So what does happen when someone gets hurt or killed by a drunk driver in North Carolina?

First, let me make this clear: Nichols Law Firm only represents people injured or killed by drunk drivers. We never defend drunk drivers. When I teach a class to lawyers who defend drunk drivers, I’m teaching them the best ways to help my injured clients, which sometimes can be mutually beneficial to their client.

When a North Carolina drunk driver wrecks your car and injures you or your loved ones, we all hope that they are arrested at the scene. The arresting officer will do field sobriety tests, and if the driver does poorly on the tests, there will be probable cause to request a breath test for blood alcohol concentration. The drunk driver can refuse that test but the arresting officer can force a blood draw to get the results. Any blood alcohol concentration over .08% will result in an arrest for driving while intoxicated. Some refer to that simply as DWI or DUI.

Is a personal injury claim against a drunk driver any different from a regular personal injury claim?

A personal injury case against a drunk driver is pretty similar to one against a non-drunk driver. An adjuster from the drunk driver’s insurance company will want to take a recorded statement from you over the phone. They may ask you about all the ways you think the driver was intoxicated. It’s really important to get that right and make sure that you tell them all the signs of intoxication you saw: glassy eyes, smell of alcohol, unsteady on feet, slurring words, and of course, any statements the other driver made about drinking.

So what are punitive damages in drunk driving cases?

In North Carolina, under General Statute Chapter 1D, Punitive Damages, anyone hurt or killed by a drunk driver, who proves the driver was drunk and driving negligently, may be entitled to receive punitive damages on top of the compensatory damages present in every injury case. Compensatory damages are things like medical bills, lost wages, pain and suffering, permanent scars, lost work, ambulance and doctor bills, and permanent disability. Punitives damages are damages on top of the compensatory damages and are meant solely to punish the drunk driver and deter other people from drunk driving.

§ 1D-1. Purpose of punitive damages.

Punitive damages may be awarded, in an appropriate case and subject to the provisions of this Chapter, to punish a defendant for egregiously wrongful acts and to deter the defendant and others from committing similar wrongful acts. (1995, c. 514, s. 1.)

In general, punitive damages are limited to 3 times the amount of the compensatory damages, or $250,000, whichever is greater. But the Legislature made an exception to the cap on punitive damages in North Carolina: drunk drivers.

§ 1D-26. Driving while impaired; exemption from cap.

G.S. 1D-25(b) shall not apply to a claim for punitive damages for injury or harm arising from a defendant’s operation of a motor vehicle if the actions of the defendant in operating the motor vehicle would give rise to an offense of driving while impaired under G.S. 20-138.1, 20-138.2, or 20-138.5. (1995, c. 514, s. 1.)

Do I need a lawyer to represent me when I have been hit by a drunk driver?

If you or a loved one gets hit by a drunk driver in Raleigh, Durham, or Chapel Hill, it is a good idea to at least have a free consultation with a lawyer. There are many reasons for this. First, you may be required to come to court as a witness in the drunk driving prosecution. Or you may be called on to give a victim impact statement at the drunk driver’s sentencing hearing. While the local District Attorney offices do a great job with victims, they can’t “represent you” or give you legal advice. Having your own lawyer, right from the start, means that I can come to the criminal court trial with you and help you through out. It also means that I will monitor the criminal case, and make sure the drunk driver receives appropriate punishment.

How does my lawyer help when I’m called as a witness or victim of a drunk driver?

Along the same lines, the criminal defense attorney can sometimes coordinate with me, as your attorney, to be very helpful to the injured party by facilitating money settlements with the injured party as part of criminal restitution or civil settlement. Sometimes the drunk driver’s lawyer will also coordinate with me to make sure that the insurance company for the drunk driver is paying a fair amount of money, considering the compensatory and punitive damages.

What experience does Nichols Law Firm and Chris Nichols, Attorney have making claims against drunk drivers?

I’ve been practicing law for 25 years and my first few years I actually defended drunk drivers when I worked for a senior attorney. This gave me great practical insight into how the criminal prosecution works. As a civil lawyer, I also have to prove the defendant was intoxicated, and having worked on both sides of this, I have a lot of knowledge. At any given time, my office usually has 4 or 5 cases against drunk drivers. Because of this, we have developed systems to catch drunk drivers in any lies or exaggerations they make about their alcohol use and rehabilitation. It’s not unusual for a criminal defendant to testify they have “put down the bottle”, only to have our private investigator see them buy booze at the ABC store and drive away on a limited permit that does not allow for that. When we catch defendants in lies like this, the cases against them often settle for more money and faster. Rarely do we have to try one of the civil cases against drunk drivers.

If you or a loved one has been hurt or killed by a drunk driver, you can call me, Chris Nichols, directly, for a free consultation: 919.915.0212

Be safe out there!

Chris Nichols
Nichols Law Firm

In NC you have three years to settle or file a lawsuit for personal injury (but not death, that’s two years)

In North Carolina you have three years to either settle a personal injury case or file a lawsuit. I did not say “file a claim.” I did not say “talk with an insurance adjuster”. I did not say “be in the middle of negotiations.”

On the third anniversary of your car wreck, you either need to have a settlement worked out, in writing and agree upon by the insurance adjuster and you, or you need to file an actual lawsuit in a court of law in NC.

If you are still negotiating with that adjuster at midnight on the third anniversary of your car wreck, you can never get anything for your claim. The next minutes that adjuster will say “Sorry, your statute of limitations ran, you have no claim.” And so you ask, “Wouldn’t the insurance company tell me that my time is running out?” The answer is NO. In fact, I’ve seen situations where the insurance adjusters actively seek to delay the settlement.

The wrongful death statute in North Carolina has a two year statute of limitations

If the car wreck resulted in a death, or wrongful death in North Carolina, the time limit is TWO YEARS. Also, to sue for the wrongful death of a loved one, there must be an Estate set up in the name of the deceased and an Administrator or Executor must actually be the party that sues. Cases like that look like this:

The Estate of John Doe, Susan Doe, Administrator V. Big Truck Company, LLC 

Setting up an Estate takes time. And even though there may be one type of Estate set up, it might not be the right type to bring a wrongful death claim.

I think I get this statute stuff, do I have to have a lawyer?

Not every case needs a lawyer. Really, a lawyer just told you that. I talk to a lot of people on the phone, give them a few pointers and send them on their way. It’s sometimes a good idea to settle your own case when it is simple and small. But complicated cases probably need lawyers. So it’s always a good idea to call a lawyer like me, and ask.

But really, if you call me on the day that your statute of limitations is about to run out, there is a 95% chance that I will not be able to save you and your case. Lawyers can not send an email to the court to file a lawsuit. It sometimes takes days to draft the paperwork. We have to find the Defendant and make sure we can serve them with papers. We need to see police reports. This takes time.

In law we frequently abbreviate Statute of Limitation as SOL. And if you miss one, you are SOL on your SOL. 

When is the latest you should call a lawyer for a personal injury case?

I would say that the latest that I would get in touch would be six months before the statute runs out. Put another way, two and half years after the accident for personal injury and one and a half years for wrongful death. That gives the lawyer time to gather your medical records, talk to experts, file the lawsuit, and get it served on the defendant. You see, even though the insurance company pays the claim, the other driver is the one who gets named in the lawsuit. So it’s not as easy as my office sending a letter to State Farm. We actually have to send the Sheriff or a certified letter to someone so they can be “served.”

If you waited past two and half years, you should still call for advice. Just know that a lot of lawyers don’t like taking cases that close to the statute of limitations.

What about children or kids? How long do minors have to settle their personal injury claims or file a lawsuit?

In NC, a minor is anyone under age 18. Minor’s statute of limitations work differently than adults. A minor’s statute does not BEGIN to run until they are age 18. Then it runs the normal 3 years for personal injury. Crazy, right? So if you are in a car accident at age 2, you will have until your 21st birthday to settle the claim or file a lawsuit! This is also true for other injury claims, like sexual abuse.

