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Steven J. Bruzonsky

Attorney At Law

Law Office of
Steven J. Bruzonsky
917 E. San Angelo Ave.
Gilbert, AZ 85234
480-969-3003

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REDUCING AND DEFEATING LIENS


Following are some examples of how Attorney Bruzonsky has reduced and defeated lien claims both in his own Personal Injury and Wrongful Death Practice, and in his Personal Injury Lien Practice, in which he handles complex lien situations in personal injury, medical malpractice and wrongful death cases for other Arizona attorneys representing injured claimants. Amounts are approximate and may be rounded off.

 

A.R.S. § 33-931 healthcare provider liens:


If a hospital, doctor or other healthcare provider files a lien with the county recorder, the provider has a lien for its "customary" charges against the liability settlement. Attorney Bruzonsky has used various legal arguments to reduce and defeat these liens, including but not limited to (1) that the provider has already been paid its "customary" charges per in network health insurance contract and is not entitled to any further payment; (2) that the provider is required by the LaBombard case to reduce its balance billing amount (total amount billed less payments by health insurance) by procurement costs (percent of attorney's fees and costs divided by settlement amount); (3) that Federal law (Medicare, Medicare Advantage, Tri-Care, AHCCCS) and regulations prohibit balance billing and preempt Arizona law (which provides for balance billing by filing liens); (4) that the lien only applies to liability settlement proceeds, and the lien doesn't apply to uninsured or underinsured settlements; (5) that the lien is late filed and ineffective against the injury liability settlement; (6) that the settlement funds available are much less than the full value of the case, requiring equitable substantial reduction or waiver of the lien, and that the injured party may simply drop the claim unless this can be accomplished; and (7) that the lien is not enforceable against wrongful death settlements, under Arizona law, when the settlement is for the surviving spouse and/or children's damages and the settlement does not include the decedent's accident-related medical expenses; etc.


In one case, Attorney Bruzonsky was retained when the case was already three years old. The hospital charges were about $200,000 and a lien was filed. The attorney for the injured party advised that there was no employer provided health insurance. The hospital had initially determined that the patient, who was initially in a coma post-accident, had no health insurance. Attorney Bruzonsky re-investigated and determined that the patient had excellent health insurance through his employer; and this resulted in the hospital being paid nearly $80,000 in health insurance benefits. Once this was accomplished, Attorney Bruzonsky accomplished substantial further lien reduction.


Following are some examples of how Attorney Bruzonsky has been able to reduce and at times defeat A.R.S. § 33-931 healthcare provider liens. The lien amounts are the amount that the hospital, doctor or other healthcare provider claimed as a lien against the settlement, after any payment by health insurance.

  • $711,000 liens (2) reduced to $25,000 (for both liens)

  • $572,000 lien reduced to $14,010

  • $460,000 lien waived in its entirety

  • $450,000 lien reduced to $125,000

  • $237,000 lien reduced to $10,000

  • $210,400 lien reduced to $105,200

  • $194,000 lien reduced to $41,000

  • $173,000 lien reduced to $4,000

  • $160,000 lien waived in its entirey

  • $139,200 lien reduced to $40,950

  • $138,200 lien reduced to $10,000

  • $135,000 lien reduced to $30,000

  • $127,900 lien reduced to $40,000

  • $122,000 lien waived in its entirety

  • $119,000 lien reduced to $6,000

  • $110,000 lien waived in its entirety

  • $102,000 lien reduced to $2,500

  • $80,000 lien waived in its entirety

  • $78,800 lien waived in its entirety

  • $76,000 lien reduced to $20,000

  • $70,000 lien reduced to $20,000

  • $62,600 lien reduced to $5,700

  • $68,000 lien reduced to $20,000

  • $59,000 lien waived in its entirety

  • $52,300 lien reduced to $14,200

  • $48,000 lien reduced to $4,200

  • $47,000 lien reduced to $1,000

  • $46,700 lien reduced to $5,000

  • $42,500 lien reduced to $4,200

  • $39,700 lien reduced to $12,000

  • $39,000 lien waived in its entirety

  • $110,000 lien waived in its entirety

  • $37,600 lien waived in its entirety

  • $35,700 lien reduced to $10,800

  • $35,600 lien reduced to $7,000

  • $31,500 lien reduced to $13,500

  • $29,000 lien reduced to $1,500

  • $28,300 lien reduced to $10,000

  • $27,400 lien reduced to $4,000

  • $27,100 lien waived in its entirety

  • $27,000 lien waived in its entirety

  • $27,000 lien reduced to $600

  • $26,000 lien reduced to $1,500

  • $25,000 lien reduced to $1,500

  • $25,000 lien reduced to $6,000

  • $24,300 lien reduced to $3,000

  • $22,500 lien reduced to $7,500

  • $21,100 lien reduced to $14,100

  • $20,200 lien reduced to $5,200

  • $20,000 lien reduced to $300

  • $17,400 lien reduced to $8,000

  • $15,300 lien reduced to $1,250

  • $15,000 lien reduced to $3,800

  • $15,000 lien waived in its entirety

  • $12,900 lien waived in its entirety

  • $12,000 lien waived in its entirety

  • $11,700 lien reduced to $4,500

  • $10,600 lien reduced to $1,750

  • $10,250 lien reduced to $2,500

  • $10,200 lien reduced to $5,000

  • $9,200 lien waived in its entirety

  • $6,200 lien waived in its entirety

  • $5,700 lien reduced to $400

  • $5,100 lien reduced to $3,500

  • $3,600 lien reduced to $1,250

  • $2,500 lien waived in its entirety

  • $2,100 lien reduced to $570

 

