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Medicare Compliance

As Medicare has become an increasingly important part of defense litigation, Marshall Dennehey has remained at the forefront of this emerging area of law since the Center for Medicare Services implemented its regulations in 2001. While our Medicare work began as a supplement to the workers’ compensation practice, it has rapidly expanded and is a necessity for all areas of defense litigation.

As such, we have formed a stand-alone practice group dedicated to Medicare compliance matters. Our boutique practice group provides accurate assessments and continuity of service. Cases are handled from start to finish by the same attorney, providing a single point of contact for information and advice throughout the pendency of the case.

Our Medicare team has the comprehensive knowledge necessary to effectively handle set-asides in all parts of the country. We are well-versed in federal and state liability systems, as well as the workers’ compensation systems. In addition to protecting Medicare’s interests through set-asides, we also alert our clients to the involvement of the State Children’s Health Insurance Program (SCHIP) Reporting Law. We offer cogent advice regarding case settlements, including the use of structured settlements and other strategies to bring cases to conclusion. We are willing and able to work with lawyers throughout the country to provide the support they need regarding Medicare issues.

National Medicare Services Provided:

  • Medicare set-aside allocations for workers’ compensation and liability cases.
  • Conditional payment searches.
  • Submissions to Medicare for set aside approval.
  • Consultations regarding Medicare issues.
  • Attendance at mediations, along with your defense counsel, to effectively settle cases.
  • Preparing Medicare language for settlement documents.
  • Expedited services.

Not only do we have the requisite knowledge and experience to address any Medicare related need, we also provide these services on a cost-effective basis. The members of our Medicare Compliance Practice Group are available to help you find the right strategy to achieve your goals.

Results

Thought Leadership

Beware of the Language Used in Your Settlement Agreements: Medicare Is Watching

October 2, 2023

The workers’ compensation practitioner has now become a forced bedfellow of CMS, like it or not. If you fail to “issue spot” in relevant settlements, you will have problems.

What's Hot in Workers' Comp

What’s Hot in Workers’ Comp – Special PA Alert

June 10, 2022

The Supreme Court of the United States issued a decision affirming Medicaid’s right to seek reimbursement from a settlement amount allocated for past and future medical care. In Gallardo v. Marstiller, Gallardo suffered catastrophic injuries, resulting in permanent disability, when a truck struck her while exiting a school bus. Florida’s Medicaid agency paid initial medical expenses and continues to pay medical expenses related to this accident. Gallardo sued the owner and driver of the truck and the county school board. The litigation resulted in a settlement for $800,000.00, with $35,367.52 being allocated to past medical expenses. The settlement failed to allocate any amount for future medical expenses. The Medicaid Act requires participating states to pay for needy individuals’ medical costs and then make reasonable efforts to recoup those costs from liable third parties. Florida’s Medicaid Third Party Liability Act automatically assigned to the state agency any right to third-party payments for “medical care.” This Florida statute allowed the agency to a portion of the tort recovery that is presumptively for “past and future medical expenses.” Gallardo challenged the presumptive allocation and brought a law suit arguing that Florida was violating the Medicaid Act by trying to recover portions of the settlement compensating her for future medical expenses. The Eleventh Circuit concluded that a state is not prevented by the Medicaid Act from seeking such reimbursement. The Court agreed, noting that nothing in the Medicaid Act or lien provision limits such a mode of relief. This decision reinforces perhaps a forgotten point to ponder in any workers’ compensation settlement. While a major focus has been on considering Medicare’s interests when a settlement involves future medical care, do not lose sight of Medicaid’s potential lien in your settlement analyses.

Firm Highlights

Result

No-Cause Jury Verdict Secured in Wrongful Death Trial

We successfully obtained a no-cause jury verdict in a 13-day wrongful death trial. The decedent, a 59-year-old man, was admitted to the emergency room on February 15, 2019, with complaints of abdominal pain, decreased appetite, and constipation, despite the use of laxatives. The patient did not complain of any nausea, vomiting, or diarrhea. He had a significant medical history including diabetes, hypertension, prior coronary artery stenting, morbid obesity (with past gastric bypass surgery), longstanding ventral hernia, and back pain. A CT scan revealed multiple hernias and a potential closed-loop bowel obstruction, leading to a surgery consultation. Our client, an emergency general surgeon, interpreted that the patient did not have a closed loop or any significant obstruction and recommended non-surgical management. The patient was approved to have clear liquids, and had a vomiting incident shortly after, but our client was not notified. The patient was returned to NPO status, and after improving overnight, he was returned to “clears” and additional medical and renal consults were ordered. Our client did not receive any communications from the residents/nurses of any changes in the patient’s condition. On February 18, 2019, two rapid responses were called due to increased heart rate and vomiting. It is believed that the vomiting resulted in aspiration, causing sepsis, ultimately leading to the patient’s death. During the trial, the plaintiff’s sole medical expert highlighted imaging on the wrong hernia, which called into question all of his opinions in the case. We made key objections related to the expert testimony, limiting what the allegations were, and preventing new allegations from being made. After approximately two and a half hours of deliberating, the jury returned a no-cause verdict. 

