Posted by: Ryan Weiner on Jul 26, 2017

Contributed by Med Lien Solutions

Most people don’t know the difference between a lien, subrogation rights, and rights of reimbursement. Those who do know the difference often don’t care. For instance, even our industry refers to a Medicare lien; however, Medicare does not (technically) put liens on your cases. Medicare liens are actually Medicare-rights-to-reimbursement and subrogation rights. But that’s a mouthful. So we, and most lien resolution providers, use the term lien. Furthermore, because these blog posts are meant to simplify lien resolution processes in an educational manner, we often do just that: simplify.

Subrogation: A legal technique under common law by which one party steps into another’s shoes. Normally, this involves the insurer (I) stepping into the shoes of the injured party (P) so as to have the benefit of P’s rights and remedies against a third-party such as a defendant (D). This means that the (I) could act as a plaintiff in a suit against (D), or even intervene in (P)’s suit against (D). Most private insurers have rights of subrogation written into their contracts.

Lien: A claim, encumbrance, or charge on property for payment of some debt, obligation or duty. The most obvious lien involves a mortgage. However, in healthcare liens, the idea of a mortgage is somewhat incomparable. The property in this situation is a settlement. The encumbrance is a piece of paper (titled “Lien”) that prevents distribution prior to lien satisfaction, or payment.

The Medicare Super Lien: Medicare’s right-to-reimbursement is often referred to as a “Super Lien.” This is because it takes precedence over all other payment rights (although plaintiff attorneys’ fees are factored as procurement costs and allowed in full).

Please understand that we may use certain terms interchangeably. The terms and titles are much less important than the actual procedures. In fact, Medicare’s agencies claim to use more than 4,500 acronyms and terms. Also note that regardless of whether you’re dealing with a lien, subrogation, or other rights to reimbursement, the outcome will be the same – you must protect your clients’ rights and resolve the “lien.”

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