Legal Memorandum: Priority of Medicare Reimbursement in PA

Issue: In Pennsylvania, what is the priority of reimbursement from Medicare versus another insurance carrier?

The federal statute that addresses the priority of Medicare reimbursement is 42 U.S.C. § 1395y(b)(2)(B).  The statute states, in relevant part, that any Medicare payment made is conditioned on reimbursement when payment has been or could be made under subparagraph (A).  Id.  Subparagraph (A)(ii) describes payments made under worker’s compensation law.  Id. § 1395y(b)(2)(A)(ii).

The section of the Code of Federal Regulations that addresses this issue is 42 C.F.R. § 411.24(e), which states that the Health Care Financing Administration (HCFA) 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 . . . .”  Id.

In Collins v. Allstate Indem. Co., 426 Pa. Super. 197, 626 A.2d 1162 (1993), aff’d sub nom Byrne v. Southeastern Pa. Transp. Auth., 541 Pa. 45, 660 A.2d 50 (1995), the court examined the priority of payments between Medicare and no-fault auto insurance.  The court held that the Omnibus Reconciliation Act made Medicare secondary or excess to no-fault benefits.  Id. at 203, 626 A.2d at 1165.  The statute also applies to worker’s compensation law.  See 42 U.S.C. §1395y (b)(1).        

In Myers v. Commercial Union Assur. Co., 319 Pa. Super. 21, 465 A.2d 1032 (1983),*FN1 Thomas Myers was injured in a car accident in Pennsylvania.  Id. at 24, 465 A.2d at 1034.  As a result of the accident, Myers sustained permanent injuries.  Id. at 25, […]