But there is a catch…. (there is always a catch, right?). The catch is this: In North Carolina, the medical bills for an injured minor (anyone under age 18) “belong” to the mom, dad, or legal guardian of the minor. What does that mean? It means that because a minor can’t sign a contract, when a minor goes to the hospital or doctor and has a bill for services, that bill is actually the parent or guardian’s bill. Don’t pay it? The parent or guardian gets sued by the hospital, not the minor.

So what’s the catch? Well, the catch is this- in the example above where the two year old gets hurt in a car wreck, let’s assume the medical bills are $50,000. Three years from the date of the wreck, the parent/guardian’s statute of limitations to sue for those medical bills expires. So on 3 years +1 day, the minor can still sue for pain and suffering and other economic wages, but NOT for past medical expenses.

But, there is a catch to the catch! There is a way for the parents to assign the claim for medical bills to the minor child so that those medical bills become part of the claim for the minor that does not run out until age 21. This can be tricky and I recommend lawyer supervision to deal with this. The good news is that it can be done quickly, so if you are reading this on the 2 year 364th day of the anniversary of an injury to a minor, it might not be too late to fix that problem. Call me!

Heartbreaker

I spoke to someone today who told me that the adjuster was discussing her case with her one day before her three year statute of limitations. She even asked if that was going to be a problem and the adjuster said “you have an open file claim.” That made the person feel good, even though it was a meaningless phrase.

When she called the day after the 3 year anniversary of her accident, the adjuster said “sorry, you didn’t file a lawsuit in time, you have no claim.”

No, she can’t sue him for that. Adjusters work for the driver that hit you! Their job is to pay you the least amount of money possible. That’s what they get paid to do. Not all of them are this heartless, some would warn you to get a lawyer or file a law suit. A lot of them are very good people. But consumers don’t really have the information or ability to decide who is who.

I had to tell this fine person that she no longer had a claim. It was a heartbreaker.

So if you’ve been waiting, even if you are still being treated for injuries, please call me or another lawyer and just get some advice (free and over the phone) on your time limits and whether you even need a lawyer. I’ve been doing this (looks at watch) for 23 years now, so I’ve probably handled a case like yours before. Let’s talk.

Chris Nichols, Attorney
800-906-5984

If you settled a case (by minor settlement, signed release, or Industrial Commission approval) in which Medicaid claimed a lien, between October 1, 2017 and February 9, 2018, you have 30 days from February 9 to file a motion in Superior or District court to seek a reduction of the lien under NCGS 108A-57. 30 days runs on the weekend of March 10-11, so calendar that for Friday March 9, 2018(unless you want to play chicken with the weekend rule). Example: You settled a claim on October 15, 2017 that had a Medicaid lien that exceeded 1/3 of the settlement. You paid Medicaid 1/3 of their lien (or held the money) because there was no longer a statutory mechanism to reduce the lien. You now have until March 9, 2018 to file a motion to reduce Medicaid’s lien.

Let’s define “settled” since that is the event that triggers the 30 day time limit to file the motion. Medicaid defines “settled” as:

1. The date upon which all parties execute a full Release of Claims; or,
2. For a minor, the date upon which the settlement is approved in a minor settlement hearing; or,
3. For a case in litigation that is tried, the date upon which Judgment is entered, or,
4. For a Workers Compensation case, the date upon which the Clincher is approved.

In addition to cases “Settled” during the period of October 1, 2017 and February 9, 2018, if you had a claim that settled up to 29 days before October 1, 2017, you may still have time to file for the lien reduction. I can’t tell you if you get only the remaining time you had left as of October 1, 2017, or if you get until March 9, 2018. Play it safe and choose the shorter time and file. Example: You settled a claim on September 15, 2017. Your 30 day window to file a motion for reduction would have run on Sunday, October 15, 2017. But because federal law and state law changed on October 1, 2017, you could not file for a hearing. I think, in the most conservative view, you now have the remainder of the time you would have had after and including October 1. And that remaining time begins to run again starting February 9, 2018. October 1 to October 15 is 15 days. February 9, 2018 plus 15 days is Saturday, February 24, 2018. You would need to FILE the motion before February 24, 2018. Think of it as a statute of limitations which is stayed because a person goes into a coma and becomes incompetent, but then they regain consciousness 5 months later and the statute starts ticking again where it left off.

Below I set out the history on this and then pose some questions you might have. Pay attention to the part where we discuss what happens if you paid Medicaid from October 1, 2017 until February 9, 2018. You may have an obligation to ask for a refund.

How did this get so screwed up, and what’s Medicaid subrogation?

Up until 2006, the law was clear that NC Medicaid was entitled to 100% of their lien, not to exceed 1/3 of a settlement, prorated with medical providers who had valid liens.

In 2006, SCOTUS ruled in Arkansas v. Ahlborn that state medicaid subrogation statutes could not just set a percentage recovery of the settlement as the amount of subrogation and ingnore the relationship between the gross settlement, the client’s recovery and the amount claimed in the medicaid lien. Ahlborn said states had to allow for a hearing mechanism for courts to set the lien in light of the recovery amount and how much of the recovery was for medical treatment as a proportion to the whole recovery. Most states revised their Medicaid subrogation statues in 2006 and started to allow hearings to reduce Medicaid recovery. They called them “Ahlborn hearings.”

North Carolina did NOT follow Ahlborn. Much to everyone’s frustration.

Several lawyers in NC challenged Medicaid’s refusal to follow SCOTUS’ ruling in Ahlborn. All of the state actions challenging Medicaid’s refusal failed in our appellate courts.

Then in April of 2013 SCOTUS issued an opinion in Wos v. E.M.A., upholding a 4th Circuit opinion (coming from North Carolina), and declaring that the North Carolina medicaid lien statute was in violation of the court’s ruling Ahlborn. By July of 2013, NCAJ had negotiated changes to the Medicaid lien statute to bring it into compliance with Wos and Ahlborn and provide a statutory mechanism to request a lien reduction hearing. Those hearings need to be requested (i.e., filed with a court) within 30 days of the settlement (defined by the signing of a Release or a minor settlement or Industrial Commission approval). This is the statute that was passed: NCGS 108A-57

Finally, NC was compliant with Ahlborn and the few others states that ignored Ahlborn were changing too. Meanhwile, in December of 2013, Congress was battling with President Obama to pass the first budget in years. In October of that year, Congress allowed the government to shut down for 16 days until they passed a temporary continuing funding resolution. On December 26, 2013, Congress (to the surprise of many) passed the Bipartisan Budget Act of 2013. Not until after it was signed into law did anyone notice this section:

SEC. 202. STRENGTHENING MEDICAID THIRD-PARTY LIABILITY.

(b) RECOVERY OF MEDICAID EXPENDITURES FROM BENEFICIARY

LIABILITY SETTLEMENTS.— (1) STATE PLAN REQUIREMENTS.—Section 1902(a)(25) of the Social Security Act (42 U.S.C. 1396a(a)(25)) is amended— (A) in subparagraph (B), by striking ‘‘to the extent of such legal liability’’; and (B) in subparagraph (H), by striking ‘‘payment by any other party for such health care items or services’’ and inserting ‘‘any payments by such third party’’. (2) ASSIGNMENT OF RIGHTS OF PAYMENT.—Section 1912(a)(1)(A) of such Act (42 U.S.C. 1396k(a)(1)(A)) is amended by striking ‘‘payment for medical care from any third party’’ and inserting ‘‘any payment from a third party that has a legal liability to pay for care and services available under the plan’’.(3) LIENS.—Section 1917(a)(1)(A) of such Act (42 U.S.C. 1396p(a)(1)(A)) is amended to read as follows: ‘‘(A) pursuant to— ‘‘(i) the judgment of a court on account of benefits incorrectly paid on behalf of such individual, or‘‘(ii) rights acquired by or assigned to the State in accordance with section 1902(a)(25)(H) or section 1912(a)(1)(A), or’’.EFFECTIVE DATE.—The amendments made by this section shall take effect on October 1, 2014.

