August 05,2005

Grassley Praises Use of Statute to Protect Medicare Dollars


To: Reporters and Editors
Re: Medicare as secondary payer statute
Da: Friday, Aug. 5, 2005

Sen. Chuck Grassley, chairman of the Committee on Finance, led the effort to clarify theMedicare as secondary payer statute in 2003 as part of the Medicare Modernization Act. The changemade clear that citizens can bring lawsuits in federal court on behalf of Medicare against parties whomay have injured Medicare beneficiaries and incurred taxpayer expenses to treat those beneficiaries.

Prior to the clarification, legal practitioners were confused over who exactly could bring a case under the statute. Under the statute, the parties who cause injury to Medicare beneficiaries are intended to be the primary payer to treat that injury; Medicare as a taxpayer-funded program is meant to be thesecondary payer. Now, the United Seniors Association has filed a lawsuit under the statute againstthe major tobacco companies. Grassley made the following comment on the Medicare as secondarypayer statute.

“I can’t comment on the substance of this case, but I can talk about the value of the Medicareas secondary payer law. Medicare is taxpayer-funded, and the taxpayers aren’t a cash cow. Theirresources, and by extension, Medicare’s resources, are limited. If someone offers a product or service that injures people and drives up Medicare’s costs, Medicare deserves a fair chance to fight back. That’s what the Medicare as secondary payer law offers. Now that Congress has strengthened thesecondary payer law, I hope the courts will accept the statute as an effective tool against undeservedMedicare expenses.”