Florida Court Refuses to Opine as to Whether an LMSA is Needed or Not

Medicare Set-Aside Blog on February 8, 2013
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To date there have been two bodies of case law involving MSAs:  those where both sides stipulate to the same MSA and seek approval from the district court in lieu of CMS since not available, and those cases where parties are looking to enforce a settlement agreement because there is some disagreement about the MSA. This week we add to that mix a case where the parties cannot agree as to whether an LMSA is needed or not and agreed to let the district court decide for them. 

The case involves Carnival Cruise line, making this their second reported MSP related opinion [See May 2012 post for Bruton v. Carnival]. Guess the cliché of cruises being for old people is proving to be true. The case settled in mediation in November 2012 on the condition that the court retain jurisdiction to potentially enforce the settlement and determine the issue of a possible MSA, if any. The parties were able to agree to the undisclosed sum, that each would bear their own attorneys’ fees, that Carnival would pay the mediator, that plaintiff would execute a release, and while they could not agree on the MSA issue, agreed to submit the issue to the court to decide. Plaintiff believed it is not a requirement whereas Carnival wanted an MSA. 


Because the parties do not have a complete settlement agreement here, there is nothing the court could or was willing to do to assist. The court may not write in terms of a settlement, just as it will not issue an advisory opinion. Because there is no agreement to enforce, the court ordered the mediator’s report and joint stip for dismissal stricken and returned the case to the trial docket. Poor Carnival really wants to protect Medicare’s interests but just can’t get any love from the courts. 


So while unfortunate that we cannot get a judicial opinion on the matter, the outcome is the right one. An MSA is a risk management tool to prevent future potential Medicare recovery actions. It is not an express statutory or regulatory requirement at this time and may never become one given that we are trying to assess damages on something that hasn’t happened and may never happen. I have no doubt that the statute permits Medicare to make payments post-settlement for which it would be entitled to reimbursement, but there are several factors that could potentially limit the nature and extent of that occurrence. Only parties to the settlement have the ability to agree what do to in the event that the situation arises at some point in the future. And the sooner that everyone finally realizes that we hold the power to control this situation, the easier this issues will be to resolve in all settlements.





2013 U.S. Dist. LEXIS 16711

February 07, 2013, Decided