The very small change to the subrogation language in federal law had the effect of rendering Ahlborn and Wos moot as both cases depended on the specific language which said “payment by any other party for such health care items or services” and “payment for medical care from any third party” as the basis for the court’s reasoning that Medicaid must, for lack of a better term, prorate settlement funds with the victim of negligence.

I called several members of Congress and found out that the provisions had been slipped in at the last minute and had been pushed by private third-party subrogation companies like Rawlings and HMS who are contractors for many state Medicaid offices. Because these private companies take a percentage of recoveries they recover for the statse, they did not want to have payments to Medicaid (and their profits) lowered in favor of injured victims.

The statute changes did not go into effect until October of 2014, and under pressure from consumer groups, advocates for the disabled, and AAJ, the effective date was pushed to October of 2016. Then as we got closer to October of 2016, it was pushed to October of 2017. Victims of negligence who faced massive injuries with small liability policies were receiving relief from unwieldy Medicaid liens. Injured Plaintiffs could then use those funds to pay for services that Medicaid would not cover for the disabled Plaintiffs. Additionally, Medicaid was still prorating their recovery with valid medical lien holders under NCGS 44-49.

Meanwhile, in 2017, with a new Congress and new President, the North Carolina legislature inserted a change to NCGS 108A-57 in the July 2017 Budget (Senate Bill 257). The changes included a complete re-write of NCGS 108A-57, which eliminated a lien reduction hearing, re-instituted the 1/3 cap on Medicaid recovery (the Plaintiff repaid Medicaid 100% of the lien up to 1/3 of the gross settlement) and the proration with unpaid medical providers with valid liens was eliminated.

This new law only went into effect IF the federal changes from 2013 went into effect on October 1, 2017. The prelude to the change in NC law was a classic “IF/THEN” proposition (highlight added):

NC Senate Bill 257

MEDICAID SUBROGATION RIGHTS CONFORMING CHANGES

SECTION 11H.23.If Section 202(b) of the Bipartisan Budget Act of 2013, P.L. 113-67, takes effect on October 1, 2017, as provided in Section 202(c) of that act, as amended by Section 211 of the Protecting Access to Medicare Act of 2014, P.L. 113-93, and Section 220 of the Medicare Access and CHIP Reauthorization Act of 2015, P.L. 114-10, then G.S. 108A-57 reads as rewritten:

Ҥ 108A-57. Subrogation rights; withholding of information a misdemeanor.

(a) As used in this section, the term “beneficiary” means (i) the beneficiary of….. (then went on to rewrite the subrogation statute)

Consumer lobbying groups were unable to persuade Congress and HHS to delay the implementation of the October 1, 2017 changes, and therefore NC law changed on October 1, 2017 pursuant to the “IF/THEN” portion of the statute.

Which brings us to February 9, 2017. As many of you will recall, after a brief shut down of the US government from midnight of February 8 to the early hours of February 9, Congress passed and the President signed H.R.1892 – Bipartisan Budget Act of 2018.

Thanks to consumer lobbying by AAJ and other disability advocacy groups, the new federal budget repealed the changes to Medicaid law in the 2013 budget as follows:

H.R.1892 – BIPARTISAN BUDGET ACT OF 2018

SEC. 53102. THIRD PARTY LIABILITY IN MEDICAID AND CHIP.

(b) Delay In Effective Date And Repeal Of Certain Bipartisan Budget Act Of 2013 Amendments.—

(1) REPEAL.—Effective as of September 30, 2017, subsection (b) of section 202 of the Bipartisan Budget Act of 2013 (Public Law 113–67; 127 Stat. 1177; 42 U.S.C. 1396a note) (including any amendments made by such subsection) is repealed and the provisions amended by such subsection shall be applied and administered as if such amendments had never been enacted.

(2) [Does not apply to subrogation]

(3) EFFECTIVE DATE; TREATMENT.—The repeal and amendment made by this subsection shall take effect as if enacted on September 30, 2017, and shall apply with respect to any open claims, including claims pending, generated, or filed, after such date. The amendments made by subsections (a) and (b) of section 202 of the Bipartisan Budget Act of 2013 (Public Law 113–67; 127 Stat. 1177; 42 U.S.C. 1396a note) that took effect on October 1, 2017, are null and void and section 1902(a)(25) of the Social Security Act (42 U.S.C. 1396a(a)(25)) shall be applied and administered as if such amendments had not taken effect on such date.

So where does this leave us?

Based upon the language of the Bipartisan Budget Act of 2018, the changes to the key language which vitiated Ahlborn and Wos in 2013 and went into effect on October 1, 2017, are now a nullity. According to the newest federal law, the changes in 2013 were never put into effect on October 1, 2017, because they were repealed on September 30, 2017.

And because Section 202(b) of the Bipartisan Budget Act of 2013, did not take effect on October 1, 2017, there is no change to NCGS 108A-57, the Medicaid subrogation statute.

Which means that 108A-57’s requirements to request a lien reduction hearing are still in effect. NCGS 108A-57requires:

(a2) A medical assistance beneficiary may dispute the presumptions established in subsection (a1) of this section by applying to the court in which the medical assistance beneficiary’s claim against the third party is pending, or if there is none, then to a court of competent jurisdiction, for a determination of the portion of the beneficiary’s gross recovery that represents compensation for the Medicaid claim. An application under this subsection shall be filed with the court and served on the Department pursuant to the Rules of Civil Procedure no later than 30 days after the date that the settlement agreement is executed by all parties and, if required, approved by the court, or in cases in which judgment has been entered, no later than 30 days after the date of entry of judgment. The court shall hold an evidentiary hearing no sooner than 30 days after the date the action was filed. All of the following shall apply to the court’s determination under this subsection:

So what is the deadline to file for 108A-57 hearings to reduce Medicaid’s lien for cases settled from October 1, 2017 to February 9, 2018?

The way the federal changes were implemented on February 9, 2018 leaves a vacuum from October 1, 2017 until February 9, 2018 for all settlements where Medicaid claimed a lien on settlement proceeds. Obviously, during that time period, a Plaintiff had no statutory mechanism to file for a Medicaid reduction hearing under NCGS 108A-57. So there can be no 30 day time limit to file during those months.

So what happens to Plaintiff cases that settled (by release, minor settlement of Industrial Commission Order) from October 1, 2017 until February 9, 2018?

The only logical conclusion is that the 30 day time limit to file a motion for Medicaid lien determination for cases settled from October 1, 2017 through February 9, 2018, begins on February 9, 2018 and runs 30 days until and including Friday March 9, 2018 (or Monday March 12, 2018 if you want to use the “weekend rule”, but why risk it?).

This means that if you settled a case during that time, you MUST file,”by applying to the court in which the medical assistance beneficiary’s claim against the third party is pending, or if there is none, then to a court of competent jurisdiction, for a determination of the portion of the beneficiary’s gross recovery that represents compensation for the Medicaid claim. An application under this subsection shall be filed with the court and served on the Department pursuant to the Rules of Civil Procedure no later than 30 days after the date that the settlement agreement is executed by all parties and, if required, approved by the court, or in cases in which judgment has been entered, no later than 30 days after the date of entry of judgment.”

Practically, this means you need to file a motion for determination if you have a case pending, and if you don’t, you will need to file a Complaint in the underlying action and include a motion to determine Medicaid’s lien. 

What if I had a case settle less than 30 days before October 1, 2017, but I didn’t get a motion filed before October 1, 2017?

