• Speegle v. Harris Methodist Health System & Harris Methodist Fort Worth
  • April 6, 2010 | Authors: Matthew T. Fornataro; Arthur N. Lerner
  • Law Firm: Crowell & Moring LLP - Washington Office
  • In 2001, Appellant Larry Speegle sustained injuries from an automobile accident with another vehicle and subsequently received treatment at Harris Methodist Hospital. The cost of Speegle's treatment at Harris Methodist totaled $142, 915.01. On June 29, 2001, Harris Methodist filed a notice of hospital lien for the entire cost of its services. Though Speegle was a Medicare beneficiary, Harris Methodist did not bill or receive payment from Medicare for his treatment. Several years later, Appellant entered into a Compromise Settlement Agreement and Release with the other party involved in the accident. The Agreement provided for the payment of Harris Methodist's lien in full. However, Speegle did not pay the Hospital the amount of the lien and instead sought a declaration that Harris Methodist's lien was invalid under Texas law because Harris Methodist did not bill Medicare for Speegle's treatment.

    The Court found that Medicare's secondary payer provisions "expressly prohibit" Medicare from paying a claim "if a liability carrier has already paid or is reasonably expected to pay promptly." The associated regulations define "promptly" as within 120 days. Additionally, the Court found that "after the 120-day 'promptly' period ends, whenever services provided to a Medicare beneficiary are also covered by a liability insurance policy, providers can choose either to bill Medicare or to maintain a lien. Therefore, the Court held that Harris Methodist's lien was valid and it could thus recover the lien amount from Speegle.

    The applicable Texas Statute, contrary to Federal law, does require medical care providers to bill Medicare for services received by Medicare eligible patients when providers are permitted. But the Court ruled that the Texas Statute was preempted by the Medicare secondary payer provisions.