Medicaid Liens on Settlement Limited under 2018 Act

John Darer • February 16, 2018

Medicaid Can Now Only Recover Portion of Settlement Allocated to Medical Costs

Medicaid Lien on Settlements

Section 53102of the Bipartisan Budget Act of 2018,fully repeals Medicaid's expanded third-party recovery rights. Now, Medicaid can only seek reimbursement from a portion of the settlement allocated to medical costs . Medicaid cannot recover monies from lost wages, pain and suffering or any other damages awarded to the injured party.

The law was passed in February 2018 and signed in to law by President Trump.This is good news for anyone handling a personal injury, medical malpractice, product liability case or other legal case with a Medicaid lien and means that more dollars can be allocated to the injured party.

A provision included in Section 202(b) of the Bipartisan Budget Act of 2013, had created an expansion of third-party recovery rights allowing Medicaid to recover from the entire settlement, not just the medical portion. That legislation had been postponed several times until finally taking effect in October 1, 2017, raising questions about its impact on the structured settlement outcomes for claimants, who risked losing their entire settlements.

The 2018 Act effectively resets the standard for Medicaid lien recovery to the standard of Arkansas DHHS v. Ahlborn , a Supreme Court ruling in 2006 and Wos v. E.M.A. , another Supreme Court ruling in 2013, affirming Ahlborn, which limited recovery claims by state Medicaid against tort settlement to only amounts allocated for medical costs, or a state framework that provided a set portion for recovery.




USAA structured settlements
By John Darer July 16, 2025
USAA Life Insurance Company, an A++ rated insurance company, issues structured settlement annuities with 1%, 2% and 3% COLAs. USAA Life structured settlements are exceptionally compatitive on lifetime benefit payments with long duration certain periods for ages under 35.
MetLife Structured Installment Sales Now Available in New York
By John Darer July 8, 2025
Owners of highly appreciated NY businesses or NY real estate may benefit from a structured installment sale tax deferral program as an alternative to a 1031 exchange. MetLife's structured installment sale program is now available in NY and in all 50 states. Call 888-325-8640 for more info
what is a qualified assignment
By John Darer July 8, 2025
A qualified assignment is part of the process to establish a structured settlement that enables a Defendant, Insurer, or Qualified Settlement Fund, to achieve a complete novation of the future periodic payment claim established by suit or agreement, through a substitution of obligors.
structured settlement annuity
By John Darer July 2, 2025
An annuity and a structured settlement walked into a bar, how do you tell them apart? 4structures' John Darer reviews the differences for you right here.
lifetime structured settlement annuity lake tahoe
By John Darer July 2, 2025
A lifetime structured settlement annuity turns part of your settlement recovery  into guaranteed income you can’t outlive that is contractually guaranteed by a regulated life insurance company. A lifetime annuity is sometimes referred to as longevity insurance.
Budgeting and Settlement Planning
By John Darer July 1, 2025
Structured settlement annuities can be very helpful to the budgeting process by providing guaranteed income streams and deferred lump sum payments tailored to specific budget needs and time frames identified in the settlement planning process.
secondary market annuity
By John Darer June 28, 2025
Structured settlement receivables are often deceptfully marketed to investors as annuities. When the originating structured settlement factoring company buys structured settlement payments in a structured settlement factoring transaction, they are buying a receivable not an annuity.
constructive receipt structured settlement
By John Darer June 21, 2025
Avoid constructive receipt if a structured settllement or structured attorney fee is to be established. Care must be taken to avoid constructive receipt.
USAA Life Insurance Company structured settlements
By John Darer June 9, 2025
Financial services provider USAA ranks 94th on Fortune 500. USAA Life Insurance Company, which earns the top rating of A++ from AMBest is often super competitive on longer term payment streams.
Prudential Income Advantage Indexed Structured Settlement Annuity
By John Darer June 2, 2025
John Darer reviews Prudential Income Advantage structured settlement annuity, which provides indexed structured settlement annuity option with the potential to grow personal injury settlement funds while offering protection from market declines. 2 IRS Private Letter Rulings!
More Posts