MSP Recovery, LLC v. Allstate Ins. Co.
| Decision Date | 30 August 2016 |
| Docket Number | No. 15-12398, No. 15-14790,No. 15-14353, No. 15-14356, No. 15-14355, No. 15-12403, No. 15-12402,15-14353 |
| Citation | 835 F.3d 1351 |
| Parties | MSP Recovery, LLC, Plaintiff-Appellant, v. Allstate Insurance Company, Defendant-Appellee. MSP Recovery, LLC, Plaintiff-Appellant, v. Progressive Select Insurance Company, Defendant-Appellee. MSP Recovery, LLC, Plaintiff-Appellant, v. Progressive Select Insurance Company, Defendant-Appellee. MSP Recovery, LLC, Plaintiff-Appellant, v. Progressive Select Insurance Company, Defendant-Appellee. MSPA Claims 1, LLC, Plaintiff-Appellant, v. IDS Property Casualty Insurance Company, Defendant-Appellee. MSPA Claims 1, LLC, Plaintiff-Appellant, v. Infinity Auto Insurance Company, Defendant-Appellee. MSP Recovery, LLC, Plaintiff-Appellant, v. Allstate Insurance Company, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Eleventh Circuit |
Beverly A. Pohl, Broad & Cassel, Fort Lauderdale, FL, Frank Carlos Quesada, MSP Law Firm, John H. Ruiz, Law Offices of La Ley con John H. Ruiz, Miami, FL, for Plaintiff-Appellant (Case No. 15-14353).
Suzanne Labrit, Tampa, FL, Rachel M. LaMontagne, Miami, FL, Shutts & Bowen, LLP, for Defendant-Appellee (Case No. 15-14353).
Beverly A. Pohl, Broad & Cassel, Fort Lauderdale, FL, Brian Cournoyer, MSP Law Firm, Gustavo Javier Losa, John H. Ruiz, Law Offices of La Ley con John H. Ruiz, Miami, FL, for Plaintiff-Appellant (Case No. 15-12398).
Betsy Ellwanger Gallagher, Michael C. Clarke, Kubicki Draper, Tampa, FL, Erick Dwayne Martin, Grumer & Macaluso, PA, Fort Lauderdale, FL, Neil Vijay Singh, Law Offices of Neil V. Singh, Lauderdale
Lakes, FL, for Defendant-Appellee (Case Nos. 15-12398 and 15-12402).
Beverly A. Pohl, Broad & Cassel, Fort Lauderdale, FL, Brian Cournoyer, Frank Carlos Quesada, MSP Law Firm, Gustavo Javier Losa, Rebecca Rubin-del Rio, John H. Ruiz, Law Offices of La Ley con John H. Ruiz, Miami, FL, for Plaintiff-Appellant (Case No. 15-12402).
Beverly A. Pohl, Broad & Cassel, Fort Lauderdale, FL, Brian Cournoyer, MSP Law Firm, Gustavo Javier Losa, Christine M. Lugo, Gino Moreno, Rebecca Rubin-del Rio, John H. Ruiz, Law Offices of La Ley con John H. Ruiz, Miami, FL, for Plaintiff-Appellant (Case No. 15-12403).
Betsy Ellwanger Gallagher, Michael C. Clarke, Kubicki Draper, Tampa, FL, Erick Dwayne Martin, Grumer & Macaluso, PA, Fort Lauderdale, FL, for Defendant-Appellee (Case No. 15-12403).
Beverly A. Pohl, Broad & Cassel, Fort Lauderdale, FL, for Plaintiff-Appellant (Case No. 15-14355).
Nicole Tucker Melvani, Niels P. Murphy, Christen Elizabeth Luikart, Murphy & Anderson, PA, Jacksonville, FL, for Defendant-Appellee (Case No. 15-14355).
Beverly A. Pohl, Broad & Cassel, Fort Lauderdale, FL, Gustavo Javier Losa, John H. Ruiz, PA, John H. Ruiz, Law Offices of La Ley con John H. Ruiz, Miami, FL, for Plaintiff-Appellant (Case No. 15-14356).
Joshua D. Lerner, Jessica G. Lagos, Nicole Sieb Smith, Rumberger Kirk & Caldwell, PA, Miami, FL, for Defendant-Appellee (Case No. 15-14356).
Beverly A. Pohl, Broad & Cassel, Fort Lauderdale, FL, Frank Carlos Quesada, MSP Law Firm, Miami, FL, for Plaintiff-Appellant (Case No. 15-14790).
Suzanne Labrit, Shutts & Bowen, LLP, Tampa, FL, Rachel M. LaMontagne, Shutts & Bowen, LLP, Miami, FL, for Defendant-Appellee (Case No. 15-14790).
Before ED CARNES, Chief Judge, ANDERSON, Circuit Judge, and TITUS,* District Judge.
, Circuit Judge:
These seven consolidated1 cases present the question of whether a contractual obligation, without more (, without a judgment or settlement agreement from a separate proceeding), can satisfy the “demonstrated responsibility” requirement of the private cause of action provided for by the Medicare Secondary Payer Act (the “MSP Act”). 42 U.S.C. §§ 1395y(b)(2)(B)(ii)
, (b)(3)(A). We hold that it can.
