Eleventh Circuit Adopts 4-year Statute of Limitations for Suits Under MSPA’s Private Cause of Action
The U.S. Court of Appeals for the Eleventh Circuit recently addressed the uncertainty surrounding the period of limitations when Medicare Advantage Organizations (MAOs) bring private causes of action under the MSPA. Medicare, a government actor, is subject to a 3-year statute of limitations under the Medicare Secondary Payer Act (MSPA). On the other hand, suits brought by MAOs are considered private causes of action which do not have a specified period of limitations.
In MSPA Claims 1, LLC v. Tower Hill Prime Ins. Co., 2022 U.S. App. LEXIS 22162(11th Cir. Aug. 10, 2022), the Eleventh Circuit was faced with the task of determining the appliable statute of limitations for suits brought under the private cause of action provision of the MSPA, as well as when the limitations period begins to run. There, an assignee of an MAO, MSPA Claims 1, sued Tower Hill, an insurance company, under the MSPA’s private cause of action to recover payments it made on behalf of enrollee D.L. Tower Hill had settled a liability claim with D.L. for $25,000 on June 22, 2012. MSPA Claims 1 discovered a possible claim against Tower Hill in June 2015 and issued a letter demanding reimbursement. When payment was not received, it filed suit on August 17, 2018.
The Eleventh Circuit looked to existing precedent and explained that MSPA Claims 1’s cause of action was made possible by the enactment of Medicare Part C in 1997, which granted MAOs the statutory right to charge a primary payer. Therefore, the applicable statute of limitations is four (4) years, pursuant to 28 U.S.C 1658(a).
The Court adopted the “occurrence rule” in determining the start date for the limitations period. Under the “occurrence rule”, the limitations period begins on the date that the violation of the plaintiff’s legal right occurred. Applying this rule to the facts of the case, the Court held that the statute of limitations for MSPA Claims 1’s cause of action began to run in 2012, when it paid an enrollee’s medical bills and became entitled to reimbursement through the MSPA., not when it learned about the claim and settlement in 2015. Because MSPA Claims 1’s cause of action accrued in 2012, more than four years before suit was filed 2018, its claim was untimely.
It will be interesting to see how the Eleventh Circuit’s ruling on the statue of limitations applicable to claims brought under the MSPA’s private cause of action influences other courts. We will continue to monitor the issue and keep you apprised of all developments.
