New York Cannot Extinguish Medicare Provider’s Subrogation Lien

In 2009, New York enacted legislation in an attempt to limit the ability of medical care payors to recover payments they made to or on behalf of injured individuals (the legislation did not limit any recovery of property damage payments). The legislation prevented companies that held contractual (as opposed to statutory) liens from bringing subrogation actions.  The law provides, in part:  “Except  where there is  a statutory right of reimbursement, no party entering into [] a settlement [of a personal injury or wrongful death action] shall be subject to a subrogation claim or claim for reimbursement by a benefit provider and a benefit provider shall have no lien or right of subrogation or reimbursement against any such settling party...” [1]    Payment of additional first party benefits was excluded from this statute. The legislation was backed by personal injury attorneys who wanted to prevent medical care providers from obtaining a piece of personal injury settlements and awards.  The law became effective November 12, 1999.

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Subrogating Under a “Bailment” Theory

A bailment is defined as a delivery of personalty for some particular purpose, or on mere deposit, upon a contract express or implied, that after the purpose has been fulfilled it will be redelivered to the person who delivered it, or otherwise dealt with according to that person’s directions or kept until it is reclaimed.[1] A bailment generally involves someone giving an item to someone else to hold. The most common example of a bailment is a parking garage, where you pay someone to hold your car for you. In determining whether a bailment exists, the courts will look at whether the owner of the item relinquished possession and control over it. [2]

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When is an Expert Report Privileged?

As I’ve noted before, New York state court rules are generally more “pro-plaintiff” than federal court. In New York state court, a subrogating carrier does not have to turn over its expert report to the defense unless there are “special circumstances.” In state court, the subrogating carrier only need provide a short summary of what its expert is expected to testify to, along with a recitation of the expert’s qualifications and experience.

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