I think that the most conservative approach would be that you get whatever time you had left in your 30 day time limit added on beginning February 9, 2018. So if 25 days had gone past from the settlement of your case in September of ’17 when October 1 happened, you would get 5 more days to file, beginning February 9, 2018 and ending February 13 (or maybe 14th depending on how you count it).

What if I paid Medicaid 100% or 1/3 of the settlement from October 1, 2017 through February 9, 2018?

If you paid Medicaid during the “vacuum time” of October 1, 2017 through February 9, 2018, I think you have a 30 day window to request a hearing to have the lien payment evaluated by a court. I would assume that if you convinced the Judge that your client did not need to pay the Medicaid lien 1005 of 1/3 of the settlement, that the Judge could order Medicaid to issue a refund for the overpayment. Also keep in mind that Medicaid now has to pro-rate with unpaid medical providers with valid liens.

What if I paid Medicaid 100% or 1/3 of the settlement from October 1, 2017 through February 9, 2018 and I’m ok with the amount BUT I wasn’t able to pay valid medical lien holders because Medicaid would no pro-rate under the revised statute in effect at that time?

This is a harder question. Before October 1, 2017, you could tell Medicaid you had valid lien holders, prove that with copies of the liens, and reduce Medicaid’s lien by the prorated amounts of the medical lien holders. You didn’t need a hearing to make Medicaid prorate. It was by operation of law in all scenarios where you pay subrogation:.

NCGS 108A-57

(a5) The medical assistance beneficiary or any attorney retained by the beneficiary shall, out of the proceeds obtained by or on behalf of the beneficiary by settlement with, judgment against, or otherwise from a third party by reason of injury or death, distribute to the Department the amount due pursuant to this section as follows:

(1) If, upon the expiration of the time for filing an application pursuant subsection (a2) of this section, no application has been filed, then the amount presumed pursuant to subsection (a1) of this section, as prorated with the claims of all others having medical subrogation rights or medical liens against the amount received or recovered, shall be paid to the Department within 30 days of the beneficiary’s receipt of the proceeds, in the absence of an agreement pursuant to subsection (a3) of this section.

(2) If an application has been filed pursuant to subsection (a2) of this section and no agreement has been reached pursuant to subsection (a3) of this section, then the Department shall be paid as follows:

a. If the beneficiary rebuts the presumption arising under subsection (a1) of this section, then the amount determined by the court pursuant to subsection (a2) of this section, as prorated with the claims of all others having medical subrogation rights or medical liens against the amount received or recovered, shall be paid to the Department within 30 days of the entry of the court’s order.

b. If the beneficiary fails to rebut the presumption arising under subsection (a1) of this section, then the amount presumed pursuant to subsection (a1) of this section, as prorated with the claims of all others having medical subrogation rights or medical liens against the amount received or recovered, shall be paid to the Department within 30 days of the entry of the court’s order.

(3) If an agreement has been reached pursuant to subsection (a3) of this section, then the agreed amount, as prorated with the claims of all others having medical subrogation rights or medical liens against the amount received or recovered, shall be paid to the Department within 30 days of the execution of the agreement by the medical assistance beneficiary and the Department.

I do not think the 30 day deadline to file a motion applies to this situation if you have already paid Medicaid.

I think you should only have to write a letter to HMS/Medicaid, show them what you paid, prove that there were valid liens when you overpaid Medicaid, and ask that Medicaid refund the portion of the proceeds which should have been paid to valid medical lien holders. I don’t know if Medicaid would want to make that check payable to your client (I’m guessing they will want to do that), or to the medical providers. Then it would be up to you to distribute the funds.

Practically, if you had the valid medical liens during this time, you need to notify your client of the changes in the law and that the client has the option of having you ask Medicaid to make a refund that will be paid toward their unpaid medical balances.

But wait, I paid Medicaid on some liens from October of 2017 until February of 2018. I don’t think those cases needed a lien reduction hearing. Do I HAVE to look back and see if any of those files had valid medical liens that should (had the law allowed at the time) have been prorated with Medicaid?

Do you HAVE to ask for a refund of the (now) overpayment to Medicaid when there were valid medical provider?  Probably so. 

Why? You have a legal duty pursuant to NCGS 44- 49 and 50, and now an ethical duty, pursuant to 2017 Formal Ethics Opinion 4, to honor valid medical provider liens, regardless of the client’s desires. When you combine your duty to pay a valid medical lien under NCGS 44-49 and 50 with the ethical duty imposed to honor valid legal liens, I think you have to go back and look at any Medicaid payments you made from October 1, 2017 until February 9, 2018.

In summary, this is all great news for Plaintiffs, but we have to watch the potential deadline issues!

Questions? Feel free to email at Chris@NicholsTrialLaw.com
Chris Nichols

This can make scheduling trials and motions difficult.

Here is a link to the names, adresses and emails of the TCAs and TCCs in North Carolina:

http://www.nccourts.org/Courts/CRS/Councils/DRC/Documents/MSCCourtContacts.pdf

Chris Nichols

The Governor signed the new bill incorporating the holding of Wos on July 18, 2013. The bill is effective immediately. You can view House Bill 982, in final mark-up version here: House Bill 982 

Here are the things we KEPT in the old § 108A-57. Subrogation rights; withholding of information a misdemeanor:

• Medicaid is still limited to a maximum of 100% of the lien OR One Third (1/3) of the gross settlement.
• Medicaid still prorates within their 1/3 with unpaid medical providers asserting liens.
• Payment by the lawyer of the 100% or 1/3 of the gross settlement is full and final payment of Medicaid’s lien (but medical lien holders paid pro-rata still get are owed their balances pursuant to NCGS 44-49 and 50. 

Here are the NEW provisions that reflect the Supreme Court’s determination that our previous Medicaid statute was in conflict with Federal law:

• Medicaid recipients can challenge the 1/3 or 100% lien by filing a Petition with a court of competant jurisdiction for “a determination of the portion of the beneficiary’s gross recovery that represents compensation for the Medicaid claim.”
• TIMING OF PETITION: Those petitions must be filed within 30 days of all parties signing a settlement agreement OR court approval of the settlement OR a judgment being issued.
• The Court will conduct an evidentiary hearing and may consider any factors it deems just and reasonable in determining the allocation of the settlement.
• The burden of proof is on the petitioner to prove by “clear and convincing evidence” that Medicaid is demanding too large a portion of the settlement.

One other excellent part of the new statute says Medicaid can compromise the liens at any time:

(a3) Notwithstanding the presumption arising pursuant to subsection (a1) of this section, the medical assistance beneficiary and the Department may reach an agreement on the portion of the recovery that represents compensation for the Medicaid claim. 

In the past, Medicaid took the position they could not negotiate their lien with recipients. This new portion allows for that negotiation to occur at any time, even before a petition is filed.

Chris Nichols
www.NicholsTrialLaw.com

You can download the pdf files and open them in Acrobat and then CTRL F search for the codes that show up on your conditional payment letters from Medicare. This will help you sort out medical visits that have been “coded” for payment for non-related medical procedures and visits.

This makes it easier to find and eliminate appointments for pre-existing conditions. You can also scan in a long conditional payment spread sheet, do a conversion to searchable text (OCR) and then use the search feature on that to find the billing codes.

Hope this is helpful to some of you.

Chris Nichols
www.NicholsTrialLaw.com

Can a medical provider claim a lien under NCGS 44-49 if the medical bills have been paid by the workers compensation carrier prior to injured worker pursuing a third part claim against a tortfeasor?

Worker was injured, workers comp. paid his medical bills at the local hospital. A case was pursued against the negligent third party and we just received a lien notification letter from the hospital.

Can they do this?

My answer:

No. A workers compensation (WC) medical payment is a “payment in full.” The hospital submitted to WC, WC paid what is the allowable expense and the hospital has to write off the remainder. They don’t get to double bill or bill for the unpaid portion.

