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November 04, 2022

Second Circuit Upholds Private Right of Action for Medicare Advantage Plans under MSP Statute

In Aetna v Big Y Foods, Inc.,the Second Circuit joined the Third and Eleventh Circuits in holding that Medicare Advantage (MA) plans have a private right of action to collect coordination of benefits overpayments under the Medicare Secondary Payer (MSP) statute.

An MA beneficiary suffered an injury at a supermarket operated by Big Y Foods, and her MA plan through Aetna paid in part for her medical care. The case involves the MA plan’s efforts to obtain recovery of those payments from Big Y Foods on the grounds that it was a self-insured “primary plan” under the MSP statute. The question before the court was whether the MSP statute’s private right of action is available to MA plans. The Court ruled that the MA plans have an enforceable right to seek redress under the statute directly. 

The Court rejected Big Y’s argument that a private right of action for MA plans serves no purpose other than increasing the profits of such plans, finding that blocking access of MA plans to the private right of action would be inconsistent with the intent of the legislation. The Court also noted that the PAID Act of 2020 indicated Congress was aware that MA plans were using the private cause of action and did not seek to curtail its use. 

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