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11th Circuit Tosses Law Firm's Claim, With Medicare Tutorial

Judge Amul Thapar testifies before the Senate Judiciary Committee during his confirmation hearing to be U.S. Circuit Judge for the Sixth Circuit, on April 26, 2017. Photo: Diego M. Radzinschi/ALM

In throwing out a Florida Medicare Secondary Payer Act claim, the U.S. Court of Appeals for the Eleventh Circuit offered a tutorial on the federal health care plan for seniors.

Judge Amul Thapar from the Sixth Circuit, substituting, wrote the opinion with this promising start, borrowing a phrase from The Federalist No. 62.

“The Medicare statute is almost ‘so incoherent it cannot be understood,’” Thapar said. “Luckily though, we need not venture very far into its tangled web here. The Medicare provision at issue in this case is clear and clearly bars the plaintiff’s claim. Accordingly, we affirm.”

Still, Thapar—joined by Judges Marcus Wilson and Jill Pryor—determined that “a short statutory background will still make the journey easier.” Thus, he took 18 pages to explain the workings of the Medicare Secondary Payer Act and the Medicare Advantage Program.

Ultimately, the panel upheld U.S. District Judge Kathleen Williams of the Southern District of Florida and dismissed the appeal from MSPA Claims 1, a law firm that seeks to recover payments for Medicare Advantage Organizations, called "MAOs."

“MAOs, like Medicare, can sue primary plans to ensure they are properly reimbursed,” Thapar said. “But unlike Medicare, MAOs must rely on the private cause of action when they sue. They cannot use the separate government cause of action.”

The case started with Florida Healthcare Plus, an MAO that assigned a claim to La Ley Recovery Systems, which in turn assigned those claims to MSPA. A hospital had billed both the primary and secondary payer. Both paid. The hospital then reimbursed the secondary payer, Florida Healthcare, standing in the shoes of Medicare.

The amount of money in dispute was interest on a seven-month delay in a payment of $286.

But the number of lawyers on the docket suggest a bigger issue was at stake.

The legal team for MSPA Claims 1 includes five lawyers from Rivero Mestre in Miami as well as three from MSP Recovery Law Firm in Miami.

Tenet and St. Mary’s Medical Center were represented by Alan Lash of Lash & Goldberg, along with David Ruffner, Erica Rutner and Greg Weintraub from his firm.

The lawyers did not immediately respond to a request for comment.

“Although MSPA has standing, its claim still must be plausible on the merits to survive dismissal. The MSP Act’s private cause of action is only available ‘in the case of a primary plan which fails to provide for primary payment (or appropriate reimbursement)’,” Thapar said. “Yet MSPA has not sued a primary plan; it has sued two medical services providers. Since private MSP Act plaintiffs can only sue primary plans, and MSPA has not done so, its claim is not plausible on its face.’”

Thapar said MSPA “attempts to avoid the clear textual bar to its lawsuit by grasping at other provisions of the statute and agency regulations interpreting it.” But, he added, “these attempts at avoidance all fail.”

“The private cause of action only permits MSPA to sue primary plans,” Thapar concluded. “Neither of the defendants here are primary plans, so MSPA’s claim must be dismissed.”

The case is MSPA Claims 1 v. Tenet Florida .