Thought Leadership

PA Middle District Dismisses Claims Against School District and its Superintendent, Principal, Special Education Director, and Classroom Teacher

A five-year-old special education student was enrolled in the Wyoming Valley West School District and attended the State Street Elementary School during the 2024-2025 school year. The student refused to clean up classroom toys at dismissal. When his teacher allegedly grabbed him by the wrist to walk him back to his seat, the student dropped to the floor and began crying. The teacher then allegedly grabbed the student by the ankle and dragged him across the floor. Following an investigation, criminal charges were not advanced by the county DA, and the school permitted the teacher to return to the classroom. The student’s parents sued, lodging thirteen legal counts under both state and federal law, which sought monetary damages from the teacher, the school district, the superintendent, the principal, and the director of special education. The plaintiff’s 42 USC 1983 claims were dismissed as to the school district for failure to allege a policy or custom violation, and the failure to alleged deliberate indifference in the failure-to-train context. As to the superintendent, building principal, and special education director, the Section 1983 claims were also dismissed for failure to allege personal involvement on the part of the individuals. Regarding an equal protection claim asserted against all defendants, the motion to dismiss was also granted for a failure to advance a plausible equal protection claim, holding that “plaintiffs' single-act allegations do not include a factual basis to even infer that the act was motivated by discriminatory animus rather than some other non-discriminatory impulse.” The court further dismissed the plaintiff’s negligence-based claims including negligence against the teacher and district administrators, NIED, and vicarious liability under the Political Subdivision Tort Claims Act (PSTCA). The federal claims under the IDEA, Section 504, and the ADA were also dismissed in various respects. The IDEA claim was dismissed against all defendants with prejudice for failure to exhaust administrative remedies. The Section 504 claims against the individual defendants were also dismissed with prejudice, as districts, not individuals, are the recipients of federal funds under Section 504. However, the Section 504 and ADA claims were dismissed without prejudice as to defendant Wyoming Valley West, and the plaintiff was permitted leave to amend.

Thought Leadership

U.S. Supreme Court Decides Key Issue Regarding Interstate Freight Broker Liability

Freight brokers are intermediaries.  They connect shippers of goods with trucking companies that transport those goods.  Freight brokers match a load of freight with a trucking company and oversee the logistics of the transportation. For a number of years there has been a division among the Federal Circuits regarding the potential liability of freight brokers when the trucking companies that they retain for interstate loads are involved in accidents.  At the center of this division was the Federal Aviation Administration Authorization Act of 1994 (FAAAA).  Some Federal Circuit Courts have held that state law negligent hiring claims against freight brokers were preempted by the FAAAA .  Other Federal Circuits Courts have held that even if preemption applied, the “safety exception” in the FAAAA saved state law negligent hiring claims from federal preemption.  On May 14, 2026, the U.S. Supreme Court addressed the conflict in Montgomery v. Caribe Transport II, LLC, et al, No24-1238. In that case freight broker C.H. Robinson selected Caribe Transport to haul an interstate load. The commercial truck driver employed by Caribe Transport allegedly caused an accident and the plaintiff, Montgomery, was seriously injured. Montgomery brought an action against the driver, Caribe Transport and C.H. Robinson. The allegation against C.H. Robinson was that it negligently retained Caribe Transport when it knew, or should have known, that it was an unsafe company. The Seventh Circuit Court of Appeals held that Montgomery’s claims against C.H. Robinson were preempted by the FAAAA. The plaintiff appealed to the U.S. Supreme Court.  The U.S. Supreme Court’s decision focused primarily on the safety exception in the FAAAA.  That provision provides that the FAAAA preemption “…shall not restrict the safety regulatory authority of a State with respect to motor vehicles.” C.H. Robinson argued, as freight brokers historically have, that their function was not “with respect to motor vehicles” because they do not own trucks or employ drivers. They are merely intermediaries, connecting entities who need freight moved with entities who can do that job. Therefore, C.H. Robinson argued that preemption applied, not the safety exception. The U.S. Supreme Court did not accept that argument. The Court focused on the meaning of the phrase “with respect to” in the safety exception. The Court held that it means “referring to”, “concerning” or “regarding”. Therefore, writing for a unanimous Court, Justice Barrett concluded that “[r]equiring C.H. Robinson to exercise ordinary care in selecting a carrier therefore “concerns” motor vehicles—most obviously, the trucks that will transport the goods. So, Montgomery’s negligent-hiring claim falls within the FAAAA’s safety exception, which saves it from preemption.” Justice Kavanaugh, in his concurring opinion, noted the effect this ruling may have on freight brokers and their insurers throughout the country: Importantly, the Court's decision today should not be read to mean that brokers will routinely be subject to state tort liability in the wake of truck accidents. As even plaintiff's counsel stressed, brokers should be able to successfully defend against state tort suits if the brokers have acted reasonably and arranged transportation with reputable trucking companies. Tr. of Oral Arg. 27-29. In plaintiff's counsel's words, the brokers "just have to hire carriers that actually have a reasonable policy," and "the broker is not going to have a problem if it's asking the hard questions of the carrier." Id., at 42, 45. In addition, the proximate-cause requirement in typical state tort law should help protect brokers from excessive liability. Id., at 25. That said, the brokers rightly caution against naivete. In the real world, as the brokers forcefully respond, state tort law can be unpredictable, and the costs to brokers of litigation and insurance may be significant even when brokers prevail in lawsuits. Moreover, the costs of litigation and insurance, as well as the costs of brokers' conducting more substantial inquiries into trucking companies, will cascade through the economy and be paid in part by American consumers in the form of higher prices. The concerns expressed by the brokers are legitimate and weighty. The key point here is that freight brokers can no longer claim they are protected from negligent retention claims by the FAAAA (in cases involving interstate transportation). The challenge will be to determine what is considered ”reasonable efforts” used by brokers when retaining transportation companies.