The lawsuits were filed in U.S. District Courts in Kansas, Missouri, Tennessee and Texas within the past two weeks, court records show. Each of the complaints filed by Humana argues that Farmers entities used “deceptive practices” to “shift their financial obligations under the Medicare Secondary Payer law to Medicare Advantage organizations and ultimately to the Medicare Trust Funds and to elderly and disabled Medicare Advantage enrollees.”
The Medicare Secondary Payer Act requires self-insured employers, insurers and others to notify the Centers for Medicare and Medicaid Services of workers compensation and liability settlements or payments that involve Medicare recipients. CMS can use settlement funds to recoup “conditional payments” that it previously has made on behalf of beneficiaries to medical providers. It also can require insurers, employers and other “primary payers” to set aside funds to pay for future medical costs related to a beneficiary's injury.
Humana argues in the court filings that Farmers entities served as primary payers, and that Humana and its entities are secondary payers because they acted on behalf of CMS as a Medicare Advantage plan. Therefore, Humana contends that Farmers companies are required to reimburse Humana under the Medicare Secondary Payer Act.
“Plaintiff, Humana Health Plan, has charged Defendant, Farmers Insurance Company, for those services, but Defendant, Farmers Insurance Company, has refused to make appropriate reimbursement to Plaintiff, Humana Health Plan,” according to Humana's complaint filed in Missouri on Monday.