Medicare and Medicaid Liens on a Wisconsin Injury Settlement

By the FigureMyTax Editorial Team · How we calculate

When Wisconsin recovers public assistance from a third party, reasonable costs of collection, including attorney fees, are deducted first. Federal law limits Medicaid to the portion of a settlement that represents medical costs. Medicare recovers under federal rules.

How the recovery is computed

Wis. Stat. 49.89(5) says reasonable costs of collection, including attorney fees, shall be deducted first. The department of health services receives the rest of the recovery, up to what it paid. The statute also covers control of the action, incentive payments to counties and reporting.

Assignment and subrogation

The recipient's assignment of rights and the department's subrogation for medical assistance are in section 49.45(19), which an annotation to 49.89 identifies. We did not read it, so ask the department for an itemization and how it counted your fees.

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 how Wisconsin's made-whole rule works for health plans, then enter every claim in the Wisconsin medical lien calculator.

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