Medicare and Medicaid liens must be resolved before you disburse a personal injury settlement. Fax MSPRC (the Medicare Secondary Payer Recovery Contractor) proof of representation and procurement-cost requests to 1-833-844-1540. Reach OHCA’s Third-Party Liability unit at (405) 522-6205 for Medicaid subrogation. Both liens are collateral sources, and Medicare’s carries federal double-damages exposure if you disburse first.
A client with Medicare or Medicaid means two lien-resolution workflows alongside the liability claim: the Medicare conditional payment process through MSPRC, and OHCA’s Third-Party Liability subrogation claim. Neither lien is self-executing, and disbursing before either is satisfied creates personal exposure. This reference from Hasbrook & Hasbrook covers the contacts, workflow steps, and allocation arguments that reduce what you pay. It does not cover private hospital or physician liens; for those, see challenging defective hospital and physician liens.
Quick Reference: MSPRC and OHCA Contacts
| Entity | Purpose | Phone / Fax | Portal / Mail |
|---|---|---|---|
| Medicare COB Contractor | Initial claim notification (Coordination of Benefits) | 855-798-2627 | N/A |
| MSPRC (Medicare recovery) | Proof of Representation and procurement-cost requests | Fax 1-833-844-1540 | MSPRP Portal |
| OHCA Third-Party Liability | Subrogation inquiry; lien calculation; general TPL info | Lien line (405) 522-6205; TPL info fax 530-3478; lien-calc fax 530-3404 | liens@okhca.org |
| OHCA Check Authorization | Post-settlement check sign-off only | Fax 405-530-3444 | N/A |
Confirm current contacts before relying on them (see oklahoma.gov/ohca.html); agency numbers change. The subrogation-inquiry fax (530-3404) and the check-authorization fax (530-3444) reach different OHCA units, and sending to the wrong one delays your case.
Resolving the Medicare Conditional Payment Lien
Liability insurance pays first when a claim is pending. Medicare pays conditionally while the claim is pending, then asserts a recovery right against your settlement. MSPRC, the recovery contractor, is distinct from the Coordination of Benefits Contractor that handles initial notice; you will deal with both.
- Screen at intake. Ask about Medicare status (age 65+, or SSDI) and get the Medicare HIC number before the first treatment entry.
- Notify the COB Contractor at 855-798-2627 to open the Medicare file; document the call and confirmation number.
- Establish representation. Fax the client’s Consent to Release and your Proof of Representation to MSPRC at 1-833-844-1540. Until both are received, MSPRC deals only with the beneficiary directly.
- Audit the conditional payment itemization once representation is confirmed. Dispute unrelated charges in writing, with records, before a final demand issues; disputes are harder to win afterward.
- Request the procurement cost reduction at settlement by faxing MSPRC your settlement statement, fee percentage, and total costs to 1-833-844-1540, or you pay the full conditional payment amount.
- Pay the final demand before disbursing. Federal law imposes double-damages exposure on anyone who disburses before a Medicare conditional payment lien is satisfied.
CMS does not require or review formal Medicare Set-Asides in liability settlements; that framework applies only to workers’ compensation (WCMSAs). In catastrophic cases compensating future medical needs, document that Medicare’s future interest was considered when the settlement was structured.
Resolving the Medicaid Subrogation Claim (OHCA)
Oklahoma’s Medicaid program is administered by the Oklahoma Health Care Authority. Like the Medicare lien, OHCA’s Third-Party Liability claim is not self-executing.
- Screen at intake for any current or past Medicaid coverage and get the client’s OHCA ID.
- Send a subrogation inquiry to OHCA TPL with a signed PHI authorization, date of injury, and nature of injury. Plan for a 30-day response; actual turnaround often runs closer to 10 days.
- Compare OHCA’s itemization against your medical timeline and challenge unrelated charges in writing.
- Get authorization to sign the settlement check before you deposit it, a separate step attorneys often miss.
- Disburse and forward OHCA’s net recovery within the window you committed to, and keep proof of delivery.
Reducing the Lien: Allocation and the Make-Whole Doctrine
Medicare and Medicaid pay only for past medical care; neither has a claim to future medical expenses, lost wages, or pain and suffering. Present MSPRC and OHCA with a documented settlement allocation, consistent with your demand letter and mediation history, breaking out past medical, future medical, lost income, and general damages.
Under 12 O.S. § 994.2, OHCA’s recovery is reduced proportionally by the procurement costs, including attorney fees and case costs, attributable to the recovery; the worksheet in 12 O.S. § 994.3 sets out the computation. 12 O.S. § 994.1 was formally repealed after Douglas v. Cox Retirement Properties, Inc., 2013 OK 37, struck the 2009 tort-reform package it belonged to on logrolling grounds, leaving 994.2 and 994.3 to govern OHCA’s proportional recovery alone. For how a Medicaid lien ranks against other claims on the same recovery, see how competing liens are ordered in an Oklahoma settlement.
Under the make-whole doctrine, a subrogee’s right to recover is subordinate to the client being fully compensated for the loss. It is a recognized Oklahoma equitable principle, strongest against the state-law OHCA lien; its use against the federal Medicare lien is contested, with some federal circuits finding preemption and others allowing it. Raise it in policy-limits cases where full compensation is doubtful.
Paid-Not-Incurred Billing and the Lien Exception
Medicare and Medicaid payments are collateral sources; the defendant gets no credit for them. Under 12 O.S. § 3009.1, medical bills are generally limited at trial to the amount actually paid, not billed. But if a provider has filed a lien for more than the amount paid, the excess, up to the lien amount, is admissible, keeping the billed amount in play for a provider holding a statutory lien under 42 O.S. § 43. Coordinate lien strategy with your damages presentation.
In Kratz v. Kratz, 1995 OK 63, 905 P.2d 753, the Oklahoma Supreme Court held that hospital liens under 42 O.S. § 43 do not attach to uninsured motorist proceeds. Some practitioners press the same reasoning for Medicare and Medicaid liens when a settlement mixes liability and UM/UIM proceeds; that question is unresolved for government liens, and Medicare preemption complicates it further, but it is worth raising where UM/UIM proceeds are a significant share of the recovery. For the full framework, see our paid-versus-billed medical damages analysis.
Common Pitfalls
| Pitfall | Consequence | Prevention |
|---|---|---|
| Missing Medicare or Medicaid status at intake | Lien discovered at settlement, too late to contest unrelated charges or negotiate allocation | Ask at intake; complete Medicare and Medicaid forms before the first treatment entry |
| Disbursing before the Medicare final demand is paid | Double damages exposure under 42 U.S.C. § 1395y(b)(3) | Do not disburse until the MSPRC final demand is received and satisfied |
| Skipping the procurement cost reduction request | Paying Medicare’s full conditional payment amount, not the reduced net figure | Send MSPRC the procurement fax with your settlement statement, fee percentage, and total costs |
| Signing or depositing a settlement check without OHCA authorization | Exposure for the full OHCA subrogation amount | Fax 405-530-3444 and wait for written authorization before signing |
| Client files bankruptcy while the case is pending | Medicare recovery rights may interact with the bankruptcy discharge and estate | Disclose the PI claim and consult bankruptcy counsel before settlement |
