Short Answer

Yes. In North Carolina, Medicare (CMS) must be repaid from a personal injury settlement, but you can often reduce what CMS claims. You can dispute unrelated charges, receive an automatic reduction for attorney’s fees and case costs, and request a waiver or compromise based on fairness or hardship. Do not pay until CMS issues a Final Demand; you typically have 60 days to pay it to avoid interest.

Understanding the Problem

You’re a North Carolina injury claimant who received a Medicare letter about a lien, and it says “do not send payment at this time.” You want to know if you can negotiate what Medicare will take from your settlement. This question matters because CMS has a legal right to reimbursement, and insurers and attorneys usually won’t disburse settlement funds until the Medicare claim is resolved.

Apply the Law

Under North Carolina law and federal Medicare rules, CMS has a priority reimbursement right from liability settlements when it paid “conditional” medical bills for your injury. State lien caps don’t limit Medicare’s recovery. The main forum is CMS’s Benefits Coordination & Recovery Center (BCRC) through the Medicare Secondary Payer Recovery Portal. After settlement, CMS issues a Final Demand; payment is generally due within 60 days, and you typically have about 120 days to appeal the amount. Procedures and timelines can change, so check current CMS instructions.

Key Requirements

• Report and verify the claim: Make sure CMS has your injury claim details so it creates a conditional payment summary.
• Challenge unrelated charges: Dispute any bills not caused by the accident or that another insurer already paid.
• Procurement-cost reduction: CMS reduces its recovery by a pro‑rata share of your attorney’s fees and case costs.
• Final Demand before payment: Wait for CMS’s Final Demand; then pay within 60 days to avoid interest.
• Waiver/compromise options: You can ask CMS to further reduce or waive recovery based on equity, hardship, or collection considerations.

What the Statutes Say

• North Carolina Gen. Stat. § 44-49 (Medical provider liens) - Recognizes providers’ liens on injury recoveries; separate from Medicare’s federal rights.
• North Carolina Gen. Stat. § 44-50 (Distribution with liens) - Sets how settlements are divided when provider liens exist; does not limit Medicare’s separate claim.
• North Carolina Gen. Stat. § 108A-57 (Medicaid subrogation) - State Medicaid recovery rules; related concept but different from Medicare’s federal process.

Analysis

Apply the Rule to the Facts: Your “do not send payment” letter is typically a conditional payment notice, not a bill. You can and should review CMS’s itemized charges and dispute any that are unrelated to the accident. When CMS issues the Final Demand, it will apply a reduction for your attorney’s fees and costs. If the demand still seems too high or would cause hardship, you can ask CMS for a further waiver or compromise.

Process & Timing

1. Who files: The injured Medicare beneficiary (or your attorney). Where: CMS’s Benefits Coordination & Recovery Center via the Medicare Secondary Payer Recovery Portal. What: Report the claim, review the Conditional Payment Letter, and file disputes for unrelated charges. When: Do this before settlement or promptly after, so the record is clean.
2. After settlement: Report settlement details through the portal; CMS issues a Final Demand with its reduced amount reflecting attorney’s fees/costs. You may appeal the amount or request waiver/compromise (typically within about 120 days for an appeal).
3. Payment: Pay the Final Demand within 60 days of the bill date to avoid interest and collections. Keep proof of payment for your file and any insurer requests.

Exceptions & Pitfalls

• Unrelated charges: Don’t pay for treatment that isn’t accident-related—dispute these items before Final Demand.
• Paying too early: Don’t send money after a preliminary letter; wait for the Final Demand.
• Interest and collections: Missing the 60-day window can trigger interest and referral to collections.
• Different programs: Medicare Advantage (Part C) or Part D plans may assert separate recoveries with their own processes.
• Disbursement delays: Insurers and attorneys often require proof of CMS resolution before releasing full settlement funds.

Talk to a Personal Injury Attorney

If you're dealing with a personal injury settlement and a Medicare lien, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.