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Sixth Circuit Remands Case to District Court for Further Consideration Regarding Standing

Duncan v. Liberty Mutual Insurance Company, arises following a motor vehicle accident the late David Duncan was involved in on January 11, 2013. At the relevant time, Duncan was a Medicare beneficiary, and Liberty Mutual was Duncan’s automobile no-fault insurer. Following the accident, Duncan brought a claim against Liberty Mutual for payment of his medical bills. When Duncan died in 2014, his estate continued to pursue the claim and, eventually, filed an action in Michigan state court. The Estate received a verdict determining that Duncan’s injuries arose from the motor vehicle accident and, therefore, Liberty Mutual was responsible for payment of his medical expenses.

Following the state-court verdict, Liberty Mutual notified CMS that it had been determined

to be the primary payer related to the accident, and CMS identified $174,815.20, in conditional payment claims paid on behalf of Duncan. The Estate then amended its complaint to include a claim for double damages under the Medicare Secondary Payer Act, based on Liberty Mutual’s failure to pay the claims. Liberty Mutual removed the action to the United States District Court for the Eastern District of Michigan, where it filed a motion for summary judgment, arguing that the Estate lacked standing to bring a claim under the MSPA. The motion was granted, and the Estate appealed the matter to the Sixth Circuit.

The Sixth Circuit explained that, to show standing, the Estate must show that Duncan suffered an injury-in-fact and that the injury was “concrete and particularized” and “actual or imminent, not conjectural or hypothetical.” This, as the court pointed out, is a fact intensive question. Quoting its previous decision in Gucwa, the court noted that standing cannot be established “simply by showing that the insurer failed to make payments ‘on [his] behalf’; the plaintiff must show that he ‘[him]self suffered an injury because a primary plan has failed’ to pay.” Whether Duncan suffered financially or in some other way due to Liberty Mutual’s failure to pay medical expenses, triggering Medicare’s conditional payments, is a question for the finder of fact. In its opinion, the Sixth Circuit found that the district court failed to analyze whether the factual standard for standing was met. As such, the Sixth Circuit remanded the matter to the district court for further findings of fact regarding whether the Estate has standing to bring a claim under the MSPA.

As always, we will keep you apprised of future developments.

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