Another New Spin in the MAO Class Actions

Medicare Advantage, Medicare Set-Aside Blog, MSP Litigation, MSP News on October 26, 2017 | Posted by Jennifer Jordan, JD, MSCC

MAO-MSO Recovery II, LLC, et al., v. Boehringer Ingelheim Pharmaceuticals, Inc., et al. was dismissed for lack of standing on October 10, 2017. In this latest MSP private cause of action stemming from the Florida Health Care Plus assignment, this claim sought recovery from the Predaxa MDL settlement that occurred in May 2014. Predaxa is a blood thinning drug that caused some to develop life-threatening internal bleeding.  Plaintiffs first notified Defendants of their reimbursement rights on or about June 1, 2016, over two years later.

As in its other cases, Plaintiff essentially argued that Defendants should have known that related payments were made by MAOs and because simply not reimbursed, are now subject to double damages as a matter of law because the settlement triggered MSP liability and they allegedly own the recovery right. Defendants argued that Plaintiffs failed to show an injury in fact given that Plaintiffs did not allege:

  1. the identity of the assignor,
  2. the identity of the assignor’s enrollee,
  3. the type of treatment paid for on the enrollee’s behalf,
  4. the specific amount of medical bills paid by the assignor,
  5. that the enrollee was a party to the MDL settlement,
  6. that the Defendants knew of the assignor’s payments at the time it paid the funds into the Settlement Fund, and
  7. that the assignors requested that Defendants reimburse them and that Defendants refused.

While those arguments were not effective, challenging the undisclosed alleged assignments was. Plaintiffs alleged that they have valid assignments from MAOs other than FHCP, but as in other related litigation, they failed to provide the identity of the MAOs whose reimbursement rights they claim to own, the dates of the assignments, or the essential terms. Although a facial challenge to the amended complaint only requires “general factual allegations of injury resulting from the defendant’s conduct” be accepted as true, the court does not accept legal conclusions which is all plaintiffs presented. Because they failed to show they’ve suffered an injury in fact, the court found that they lacked standing to proceed. Unfortunately the court dismissed without prejudice meaning that plaintiff is free to file a second amended complaint.

So now we’ve seen MSP private causes of action in PIP stemming from auto accidents, med-pay from property insurance claims, global claims against larger insurers for all MSP transgressions and now pursuit of an MDL settlement. Just a matter of time before they figure out how to craft a workers’ compensation suit.

 

Recovery v. Boehringer Ingelheim Pharms.
2017 U.S. Dist. LEXIS 174940
United States District Court for the Southern District of Florida
October 10, 2017, Filed
Case No. 1:17-cv-21996-UU