I would write the hospital a letter asking them to set out in writing what what the total charges are, what they have been paid in the past, and what they are asking from your client now.

Get that in writing.

The follow up with a letter to the department that claimed the lien and make sure you copy one of the Medical Dcotors in charge with the following laws:

http://www.ncga.state.nc.us/EnactedLegislation/Statutes/HTML/BySection/Chapter_97/GS_97-26.html

A medical provider’s reimbursement is limited to the maximum amount approved in the NCIC Medical Fee Schedule, unless the provider has contracted with the insurer for a different amount. If neither the fee schedule nor a contractual fee applies, the maximum reimbursement allowed is the usual, customary, and reasonable charge for the service.

N.C.G.S. §97‐26(c)

N.C.G.S. §97‐90(e) governs this issue and states:

“A health care provider shall not pursue a private claim against an employee for all or part of the costs of medical treatment provided to the employee by the provider unless the employee’s claim or the treatment is finally adjudicated not to be compensable or the employee fails to request a hearing after denial of liability by the employer.”

N.C.G.S. §97‐88.3(c) establishes penalties for medical providers who improperly pursue private claims against employees:

“A health care provider who knowingly charges or otherwise holds an employee financially responsible for the cost of any services provided for a compensable injury under this Article is guilty of a Class 1 misdemeanor.”

That’s straight out of the North Carolina Medical Society guide: http://www.ncmedsoc.org/non_members/project_sustain/workerscomp_faq.pdf

I’m thinking that when faced with criminal liability, the hospital will about face on this one.

And of course, if the bill was never submitted to or paid by WC, then I think they can claim a lien. Though if they breached their duty to submit to WC, then they may just be completely out of luck.

Don’t forget that WC does have a lien for the medical bills they paid.

Chris Nichols
www.NicholsTrialLaw.com

I believe that House Bill 542 may “look” good for business but have the unintended consequence of making North Carolina the WORST place for manufacturing in the entire United States. I’ve inserted a few comments below in [BOLD] brackets.

Rep. Stam, Rep. Weiss, and Rep. Murray:

I am a lawyer, like each of you, and I would like to call to your attention what I think is a major unintended consequence of HB 542. I called each of your offices today to discuss this issue.

HB 542 destroys the right of a NC manufacturer and their insurance company to subrogate on catastrophic losses caused by defective products.This hurts manufacturing, business, and insurance interests in North Carolina.

Please read the below example:

Products Liability Immunity Destroys Business and Insurance Subrogation: HB 542 gives immunity from suit to any company that produces a faulty product that has been “approved for sale” by any State of Federal regulatory agency. This bar would apply to insurance subrogation claims against the original tortfeasor and therefore bars insurance companies and the self-insured from recouping losses caused by faulty products.

EXAMPLE.Power Plant Explosion: A North Carolina power company buys a defective industrial boiler from a Chinese (or any) manufacturing company. This product is “approved” by several state and federal agencies as required by law.” [Does this sound like the Apex Chemical explosion?]

That boiler explodes and spreads toxic ash over a 3 mile radius. The environment is polluted, people are made sick, and the business site is shut down. The NC business itself suffers a $300 Million dollar business and property damage loss and is sued by the State and citizens for the toxic ash injuries. The insurer for the power company (or self-insured company itself) must pay for the business loss, claims of injuries and property loss, but would be prohibited by HB542 from seeking a recovery from the negligent Chinese manufacturer. The State of North Carolina would be prohibited from seeking compensation for the loss to the environment and the toxic clean up costs. This will increase the cost of insurance for business and the State and possibly force insurers to stop insuring for loss from product defect.

HB542 uses the following definitions: [See page 8 of HB542] ” (1) “Claimant” means a person or other entity asserting a claim”

“Product liability action” includes any action brought for or on account of personal injury, death or property damage caused by or resulting from the manufacture, construction, design, formulation, development of standards, preparation, processing, assembly, testing, listing, certifying, warning, instructing, marketing, selling, advertising, packaging, or labeling of any product.” (Emphasis added)

“No manufacturer or sellershall be held liable in any product liability action if any one of the following apply:”

Under this very simple language above, businesses that suffer catastrophic losses due to product defects will NOT be able to recoup those loses.

Moreover, what will be the effect on Business Insurance Policies? A standard loss policy would have language like the following:

“If we pay a claim under your policy, we will take over your right to recover that amount from any other person or organization. You agree to cooperate with us and not do anything that will interfere with our chances of recovery”.

Insurers would be subrogated to the right of the North Carolina company. Because subrogation is “the substitution of one person in the place of another with reference to a lawful claim, demand, or right, so that he who is substituted succeeds to the rights of the other in relation to the debt or claim, and its rights, remedies, or securities,” the North Carolina Company would have no right to recover under HB542 and thus the insurance company would be subrogated to nothing.

North Carolina will be the ONLY state in the nation with such a law.

This raises many difficult questions:

1. Will insurance companies issue large commercial policies to North Carolina manufacturers know there will be no right to subrogate in failed products cases? Can businesses operate without this insurance?
2. Will North Carolina manufacturers receive insurance rate increases due to the higher cost risk for North Carolina claims?
3. Will manufacturers avoid locating in North Carolina because they will not be protected from defective products they purchase for their business?
4. Will insurance products for consumers be impacted by the lack of subrogation for faulty manufacturing? Will home owner insurance rates increase due to the number of fires caused by defective products where there will be no subrogatable interest for the insurance company?
5. Why would a manufacturer choose North Carolina over 49 other states knowing that it had no protections from faulty products within its own facility?

I ask that you stop HB542 before it further erodes North Carolina’s business economy.

Chris Nichols

________________________________

(update) 

A non-hypotehtical Example of Products Liability Subrogation In Insurance

Here is an excellent example of how subrogation works in the context of product liability claims. This is a blog post from Cozen O’Conner, a national law firm that helps insurance companies recover funds from manufacturers of defective produts when those products cause damage which is insured. Here is a link to their full blog post. Lasko Recalls 4.8 Million Box Fans

The case involved a massive barn fire at a breeding farm in Hondo, New Mexico. Six world class race horse breeding stallions were killed in the fire and the barn itself was totaled. Cozen O’Connor represented over sixty sophisticated horsemen clients who had ownership interests in the stallions, and their insurers. The insurers for the horses and the barn went to great lengths to preserve the fire scene, and as a direct result of their diligence the experts were able to examine each electrical device in the barn and identify the fatal flaw in the Lasko fan motor.

On March 24th (long after the fire) the Consumer Product Safety Commission announced a voluntary recall of 4.8 million Lasko box fans. The recall notice reports “an electrical failure in the fan’s motor poses a fire hazard to consumers.” The CPSC cites a “barn fire resulting in extensive property damage” as a basis for the recall.

If this fire had occurred in North Carolina under House Bill 542, the lawyers at Cozen O’Conner would have been barred from seeking recovery from Lasko. The insurer would have paid out millions and not been reimbursed by the negligent manufacturer of the fan. And who would absorb the cost of the unreimbursed expenses? Anyone who buys insurance.

_______________________________________

Hopefully this will make a difference. This bill is not just about people injured by defective products, but also business.

This is an actual photo of the Apex, NC plant explosion at a chemical storage facility.

UPDATE: 4:24 pm March 30, 2011: The Bill has finally been filed, all of 18 hours before it is to be debated. House Bill 542

Here is the relevant language:

No manufacturer or seller shall be held liable in any product liability action if:

1. The product alleged to have caused harm was designed, manufactured, packaged, labeled, sold, or represented in relevant and material respects in accordance with the terms of approval, license or similar determination of a government agency, where the approval, license or similar determination is relevant to the event or risk allegedly causing the harm; or
2. The product was in compliance with a statute of this State or the United States, …where the stature or agency action is relevant to the event or risk allegedly causing harm….

This is HUGE.

