Why Arbitrary State Medicaid Formulas Fail the Wos Test

A 2013 Supreme Court decision sets a federal limit on every state Medicaid recovery from a personal injury settlement.

Download the Wos Compliance Guide
BLOG: Beyond Ahlborn. How Wos Protects Injury Victims from Arbitrary State Recovery.

Schedule a Free Medicaid Lien Consultation

The Problem with Default Medicaid Recovery Formulas

State Medicaid agencies and their recovery contractors, including Optum and Conduent, often rely on a statutory default to set the medical portion of a settlement. The state says one-third. Pay accordingly. 

Federal law does not allow it as a fixed rule. In Wos v. E.M.A., the Supreme Court held that a state cannot apply an arbitrary one-size-fits-all presumption to determine how much of a tort recovery is reimbursable. The injury victim has a property right in the rest of the settlement. That property right is protected by the federal anti-lien statute at 42 U.S.C. § 1396p. 

Without a procedure to challenge the state’s default, the lien can reach damages it has no right to touch. 

What You Will Learn from the White Paper

  • How Wos limits state Medicaid recovery to the medical portion of a settlement, even where the state statute says otherwise. 
  • Why arbitrary statutory caps like North Carolina’s one-third rule do not survive federal preemption. 
  • What a “fair and impartial adversarial procedure” means under the E.M.A. and Wos line of cases. 
  • A framework for identifying state allocation default rules and where they are vulnerable. 

Decades of Medicaid Lien Resolution Experience

Synergy is the industry leader in healthcare lien resolution for personal injury firms. The Synergy team includes attorneys and lien specialists who reduce state Medicaid liens across all fifty states using Ahlborn and Wos principles applied to each state’s third-party liability statute. Synergy resolves Medicaid liens at scale, drawing on hundreds of years of combined subrogation experience to protect injury victims’ net recoveries.

Free Resource: WOS Compliance White Paper

Get the federal framework, the case law, and the procedural posture in one desk reference. Download the State Medicaid Recovery After Wos Guide.

Have a Challenging Medicaid Lien?

If you have a difficult Medicaid lien where the state default formula does not work, send it over to Synergy.

TESTIMONIALS

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The Synergy team will work diligently to ensure your case gets the attention it deserves. Contact one of our legal experts and get a professional review of your case today.

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