releases formalizing your acceptance of the settlement. After this is completed, we will notify Medicaid of the settlement and request that Medicaid send us the final amount it claims we must reimburse Medicaid. At this point, we may then be allowed to disburse the settlement proceeds.

In some cases, insurance limits and legal issues may cause Medicaid’s lien to be greater than a recovery or take too much of the recovery. However, there are provisions which allow for a pro rata disbursement of settlement proceeds with other medical lien holders. These pro rata statutes can be found at N.C Gen. Stat. § 44-49 and 44-50. These statutes give the attorney specific direction as to how proceeds can be distributed if all medical providers are unable to be paid in full out of the settlement. However, the North Carolina Statutes on Medicaid will control the disbursement. This portion of your case can be complicated and requires direct discussion with us about your options. If your case must be prorated then you will be required to execute certain documents related to these statutes in order for us to disburse your settlement proceeds.

Lastly, Medicaid requests that its lien be paid out of your settlement funds within thirty (30) days of receipt of your settlement check.

What sources can Medicaid recover from?

Medicaid is entitled to reimbursement from any settlement you receive from any insurance company covering the at-fault party. If you have a workers’ compensation case and Medicaid paid for some of your treatment, then Medicaid is entitled to reimbursement from any payments made by the workers’ compensation insurance carrier.

Medicaid also has the right to receive reimbursement from all automobile policies which may provide coverage related to your case. This includes the right to receive repayment from your own medical payments coverage or any other applicable medical payments coverage. In addition, Medicaid has subrogation right to receive reimbursement from all applicable uninsured or underinsured polices which may cover your injuries.