HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Friday, February 24, 2006

New Medicaid Case in the Supreme Court

It will be argued on Feb. 27, and Cornell's LII has a fabulous preview of the case today.  Click here for the full Monty.  Meanwhile, if you want the short version, here's an excerpt:

Ark. Dep’t of Human Servs. v. Ahlborn (04-1506)
Court appealed from: United States Court of Appeals for the Eighth Circuit (Feb. 9, 2005)

Oral argument date: Feb. 27, 2006

Medicaid provides certain needy individuals with funds for medical treatment. The program is administered by the states with federal funding and statutory guidelines. Federal Medicaid law generally forbids states from placing liens on the “pre-death” property of Medicaid beneficiaries. The Arkansas Medicaid program requires beneficiaries to sign over their interest in any future legal claim before receiving benefits. Technically, this case will decide whether the federal statutes prohibit states from doing this. More importantly, the decision will determine to what extent states can recoup Medicare expenses from private tort judgments and settlements, and could have a profound effect on how the costs of the Medicaid are distributed between the states and private parties.

Question(s) Presented
Do federal Medicaid statutes limit the amount a state can recover in reimbursement from a third-party payment to the portion earmarked for medical treatment?

If a party receives Medicaid benefits for an injury, and later receives a settlement payment from a third party, can the state force the party to use the entire settlement to repay the state’s Medicaid expenses?

LII does a fine job summarizing the case, though the summary does end with a thud: "In this case, the Court will be forced to choose to protect either the assets of poor injury victims or the states. On the one hand, a decision for Ahlborn would ensure that injury victims are properly compensated for lost wages. On the other hand, a victory for the states would ensure that victims don’t improperly structure injury settlements. What is clear, is that one side will end up with less money."  Thanks for that, guys.  [tm]

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