The PAID Act – Encourages Transparency Surrounding Medicare Beneficiaries


On December 11, 2020, President Trump signed into law the Provide Accurate Information Directly (PAID) Act. The Act was designed to eliminate bureaucratic constraints and decades-old regulations that frequently resulted in unwarranted lawsuits and great confusion regarding the Medicare Secondary Payer (MSP) statute.

The PAID Act Provides Access to Data Previously Overlooked

The Medicare Advantage and Part D (the Plans) are not required to pay for health claims if other parties are available to remunerate or are reasonably expected to pay them. When Medicare pays for a claim, it must submit a request for the recovery to the primary plan believed to be responsible for payment before taking any further measures, such as litigation. While insurers may reach out to the Plans, they are not under any new legal obligations to coordinate benefits or get in touch with the Plans.

In the past, both Medicare Advantage and Part D seldom pursued collections or secondary payer amounts from primary plans. However, this did not prevent the Plans from taking legal action against Medicare beneficiaries, their lawyers, and the parties paying compensation for repayment. The PAID Act enhances the sharing of information between parties to boost coordination and repayment of claims. Modernizing the MSP is expected to save taxpayers tens of millions of dollars and prevent excessive litigation.

How the PAID Act Benefits Personal Injury Law Firms

Historically, beneficiary information was difficult to obtain due to the absence of a central database and the Centers for Medicare & Medicaid Services (CMS), the federal agency responsible for the MSP program, failing to make the information readily available. Thus, there was no way for personal injury attorneys trying to resolve claims to know for certain which of the Plans had the right to assert recovery under the MSP Act for paid medical expenses.

The new law was designed to deal with transparency issues. The PAID Act, in response to a Section 111 query, requires the CMS to provide the respective Responsible Reporting Entity (RRE) with the plan number, name, and address of each Medicare Advantage and Medicare Prescription Drug Plan that a beneficiary was enrolled in during the preceding 3-year period before the inquiry. This allows RREs, such as liability and no-fault insurers, to proactively verify and coordinate with the Plans to satisfy outstanding reimbursement obligations.

Repayments are typically asserted for monetary compensation paid by the RRE to settle personal injury claims. Consequently, the PAID Act is regarded as a huge win for most stakeholders in auto, no-fault, and liability settlement communities. It should stem the flow of litigation that uses the MSP cause of action provision to recover double damages from self-insureds, insurance carriers, and law firms who may not have diligently verified or resolved their reimbursement obligations.

Get in Touch with Western New York’s Finest Personal Injury Lawyer

Jed Dietrich, Esq., acclaimed as an American Institute of Trial Lawyers Litigator of the Year, and his seasoned team of attorneys will do everything within our power to obtain the maximum compensation for your personal injury case. We are highly experienced at negotiating the reduction of Medicare liens and other obligations to provide clients with the highest possible compensation. The Dietrich Law Firm P.C.’s past clients have repeatedly proclaimed that Jed Dietrich, Esq. is the best personal injury lawyer. Please see our client testimonials and Google 5 Star rating and by clicking here. You have absolutely nothing to lose by hiring our elite law firm. We are available 24 hours per day and 7 days per week by filling out the online consultation form or calling 716-839-3939.

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