This means that a product regulated by ANY state or Federal agency would be immune from suit by North Carolina citizens who are hurt or maimed by the product which is eventually found defective.

Think: bad tires, bad cars, Vioxx, bad drugs, toys containing lead or poison, etc.

Here is a “short” list of products whose manufacturers would be immune from a law suit if that product killed you or hurt you or someone you love.

Manufacturers of 328 Types of Products regulated and approved by the US Agencies will receive IMMUNITY from law suits for defective products that maim, kill and destroy property and people.

The manufactures of defective products would receive immunity from suit because the agency is “vested with the authority of this State or of the United States to issue rules, regulations, orders, or standards, concerning the design, manufacture, packaging, labeling, or advertising of a product or a service.” Tort Reform for Citizens and Businesses: Section 3.1(b) amendment to Chapter 99B-1 (1a)

US Consumer Product Safety Commission (USCPSC) Regulated Products

Acetaminophen (products containing)

Acetic acid (products containing)

Adhesives -containing methyl alcohol

Adhesives -extremely flammable contact

Adhesives -floor covering

Adhesives nitrocellulose base

Aerosols (see self-pressurized products)

Ammonia, ammonia water (products containing) household, ammonium hydroxide

Antennas – CB base station and TV

Antennas -Omnidirectional CB base station

Antifreeze, ethylene glycol

Antiquing kits

Appliances, coal and wood-burning

Architectural glazing materials

Art Materials

Artist’s paints

Asbestos- containing patching compounds

Asbestos -containing garments for general use

Aspirin products

Baby bouncers & walkers

Balloons, plastic mixtures

Batteries, storage, wet-cell

Benzene paint solvents containing

Bicycles

Bicycle helmets

Biological specimens, preserved

Blasting caps

Bunk Beds

Butane in cigarette lighters

Carbolic acid (phenol) (products containing)

Carbon tetrachloride (products containing)

Carpets and rugs (large)

Carpets and rugs (small)

Caustic poisons (products containing)

Caustic poisons – potash (products containing)

Caustic poisons – soda (products containing)

Cellulose insulation

Cellulose sponges

Charcoal briquettes

Chemistry sets

Child-resistant packaging (see special packaging)

Chlorofluorocarbons, self pressurized products containing Acetonitrile (see glue remover)

Aluminized polyester film kite

Asbestos -containing artificial emberizing materials

Benzene (products containing) benzol

Bergamot oil (products containing)

Betamethasone (products containing)

Children’s Products (see “Toys/Children’s Products”)

Cigarette lighters

Cleaning products

Clothing (see wearing apparel, sleepwear)

Coal burning appliances (see appliances)

Combustible hazardous substances

Conjugated estrogen tablets (products containing)

Consumer product

Containers consumer-owned (portable)

Controlled drugs (products containing)

Corrosive substances (products containing)

Cosmetics

Cribs -full size

Cribs -non-full size

Cushions, infant

Cyanide salts (products containing)

Dietary supplements, iron-containing (products containing)

Disclaimer deceptive use of

Dive Sticks

Drain cleaners, liquid

Drugs, Oral Prescription -All Exceptions

Drugs -controlled

Drugs -iron containing

Drugs -oral prescription

Drugs -over the counter

Dry-cleaning solvents

Epoxy resins

Ethylene glycol (products containing)

Ethylene glycol in felt pads

Exports (noncomplying products)

Extremely flammable contents of self-pressurized containers

Extremely flammable hazardous substances

Extremely flammable solids

Eye irritants (products containing)

Fabrics

Felt-tip marking devices

Cholestyramine, anhydrous (products containing)

Clacker balls

Colestipol (products containing)

Dibucaine (products containing)

Diethylene glycol (products containing)

Diethylenetriamine (products containing)

Diglycidyl ethers (products containing)

Diphenhydramine preparations

Emberizing materials artificial, containing asbestos

Erythromycin ethylsuccinate, Suspension & granules

for suspension (products containing)

Erythromycin ethylsuccinate, tablets (products containing)

Ethanol containing mouthwash

Ethylenediamine (products containing)

Ferrous oxalate (products containing)

Fire extinguishers

Fireworks

First Aid

Flammable contents of self-pressurized containers

Flammable solids (products containing)

Flammable substances (products containing)

Fluoride (products containing)

Food

Formaldehyde (products containing)

Fuel

Furniture painted with lead containing paint

Furniture polish -liquid

Furniture polish -paste

Garage Door Openers- automatic residential

Gasoline

Glazing compounds

Heaters (see appliances)

Highly toxic substances (products containing)

Household substances

Hydrocarbons

Hydrochloric acid (products containing)

Ibuprofen (products containing)

Imported products & importers

Imports

Industrial supplies

Infant cushions

Ink cartridges dry concentrate containers

Ink-marking devices

Insulation, cellulose

Iron preparations

Irritant substances

Kerosene

Kindling & illuminating preparations

Labels

Laboratory chemicals (if educational)

Lacquers

Lawn darts

Lawnmowers power

Fertilizersdry

granular

Fuel kits with diflouro dichloromethane

Glue remover containing acetonitrile (household)

Hartshorn (products containing)

Hypochlorous acid (products containing)

Isobutane in cigarette lighters

Isosorbide dinitrate -prescription sublingual and chewable forms (products containing)

Ketoprofen (products containing)

Kites aluminized polyester film

Lead in paint (products containing)

Lighter fluid, etc. (products containing)

Lunar caustic (silver nitrate) (products containing)

Lye (products containing)

Matchbooks

Matches

Mattresses (cigarette ignition)

Mattresses (open flame ignition)

Methyl alcohol (methanol) (products containing)

Mineral oil in toys (products containing)

Mineral seal oil (products containing)

Mineral spirits (products containing)

Minoxidil (products containing)

Mirrors

Mixtures of hazardous substances

Mouthwash containing ethanol

Multiple hazard substances with

Multipurpose Lighters

Naphtha (products containing)

Neutralizers, Permanent Wave (see Permanent Wave Neutralizers)

Nitric acid (products containing)

Nitroglycerine prescription (products containing)

Oral contraceptives

Orris root powdered (products containing)

Over-the-Counter (OTC) Drugs (see Drugs, Over the Counter)

Oxalic acid and salts (products containing)

Packages, child resistance (see child-resistant packaging)

Packages, sample

Paint (lead in) (products containing)

Paint solvents

Painting kits

Paper items

Patching compounds containing asbestos

Percussion explosives

Lidocaine (products containing)

Loperamide (products containing)

Mebendazole (products containing)

Medroxyprogesterone acetate tablets (products containing)

Methacrylic acid (products containing)

Methylprednisolone (products containing)

Methyl salicylate (products containing)

Naproxen (products containing)

Nitrites (Butyl and Volatile Alkyl)

Norethindrone acetate tablets (products containing)

Pacifiers (see Toys/Children’s Products)

Pancrelipase (products containing)

Paraphenylenediamine (products containing)

Perchloroethylene in visual novelty devices

Petroleum distillates

Photographic color processing kits

Plant foods -dry granular

Poisons, caustic (products containing)

Polishing products

Potassium hydroxide

Prescription Drugs (Oral)

Pressure-generating substances

Propellant devices for model rockets

Radiator cleaners

Radioactive substances

Refrigerator doors

Refuse bins -unstable

Roof coatings

Rope, cord, string, etc.

Rugs see Carpets

Rubber vulcanizing products

Self-pressurized products

Self-pressurized products containing vinyl chloride

Sensitizers (products containing)

Signal words

Sodium hydroxide

Solder kit

Solder paste

Permanent wave neutralizers containing sodium bromate or potassium bromate

Phenol (carbolic acid)

Photodynamic sensitizer

Potash, caustic

Potassium supplements effervescent

(products containing)

Prednisone

Primary irritant

Sacrosidase (sucrase) in a solution of glycerol and water

Salt (sodium chloride)

Self-pressurized products containing chloroflorocarbons

Silver nitrate (lunar caustic)

Sleepwear, children’s, sizes 0-6x & sizes 7-14

Sodium arsenite

Sodium fluoride

Sodium/potassium hydroxide

Special packaging

Spot removers single-use

Spot removing kits

Sponges, cellulose

Swimming pool slides

Tank coatings

Thread, string, twine, etc.

