MSA Company Not Liable for Underfunding MSA

CMS, Jen Article, Medicare Set-Asides, Work Comp on August 26, 2016 | Posted by Kimberly Wiswell, CMSP

All these years later and Mr. Bindrum is still mad about his 2008 settlement with AIG. Today an unpublished opinion was reported out of the State of Vermont that shows that after his unsuccessful suit against AIG in federal court for wrongfully delaying his settlement while waiting on CMS approval during the backlog years and cheating him out of half a million in unfunded future medicals as determined by his MSA consultant [Bindrum v. Am. Home Assurance Co., 441 Fed. Appx. 780 (2d Cir. 2011)], Mr. Bindrum took a run at AIG in state court. But interestingly he added defendant’s MSA provider NuQuest to the list of defendants this time around. On motion to dismiss, the Superior Court dismissed several counts, but let the claim against NuQuest to go forward. It appears that Mr. Bindrum pled that as a third-party beneficiary to the contract between NuQuest and AIG, they owed him a duty to obtain a much higher WCMSA approval from CMS. Unfortunately, it was CMS that ruined his claim as the settlement was contingent on CMS approval and it was the amount approved by CMS that was ultimately funded by AIG. Furthermore, CMS stated in its approval letter that it would fund any shortfalls beyond its approved amount, therefore Mr. Bindrum was not harmed in any way whereas the same may not be true for Medicare. Given that he failed to demonstrate any actual increased need for additional medical care or any reason to believe the MSA was underfunded other than his MSA vendor told him he needed more, the dismissal from state court has been affirmed and MSA vendors nationwide can breathe a sigh of relief.

 

Bindrum v. Am. Home Assur. Co.

Supreme Court of Vermont

August, 2016, Term

SUPREME COURT DOCKET NO. 2016-042

2016 Vt. Unpub. LEXIS 150