In 1980, Congress passed the MSP Act to reduce the costs of Medicare. Glover v. Liggett Grp., Inc., 459 F.3d 1304, 1306 (11th Cir. 2006)
. Prior to the Act's passage, Medicare often acted as a primary insurer; that is, Medicare paid for enrollees' medical expenses, even when an enrollee carried other insurance that covered the same costs, or when a third party had an obligation to pay for them. The MSP Act, as its name suggests, changed that relationship so that Medicare acts as a secondary payer. “This means that if payment for covered services has been or is reasonably expected to be made by someone else, Medicare does not have to pay.” Cochran v. U.S. Health Care Fin. Admin., 291 F.3d 775, 777 (11th Cir. 2002)
. The MSP Act prohibits Medicare from paying for items or services if “payment has been made or can reasonably be expected to be made under a workmen's compensation law or plan of the United States or a State or under an automobile or liability insurance policy or plan (including a self-insured plan) or under no fault insurance.” 42 U.S.C. § 1395y(b)(2)(A)(ii). If, however, a primary payer—in the parlance of the statute, a “primary plan”—“has not made or cannot reasonably be expected to make payment with respect to the item or service promptly,” Medicare may make a payment on the enrollee's behalf, conditioned on reimbursement from the primary plan. Id.§ 1395y(b)(2)(B)(i) ; see also Cochran, 291 F.3d at 777 ().
We pause here to note that, though the MSP Act uses the term “primary plan” to describe entities with a primary responsibility to pay, that term covers more than just health insurance plans. The law defines a “primary plan” as “a group health plan or large group health plan, ... a workmen's compensation law or plan, an automobile or liability insurance policy or plan (including a self-insured plan) or no fault insurance....” 42 U.S.C. § 1395y(b)(2)(A)
.2 Thus, it is clear that the defendants in this case—which are all personal injury protection no-fault carriers—are primary plans within the meaning of the MSP Act.
The mechanics of the reimbursement process are set out in the statute as follows. The law requires a primary plan to reimburse Medicare “if it is demonstrated that such primary plan has or had a responsibility to make payment with respect to such item or service.” 42 U.S.C. § 1395y(b)(2)(B)(ii)
. The statute proceeds to explain how that responsibility may be demonstrated:
responsibility for such payment may be demonstrated by a judgment, a payment conditioned upon the recipient's compromise, waiver, or release (whether or not there is a determination or admission of liability) of payment for items or services included in a claim against the primary plan or the primary plan's insured, or by other means.
Id. This is the demonstrated responsibility requirement; in other words, Medicare may obtain reimbursement from a primary plan if it demonstrates that the primary plan “has or had a responsibility” to pay for the item or service. To facilitate recovery of these payments, the law provides for a right of action by the United States, for double damages, against “any or all entities that are or were required or responsible” to make payment under a primary plan. Id.§ 1395y(b)(2)(B)(iii)
.
In addition to the right of action by the United States, Congress created a private cause of action against a primary plan that fails to provide for primary payment. Id.§ 1395y(b)(3)(A). Like the cause of action provided to the United States, the private cause of action also permits the plaintiff to recover double damages. Id.3
A. Factual and Procedural History
The seven consolidated cases in this appeal all involve attempts by assignees of a health maintenance organization (“HMO”) to recover conditional payments via the MSP Act's private cause of action. The facts relevant to the issues raised on appeal are similar in each case. Plaintiffs MSP Recovery LLC (“MSP Recovery”) and MSPA Claims 1, LLC (“MSPA Claims 1”) are firms that obtain claims for reimbursement under the MSP Act from HMOs that offer Medicare Advantage Plans. Defendants are all insurance companies that provide personal injury protection (“PIP”) no-fault insurance to automobile owners and operators in Florida. In each case, a person covered by a defendant's PIP no-fault insurance policy was injured in an automobile accident. Each such insured was also enrolled in a Medicare Advantage Plan provided by Florida Healthcare Plus (“FHCP”), an HMO. FHCP made conditional payments on behalf of the injured persons to cover medical expenses in each accident. FHCP assigned its claims under the MSP Act, and Plaintiffs are the current assignees. Plaintiffs allege that, under the MSP Act, FHCP was a secondary payer, and Defendants were primary plans with obligations to pay some of their insureds' medical costs. Defendants' responsibility to pay, Plaintiffs assert in their complaints, is demonstrated by the insurance contracts the injured persons entered into with Defendants. Plaintiffs filed suit in the Southern District of Florida seeking double damages under 42 U.S.C. § 1395y(b)(3)(A)
.
All of the consolidated cases were dismissed. In each case, the district court relied on our opinion in Glover v. Liggett Group, Inc.
In a case in which the defendant was an alleged tortfeasor, Glove r held that a primary plan's responsibility to pay must be demonstrated before the plaintiff files a claim under the MSP Act. 459 F.3d at 1309. When the primary plan's responsibility to pay arises from tort liability, we held in Glover, liability might be demonstrated by a judgment or settlement, but the tortfeasor's liability cannot be “demonstrated” through the MSP Act claim itself. Id. In other words, a federal lawsuit under the MSP Act cannot serve as a substitute for determining liability via a standard tort claim; the tortfeasor's responsibility to pay must be independently established. The courts below held that the requirement we established in Glover —that a primary plan's...
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...(1998). If at any point a federal court discovers a lack of jurisdiction, it must dismiss the action. See MSP Recovery, LLC v. Allstate Ins. Co. , 835 F.3d 1351, 1357 (11th Cir. 2016).Unfortunately, the district court took its obligation to ensure its jurisdiction far too lightly. It dismis......
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