Medicare and Medicaid Liens on a New Mexico Injury Settlement

By the FigureMyTax Editorial Team · How we calculate

When New Mexico Medicaid pays your care, the department is subrogated to your right against a third party to the extent of its payments, and common law equitable reimbursement principles can also apply. The statute gives no attorney-fee formula. Medicare recovers under federal rules.

Subrogation

NMSA 27-2-23(B) says that when the department makes medical assistance payments for a recipient, it is subrogated to any right the recipient has against a third party for recovery of medical expenses to the extent it has paid. The department must make reasonable efforts to find liable third parties.

Health plans and equitable reimbursement

Health insurers, including self-insured plans, must accept the state's right of recovery. Nothing in the section precludes applying common law principles on equitable reimbursement from any third-party source to the state or a health insurer. The federal government is entitled to a share of amounts the state recovers (27-2-24).

No fee formula

We found no New Mexico section that says attorney fees come off first or gives the department a fixed share. Ask the department for an itemization and a written reduction. The calculator lets you enter the percentage you expect it to accept.

Federal limit and Medicare

In Arkansas Department of Health and Human Services v. Ahlborn (2006), the U.S. Supreme Court held that Medicaid may reach only the portion of a settlement that represents medical costs. Under the Medicare Secondary Payer statute, 42 U.S.C. 1395y(b)(2), the United States may recover conditional payments and collect double damages from responsible entities; 42 CFR 411.24 governs recovery, and 42 CFR 411.37(c) reduces Medicare's recovery by its procurement-cost share. On a $100,000 settlement with $36,333 of fees and costs, $15,000 of Medicare payments would shrink to about $9,550.

Next steps

See how hospital liens work and what New Mexico courts say about health plan reimbursement, then enter every claim in the New Mexico medical lien calculator.

This is general information, not legal advice, and the state comparisons above are illustrative, not an exhaustive survey. Confirm how New Mexico's rules apply to your specific case with a licensed New Mexico attorney.