Episode 10: Brain Injury Lawsuit Settlements and Medicaid

In this episode of Brain Injury Insider, host Michael Kaplen discusses how a settlement in a brain injury case can impact on an individual's ability to continue to receive Medicaid services.


If you are a brain injury survivor receiving brain injury related services through your state Medicaid program, and have a lawsuit pending for the negligence that caused these injuries, it's important that you listen carefully, and also ask your attorney to listen to this podcast.

Your ability to continue to receive Medicaid services, may seriously be impacted by any settlement that you receive.

Why is that? Because federal law requires that Medicaid be paid back for the services that they have provided to you as a result of your injury, from any settlement that you receive as a result of your lawsuit.

So what does that mean for your lawyer? It means that your lawyer carefully has to evaluate the amount of money that they are willing to accept in settlement of your case.

You need to be made aware of this payback by your lawyer. And you need to carefully look at Medicaid bills to see if they are related to your lawsuit and the injuries that you claimed in that lawsuit.

But just as important, your lawyer and you must understand that if you receive a sum of money in settlement of your lawsuit, it may affect your rights to future Medicaid benefits. Because Medicaid is a needs based test. Ability to obtain Medicaid benefits is based on your financial condition.

If you receive a sum of money as a result of your lawsuit, you may exceed the Medicaid threshold or income level. Which will make you ineligible for future Medicaid benefits.

So how does a lawyer go about protecting you to ensure that you continue to receive Medicaid benefits, and also to ensure that you receive the proceeds of your settlement?

Your lawyer must be familiar with something called a "Supplemental Needs Trust" or a "Special Needs Trust", which is available to individuals under the age of 65.

Instead of giving you your settlement proceeds directly, the money will be placed in a special trust to continue your eligibility for Medicaid benefits. And this trust will pay for services that Medicaid will not pay for.

Enhanced accommodations in your home, special transportation services, recreational services, therapeutic services that are not within the Medicaid gambit of services.

But you need to set up this Medicaid trust (or special needs trust) before you receive your funds. You need to know that you must pay Medicaid back for the past sums that they have paid on your behalf. And that if you create this trust, and if there is money left when you pass away, Medicaid still must be paid back.

But while you are alive, and you have properly notified Medicaid that you created this trust, you will be able to receive both Medicaid services, and these supplemental services that you so desperately need.

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Brain Injury Insider

michael kaplen

Brain Injury Insider is a weekly video update by The Brain Injury Law Firm ®. We cover the latest news and developments in traumatic brain injury, concussion, and brain injury law.


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