Answer to Case Could Reshape Medicaid Laws in North Carolina

The answer to a case, which is expected in June, will help shape how North Carolina and other states reclaim Medicaid funds that are spent on patient care. Currently, in North Carolina, the state can legally claim one-third of a medical malpractice settlement or judgment awarded to a Medicaid patient. However, those in opposition claim the amount should be made on a case by case basis.

The case that has brought this issue to light involves a 12 year-old girl (she turns 13 next month) who is deaf, blind and almost completely immobile. Emily Armstrong suffered severe injuries at birth, causing her to have cerebral palsy. She requires 24-hour care.

The family sued the obstetrician and the medical center for damages exceeding $42 million. The obstetrician surrendered his North Carolina medical license. He has a history of drug use.

The family recovered $2.8 million in a 2006 settlement. The state of North Carolina imposed a lien on one-third of the settlement, which amounted to $933,333.33. The state claimed that it had already spent $1.9 million on Emily’s care.

While the federal Medicaid law prohibits state governments from imposing liens on patient’s property, a Supreme Court ruling said the rule only applies to the part of a settlement that doesn’t cover medical care, including payment for pain and suffering. In Emily’s case, the amount being paid for medical care and the amount being paid for other purposes was not specified.

“How can you predict, particularly with a statute that wasn’t based on any empirical data, that 30 percent is normally the right amount?” asked Justice Sonia Sotomayor, the most persistent critic of North Carolina’s position. “You just picked it out of the air? You could pick 40, 50, 60. How do we draw the line?”

The answer to this case is expected to come in June. The results are important for Medicaid patients in North Carolina and other states.

Source: News Observer – http://www.newsobserver.com/2013/01/08/2591577/supreme-court-weighs-case-of-disabled.html

To speak with a medical malpractice lawyer in North Carolina for more information, contact Kelly & West today.