Turpentine (products containing)

Varnish

Video games

Vienna paste (products containing)

Vinyl chloride (products containing)

Solvents (for Paint and other surface coatings)

Stoddard solvent

Stoves, coal & wood burning

Strong sensitizers

Sulfuric acid

Toluene (toluol)

Toxic substances

Toys/Children’s Products- All

Toys/Children’s Products- choking hazard warnings for small parts, balloons, marbles, balls

Toys/Children’s Products- balls, small

Toys/Children’s Products- caps & toy guns producing, impulse-type sound

Toys/Children’s Products- choking incidents

Toys/Children’s Products- clacker balls

Toys/Children’s Products- electrically-operated toys and children’s article

Toys/Children’s Products- games, self-pressurized -hollow plastic toys games

Toys/Children’s Products- marbles

Toys/Children’s Products- mineral oil

Toys/Children’s Products- painted with lead or containing lead

Toys/Children’s Products- pacifiers

Toys/Children’s Products -rattles

Toys/Children’s Products -sharp edges

Toys/Children’s Products -sharp points

Toys/Children’s Products -small parts

Toys/Children’s Products -model rockets

Toys/Children’s Products -model rockets, propellant

Toys/Children’s Products -train smoke

Toys/Children’s Products -use and abuse tests

Toys/Children’s Products -tubes, collapsible metal (labeling)

Toys/Children’s Products -unpackaged hazardous substances (labeling)

Vinyl plastic film

Walker-jumper

Wax containers

Waxes, paste for autos, furniture, floors and shoes

Wearing apparel

Writing instruments

Visual novelty devices -containing perchloroethylene

Volatile flammable materials

Water-repellent mixtures (masonry)

Wood burning appliances

Xylene (xylol)

Federal Drug Administration (FDA) PRODUCTS

Food safety

Tobacco products

Dietary supplements

Prescription and over-the-counter pharmaceutical Drugs

Vaccines

Biopharmaceuticals

Blood transfusions

Gene therapy

Cell and tissue based products

Medical devices

Electromagnetic radiation emitting devices (ERED)

cellular phones

airport baggage screening equipment

television receivers

microwave ovens

tanning booths

laser products

Veterinary products

Cosmetics

Sanitation requirements on interstate travel

Control of disease on products

Sperm donation for assisted reproduction

United States Department of Agriculture (USDA) Regulated Products

Meat

Poultry

Egg products

National Highway Traffic Safety Administration (NHTSA) Regulated Products

Vehicle safety

Vehicle recalls

Child safety seats

Airbags

Safe auto parts

Tire safety

Steering components

Fuel system components

Accelerator controls

Wheels that crack or break

Engine cooling fan blades that break

Windshield wiper assemblies that fail

Seats and/or seat backs that fail

Critical vehicle components that break

Wiring system problems that result in a fire

Car ramps or jacks that may collapse

Air bags that deploy incorrectly

Child safety seats that contain defective safety belts
__________________________________________________________________

HIGH COSTS TO STATES

No other state in the Nation has a law like this. The only state that is close is Michigan, which has a provision that deals only with immunity for Drug Manufacturers who receive FDA approval. Other states have had lesser versions of this bill but none had given complete immunity. This is an interesting history of “FDA defense” bills: http://www.centerjd.org/archives/studies/MIDrugImmunityF.pdf

As a result of Michigan’s “FDA Law”, the State of Michigan lost $82 MIllion dollars in “refunds” from the manufacturer of Vioxx who was accused of falsifying safety records to the FDA.

One of the reasons Michigan passed the law in 1995 was to attempt to keep Merck and Pfizer as empoloyers in the state. Michigan passed the law and Merck left anyhow. also In 2007, Pfizer announced plans to completely close the Ann Arbor, Nagoya and Amboise Research facilities by the end of 2008, eliminating 2,160 jobs and idling the $300-million dollar Michigan facility.

Can North Carolina afford to give a pass on the safety of all of these items?

Vioxx cost Michigan $82 million in additional Medicaid costs.Michigan can’t recover those damages from Merck because of the “FDA defense.” If this bill is enacted, NC Medicaid and NC taxpayers will also be left holding the bag. The Michigan Court of Appeals affirmed this “defense” on March 11, 2011.

These questions need to be asked:

WHY DOES THE LEGISLATURE WANT TO MAKE NC THE DUMPING GROUND FOR DANGEROUS AND DEFECTIVE PRODUCTS, WITHOUT CREATING A SINGLE JOB?

WHY WOULD THE LEGISLATURE LEGALIZE THE SALE OF DANGEROUS DRUGS?

HOW DID NC GET THIS PROPOSED LAW?

How did this “law” get to North Carolina? It got here from ALEC, the “American Legislative Exchange Counsel” a libertarian and conservative think tank funded by big industry with their goal of protecting corporate interests from any safety regulation.

Who funds ALEC? If you go to the link you will find a long list of manufacturers, drug makers, industrial polluters, and other “mega corporations”.

WHAT CAN I DO?? IF YOU DON’T THINK THIS IS A GOOD IDEA FOR NC, PLEASE CONTACT ANY MEMBER OF THE HOUSE SELECT COMMITEE ON TORT REFORM:

You can find them at NC House Select Committee on Tort Reform. Or here: http://www.ncga.state.nc.us/gascripts/Committees/Committees.asp?sAction=ViewCommittee&sActionDetails=House%20Select_127

Send them an email or a letter. Or give them a call. They meet tomorrow (Thursday, March 31) at 11 am. Act now, before it is too late.

Chris Nichols

QUESTION: Is Medicaid’s lien capped at one third of liability proceeds received or half of what is left over after attorney’s fees? In other words, if I am pro-rating a Medicaid lien with 44-49 liens and my fee is 25%, are they still sharing a third or are they sharing 37.5%?

ANSWER: Medicaid gets no more than 1/3 of the total settlement. Your attorney fees are irrelevant to Medicaid’s share. The most Medicaid can get is 1/3 of the settlement, even if you charge only 1 dollar as a fee.
 
Medicaid will prorate with NCGS 44-49/50 liens within their 1/3 share. But remember that paying the parorata share of the 44-49/50 liens does not extinguish the balance of the medical bill. The client still owes the balance after the prorata share unless you negotiate a “final payment” compromise with the mediacl provider. 44-49/50 simply act as as a way to get the lawyer out of the middle and get the provider some money before they have to turn to a collection action to get it.
 
The 1/3 (or Medicaid’s portion thereof) DOES take care of Medicaid, in full.

_________________________

Chris Nichols
www.NicholsTrialLAw.com

Rebalancing the scales of justice

Barack Obama must stop the supreme court from providing immunity to health insurers and other corporate law-breakers

• by Simon Lazarus and Ian Millhiser
• guardian.co.uk, Thursday November 13 2008 18.00 GMT

Fourteen years ago, a single mother named Ann Dunham began a long, ultimately unsuccessful battle with cancer – and a simultaneous war with her health insurance provider. Over and over, as Ms Dunham’s son, Barack Obama, recounted during the October 6 presidential debate, company representatives suggested that his mother’s cancer “may have been a pre-existing condition and they don’t have to pay her treatment”.

