The U.S. Supreme Court ruled unanimously on May 15 that health plans can ask for reimbursement when another party pays for the cost of an injured plan member’s care.
The ruling means that health carriers can continue to use “acts of third parties” policy provisions, or “subrogation” provisions.
The provisions give a carrier the right to try to recover cash it pays for treatment of an injured plan member by sharing in the member’s lawsuit settlements or court awards.
America’s Health Insurance Plans, Washington, joined with the National Association of Manufacturers, Washington, and the American Benefits Council, Washington, to support the carrier involved in the case, Sereboff et ux. v. Mid Atlantic Medical Services Inc.
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“We’re gratified by the court decision,” AHIP spokeswoman Susan Pisano says. “This is a case that has to do with contract provisions in health care insurance that help keep health care affordable for consumers.”
The petitioners in the case, Dr. Joel Sereboff, a psychologist, and his wife, Marlene, were involved in an automobile collision in 2000. Mid Atlantic Medical, Bethesda, Md., spent about $75,000 on paying their collision-related medical bills. After the Sereboffs received a $750,000 lawsuit settlement, Mid Atlantic told the Sereboffs they had a legal obligation to reimburse the company.
The Sereboffs set $75,000 aside while opposing Mid Atlantic’s claim.
The Sereboffs argued that they should not have to reimburse Mid Atlantic Medical, which is now part of UnitedHealth Group Inc., Minnetonka, Minn., because the settlement was supposed to make them whole and was not necessarily supposed to be compensating them for past medical expenses.