This article has been published in “The Advocate”, a monthly publication of the Arizona Association for Justice/Arizona Trial Lawyers Association, July – August 2014 issue, @2014 by Steven J. Bruzonsky, Esq.
July/August 2014 Lien Updates
FEHBA Liens – Meridian Suspends Collection of FEHBA Liens for BCBS in Arizona:
Several of our AzTLA members have received letters from Meridian, the subrogation collector for BCBS FEHBA health insurance plans, stating as follows: “As you may know, inKobold v. Aetna Life Ins. Co., No. 1 CA-CV 12-0315. 2013 Ariz. App. LEXIS 187 (Ariz. Ct. App. Sept. 5, 2013), the Arizona Court of Appeals issued a ruling that the Federal Employees Health Benefits Act does not preempt Arizona’s state anti-reimbursement laws. Accordingly, we have voluntarily suspended efforts to obtain reimbursement recoveries on behalf of the Blue Cross Blue Shield Service Benefit Plan in Arizona unless and until the Kobold decision is reversed or the law is otherwise changed.” We understand that Rawlings, the subrogation collector for Aetna, had similarly suspended its efforts regarding FEHBA lien collection. However, since that time, on May 8, 2014, the Arizona Court of Appeals issued an order staying the Kobold mandate/order that returns the case to the trial court for ninety (90) days from the date of the order. Attorney David Abney, handling the Kobold appeal for the injured plaintiff, advises that the stay on issuance of the mandate does not affect the Kobold opinion’s validity or controlling nature; that as the Arizona Supreme Court denied the petition for review, Kobold is the substantive law of the State of Arizona (that there is no federal preemption and Arizona anti-subrogation case law applies to FEHBA lien claims); and that Kobold will remain the substantive law of the State or Arizona unless and until Congress amends the FEHBA or the U.S. Supreme Court accepts a petition for writ of certiorari and then reverses the Arizona Court of Appeals. I understand from a fellow AzTLA member that in his FEHBA lien case, the FEHBA subrogation collector, post the May 8th stay, has requested that the attorney continue to hold the FEHBA lien funds in Trust pending the duration of the stay order. I imagine this may well be occurring in other FEHBA liens cases as well.