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She received MVA settlements as POA when her dad was in the hospital. We are in Florida. My ex-husband passed away July 2014 at age 70 after an April 2014 MVA which paralyzed him. Medicare paid his hospital bills. The at fault insurance and UM insurance paid policy limits to my daughter , now age 33, very quickly after the accident. She was POA for him at that time. Now MERC is trying to demand it back. It is gone and has been gone for 3 years. My daughter was diagnosed with a serious mental illness this past year. She doesn't understand the letters written to the "Estate" and can't even support herself. I am providing her existence in my home. When her father died, there was no estate, no will, no probate. What should she/I do?

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Yes she would be responsible for paying that money back to Medicare. Medicare paid those bills and the settlement monies from the MVA insurance provider should have been used to reimburse  Medicare. 
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Yes, it’s due to Congress passing a “Secondary Payor Act” regarding recovery of the costs Medicare paid, if these costs are later paid by another and included in the settlement. It was a part of the whole Bush era DRA - deficit reduction act - group of legislation. I think although drafted in 2005, it didn’t get signed in till 2009. It’s somewhat different than Medicaid’s Estate recovery -which existed before DRA but was updated & more defined within DRA - as Medicare is federal so it’s a public law; while Medicaid’s estate recovery is done by the states as Medicaid gets administrated by each state uniquely. 

Ideally What should have happened was for the atty handling the lawsuit to have placed settlement funds in an escrow like account for a period of time to allow for any subsequent claims by others (like Medicare) to be dealt with & paid. The tally paid by Medicare would be in CMS (centers for Medicare & Medicaid) records & sends out statements to your ex’s mailing address monthly detailing what was paid and to whom & if there’s a copay.

If there wasn’t an atty, then the Medicare recipient is responsible for secondary payers. There is paperwork that was signed by whomever got the check that states that the funds will be distributed in compliance for medical insurers policy terms (so it indemnifies the auto insurance co). If she did it as his dpoa, then the fiduciary duty shifts to her. She spent the $ that was paid in 4 mos & cannot account for where & how spent for her dads needs..... is that basically the situation? And she’s not able to understand what responsibility means, as well, right? If that’s it, your daughter needs to have an attorney to deal with this. I’d suggest you set up an appt with a NAELA level of elder law atty. it may not be the type of work they do but can review & give you a referral to a specialist. 
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