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Attorney fees can't come out of Medicare set-aside funds: Court


Medicare set-aside accounts can’t be used to pay attorney fees associated with such arrangements, a Louisiana appellate court ruled.

In Brian J. Benoit vs. MMR Group Inc. et al., Mr. Benoit was injured in 2004 while working for MMR, a Baton Rouge, La.-based construction firm, court records show. Mr. Benoit was paid temporary total disability workers comp benefits from 2004 to 2011, and settled the indemnity portion of his claim in 2012 for $30,000.

The parties later agreed to settle the medical portion of Mr. Benoit’s comp claim for $50,846, which was approved by the Centers for Medicare and Medicaid Services, court records show. The parties agreed to place the funds into a Medicare set-aside account.

The Medicare Secondary Payer Act requires self-insured employers and insurers to act as primary payers for workers comp and liability claims involving Medicare beneficiaries. The Centers for Medicare and Medicaid Services advises workers comp payers to set up Medicare set-aside accounts to pay for future medical costs for a beneficiary’s injury.

Mr. Benoit’s attorneys filed a motion in October 2012 to collect $2,480 in attorney fees from Mr. Benoit’s set-aside account, records show. The request was denied by the Louisiana Office of Workers’ Compensation, saying that the “set, calculated, dollar amount” in Mr. Benoit’s Medicare set-aside was designated only for his medical expenses.

A three-judge panel of the Louisiana Court of Appeal unanimously affirmed the workers comp office ruling on Wednesday. In its ruling, the appellate court agreed that the money in Mr. Benoit’s set-aside account could not be used for attorney fees.

“The provisions of the (set-aside) agreement are clear, unambiguous, and plainly state that the funds in the account can only be used for the payment of medical services related to Mr. Benoit’s work injury that would normally be paid by Medicare,” the ruling reads. “Because there is no ambiguity in the agreement language, its words should be given effect.”