Ann Dunham’s story is hardly unique. Millions of Americans know well that the pain of serious illness is often compounded by endless jousts with insurers arbitrarily withholding coverage of physician-prescribed care. Myriad court records tell the stories of people like Maureen Kurtek, who lost five fingertips and most of her right foot after her husband’s employer switched to an insurer which resisted continuing to cover her lupus treatment. And of construction manager James Lind, who was able to continue working despite his multiple sclerosis, until his insurer abruptly declined to continue paying for the prescription that had kept his MS at bay. And Rhonda Bast, who died after her insurer refused coverage of a bone marrow transplant which could have prevented her cancer from spreading to her brain.

Many of these sad stories could and should have been avoided. The fault lies with senior federal officials driven by the same deregulatory fervour responsible for enabling the imprudent lending frenzy behind the current financial crisis. In this case, however, the zealots do not run administrative agencies or departments. They preside at the United States supreme court. Over the past quarter-century, court majorities, led principally by Justice Antonin Scalia, have systematically dismantled the framework of laws designed to prevent benefit providers from breaking their promises to patients like Ann Dunham.

The keystone of this protective framework is the Employee Retirement Income Security Act, known by its acronym, Erisa. Congress passed Erisa in 1974 to protect the pensions and employer-provided health plans which millions of Americans rely upon. Yet the supreme court has twisted this law into something quite different. As noted by Senate judiciary chairman, Patrick Leahy, the court’s perversion of Erisa is a prime example of decisions that have turned laws “on their heads, making them protections for big business rather than ordinary citizens.”

Erisa sets strict standards to ensure that employers and insurers administering group benefit plans act “solely in the interests of beneficiaries for the exclusive purpose of providing benefits,” not their own bottom-line. But the court has rendered these protections meaningless. In a Catch-22 decision written by Justice Scalia, a 5-4 majority held that, when plan administrators violate their obligations under the law, victims may not recover any monetary compensation for resulting losses they suffer. Adding insult to injury, the court has read Erisa as a warrant for “pre-empting” – ie abolishing – pre-existing state law protections, leaving victims with literally no recourse. Thus, in the words of, the late Justice Byron White, the supreme court has achieved the “perverse anomaly of leaving those Congress set out to protect with less protection than they enjoyed before Erisa was enacted.”

When forced to apply the supreme court’s “tangled” Erisa rules, ordinarily circumspect federal judges have often harshly attacked them. Most famously, the late Chief Judge Edward Becker, a Republican named to the third circuit court of appeals by President Reagan, excoriated Justice Scalia and his allies for converting Erisa “into a shield that insulates HMOs from liability for even the most egregious acts of dereliction committed against plan beneficiaries, a state of affairs directly contrary to the intent of Congress.” Judge Becker stressed that the court’s distortion of Erisa creates “strong incentives for HMOs to deny claims in bad faith or otherwise ‘stiff’ participants.” The systemic result, he added, is a “‘race to the bottom’ in which the most profitable HMOs will be those that deny claims most frequently.”

A recently discovered insurance company memo (pdf) confirms Judge Becker’s insight. This smoking gun, an internal company directive, instructed claims processors to structure “new and existing policies” so as to ensure that they would be subject to Erisa. Once covered by this federal law originally hailed as a landmark safeguard for beneficiaries, the memo forecast, the company could eliminate over 90% of its payouts to claimants seeking redress for denials of coverage.

Immunity for health insurers is just one gift which the supreme court has given to powerful interests that find compliance with the law inconvenient. The most notorious recent example is the 2007 Ledbetter decision, in which the court’s five conservatives held that victims of pay discrimination have only six short months to seek relief – even if they do not learn of the discrimination until years later. But the supreme court has also thwarted Congress’ efforts to protect Americans with disabilities against discrimination (pdf). It has erected unprecedented barriers to patients seeking redress for unlawfully withheld Medicaid benefits, pre-empted state predatory lending (pdf) curbs, and extended lawsuit immunity to the manufacturers of dangerous medical devices. In case after case, the court has achieved de facto repeal of federal guarantees by eliminating citizens’ ability to enforce them in court, and, through pre-emption, secured outright repeal of state law protections.

As the new president rolls out new proposals for ensuring health and economic security, he should not ignore the court’s drive to roll back existing safeguards. If he acts fast, he could score some significant early wins, and send a clear signal that the new sheriff in town is serious about justice for ordinary citizens. Early in this Congressional term, it could be possible to legislatively “fix” decisions that distort major laws like Erisa and the Civil Rights Act equal pay guarantees upended in the Ledbetter case. His agency heads can rescind the mass of Bush administration regulations and policies that pre-empt vital state legal protections. His justice department can press the federal courts to faithfully construe laws in line with their original reformist purposes, and stop importing stealth deregulatory designs recently in vogue. Most important for the long-term, the president, together with allies in the Senate, can sensitise new judicial nominees to the priority of robust enforcement of guarantees protecting Americans’ pocket book needs.

By targeting courts that coddle corporate law-breakers, President Obama can engineer change that will save millions of Americans from major financial, physical, and emotional travail.

Simon Lazarus and Ian Millhiser are attorneys with the National Senior Citizens Law Centre

I promised to post the supporting materials and you can download the Personal injury Checklist here.

Good luck to all of you. If you need to ask any questions, just email me though my website.

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Chris Nichols
www.NicholsTrialLaw.com

The article below was written by a self-described conservative Christian physician who deeply questions the politics of taking away justice from injured people in the name of politics and for the goal of profitting “big business.”

This shows me that people are seeing that fairness and responsiblity are truly non-partisan issues, and that lawsuits, in and of themselves, are not “all bad.” In fact, lawyers and lawsuits have often been all that stands between the public and harm.

Remember the Little Guy
by Steven Hotze, M.D.

Shouldn’t companies and individuals who cause you harm be responsible for the damages they inflict?

You are probably aware of the lawsuits in the 1970s against Ford Motor Company and its Pinto automobile. Because of poor design, rear end crashes often caused the Pintos gasoline tank to explode into flames. Over 500 drivers lost their lives and thousands more were severely burned. Ford knew about this problem and that it would only cost $11 per car to repair but determined it was cheaper to pay the lawsuit settlements than recall the vehicles. Incredibly, Ford put their profits above the safety of their customers.

Because plaintiff attorneys were willing to file lawsuits on behalf of these injured individuals and families on a contingency basis and fight the multi-billion dollar Ford Motor Company, Ford paid hundreds of millions of dollars in judgments. Ford was also criminally charged with negligent homicide for having knowingly sold unsafe cars.

These lawsuits against Ford were based on product liability law which holds businesses responsible for any injuries caused by their products. The Ford lawsuits and resulting settlements sent a strong signal to the automobile industry. Safer cars have been the result.
Over the past decade, the Republicans in the Texas Legislature have passed a series of bills which have limited the liability of large corporations when they are found by a jury to have caused injury to their employees or their customers. This has me concerned and it should have you concerned as well.

Who wouldnt want limited liability for their actions? This is especially true of some large corporations which place their financial interests above the well being of their employees and customers.

Under current Texas law, it is hard to imagine that Ford Motor Company would have been required to pay out such a large amount of money in judgments as it did at that time.

Tort reform has dramatically limited the liability of businesses and individuals in Texas. The Texas Legislature has set limits on the amount that a business or individual can be required to pay in judgment to an injured party. No one likes the idea of frivolous lawsuits, but most individuals seem to agree that a remedy should be paid to an injured party commensurate with the damage.

Who does this current law benefit? It benefits the large corporations and the well financed who have deep pockets and the wherewithal to hire a bevy of defense attorneys. Their financial risk for shoddy workmanship and unsafe products has been dramatically reduced.

What about the small business owner or the individual with modest means? How will they afford the assistance of a lawyer to help them be fairly compensated for their losses?

As a physician and conservative, I have a healthy distrust for big government and big business. The conservative position requires accountability for actions. It appears to me that the pendulum for tort reform has swung too far in favor of big business.

Its time to remember the little guy.

by Steven Hotze, M.D.

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Chris Nichols
www.NicholsTrialLaw.com