Faced with rising litigation costs and unpredictable juries, it is understandable that many product liability litigants – on both sides of the courtroom – eventually think about settlement in lieu of trial. In cases involving catastrophic injury, however, staggering medical expense liens often control the feasibility of reaching an acceptable agreement.

Some lawyers have long dreaded settlement negotiations when Medicare is the major lien holder because Medicare can be the proverbial 800-pound gorilla at the table. Unfortunately, with the enactment of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (“MPDIMA”) the gorilla has only gotten bigger. To have any chance at taming the Medicare beast, lawyers on both sides need to understand the reach of a Medicare lien, as well as potential avenues for reducing or eliminating Medicare’s interest in the settlement proceeds.

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