top of page

Court Awards Double-Damages to Medicare Advantage Organization

The plaintiff in this matter, Aetna Life Insurance Company (“Aetna”) is a Medicare Advantage Organization (“MAO”). Aetna filed suit seeking reimbursement under the Medicare Secondary Payer Act (“MSPA”) for payments made on behalf of defendant Nellina Guerrera for medical care payed on her behalf after a slip-and-fall at defendant Big Y Foods (“Big Y”). Aetna Life Ins. Co. v. Guerrera, 2020 U.S. Dist. LEXIS 139949, U.S. Dist. Conn. August 5, 2020.

Following the slip-and-fall, Guerrera filed a personal injury action against Big Y and received a settlement. Aetna issued notice that it would be asserting a lien against any recovery or settlement before the settlement agreement was finalized. Big Y allegedly agreed that it would withhold a portion of the settlement funds to reimburse Aetna’s lien. However, in the end, Big Y released the full settlement amount to Guerrera. Neither Guerrera, Big Y, nor Guerrera’s attorneys reimbursed Aetna.

To recoup its conditional payments, Aetna filed suit against Big Y, Guerrera, and Guerrera’s attorneys (collectively “Defendants”) for reimbursement. Ultimately, Aetna asserted its claim under the MSPA against Big Y only, arguing that, as the tortfeasor, Big Y is a primary payer under the MSPA. The court agreed and moved on to Aetna’s request for double damages under the MSPA’s Private Cause of Action. The court held that Aetna was entitled to double damages for Big Y’s failure to reimburse conditional payments and entered judgment in Aetna’s favor awarding the same.

The court allowed Aetna to proceed with a breach of contract claim against Guerrera in addition to its MSPA claim against Big Y. The court did, however, dismiss Aetna’s breach of contract claim against Guerrera’s attorneys. Finally, the court held that no defendant had a fiduciary relationship with Aeta and, as such owed Aetna no fiduciary duty.

In this case, even though Guerrera received the full amount of settlement funds from Big Y, the court allowed Aetna to recover double damages against Big Y. Medicare and Medicare Advantage Organizations are not bound by the provisions of state settlement documents and can seek reimbursement from any party to a settlement. As such, we strongly recommend that a plan for reimbursement of both Medicare liens and claims of Medicare Advantage Organizations be established as part of settlement.

We can help you research and resolve any liens asserted by Medicare or a claimant’s Medicare Advantage or Prescription Drug Plan. Please contact us with any questions!


Recent Posts
bottom of page