Out of State Healthcare Provider Lien Claims:

  • $206,000  reduced to $36,600

 

 

Health Insurance Lien Claims (ERISA Liens):

 

Health insurers frequently claim that they have liens against settlement of personal injury claims. Attorney Bruzonsky has used various legal arguments to reduce and defeat these liens, including but not limited to (1) that the Summary Plan Description (SPD) doesn't include an applicable lien or subrogation provision; (2) that if either the SPD or the Master Plan (if there is one) do not have an applicable lien or subrogation provision, then there is federal case law that there is no lien; (3) that the employer's ERISA plan buys traditional premium based health insurance, so Arizona anti-subrogation case law applies and there is no lien; (4) that lack of an Administrative Services Contract between the employer's ERISA plan and the health insurance carrier that serves as the healthplan's Third Party Administrator (TPA) demonstrates that traditional premium based health insurance is involved, so Arizona anti-subrogation case law applies and there is no lien; (5) that plan provisions in some cases require reduction for procurement costs (percent of attorney's fees and costs divided by settlement amount, or that plan is silent regarding attorney's fees and costs such that the court will apply the procurement cost reduction when the contract is silent in this regard); (6) that the lien only applies to liability settlement proceeds, and the lien doesn't apply to uninsured or underinsured settlements, because plan language mentions "third party" liability and doesn't define this to include uninsured and underinsured settlements; (7) that the written plan provisions are silent or ambiguous regarding the application of certain equitable defenses and therefore those equitable defenses must be applied to reduce or waive the lien; (8) that the injured party will drop the claim unless equitable lien reduction or waiver is accomplished; and (9) that the lien is not enforceable against wrongful death settlements, under Arizona law, when the settlement is for the surviving spouse and/or children's damages and the settlement does not include the decedent's accident-related medical expenses; etc. On occasion ERISA short or long term disability lien claims are made as well, and there are additional legal basis to defeat or reduce such lien claims.


Following are some examples of how Attorney Bruzonsky has been able to reduce and at times defeat health insurance lien claims (ERISA liens).

  • $693,000 lien reduced to $175,000

  • $490,000 lien reduced to $162,000

  • $462,000 lien reduced to $40,000

  • $325,000 lien reduced to $32,500

  • $261,000 lien reduced to $15,000

  • $249,000 lien waived in its entirety

  • $200,000 lien waived in its entirety

  • $177,600 lien reduced to $42,000

  • $161,000 lien reduced to $40,000

  • $127,400 lien reduced to $10,000

  • $120,500 lien waived in its entirety

  • $88,100 lien reduced to $44,000

  • $80,000 lien reduced to $27,500

  • $79,000 lien reduced to $42,000

  • $70,000 lien reduced to $7,000

  • $58,400 lien reduced to $9,300

  • $57,000 lien reduced to $4,000

  • $50,000 lien reduced to $8,000

  • $48,900 lien reduced to $5,000

  • $47,700 lien reduced to $1,600

  • $47,000 lien waived in its entirety

  • $38,600 lien reduced to $10,000

  • $35,000 lien waived in its entirety

  • $33,800 lien reduced to $10,000

  • $33,100 lien reduced to $23,000

  • $30,000 lien waived in its entirety

  • $29,000 lien waived in its entirety

  • $20,000 lien (medical and short term disability) waived in their entirety

  • $18,500 lien reduced to $9,000

  • $14,000 lien reduced to $7,000

  • $12,800 lien reduced to $6,400

  • $10,000 (short term disability) lien waived in its entirety

  • $4,600 lien reduced to $2,000

  • $2,200 lien reduced to $1,100

    .

     

     

    A.R.S. §12-962 State or Political Subdivision Lien Claims:

     

    A.R.S. § 12-962 provides lien and subrogation rights for Arizona state or political subdivions, which include Arizona state departments or agencies (e.g., Arizona Department of Corrections), Colleges, and local school districts. Attorney Bruzonsky has used various legal arguments to reduce these liens, including but not limited to (1) that the lien only applies to liability settlement proceeds , and the lien doesn't apply to uninsured or underinsured settlements; (2) that if traditional premium based health insurance pays the accident-related medical benefits (as opposed to the state or political subdivision self-paying the medical benefits using a Third Party Administratort for this purpose), then the lien is inapplicable; (3) that to the extent stop loss health insurance pays the medical benefits, then the lien is inapplicable; (4) that the settlement funds available are much less than the full value of the case requiring equitable substantial reduction or waiver of the lien, or otherwise the injured party will drop or not settle the claim; (5) that the Arizona statutes have an anti-lien provision similar to the federal Medicaid anti-lien provision which requires pro rata lien reduction based on the total settlement divided by the case’s full value, and that Arizona appellate courts have yet to consider a state or political subdivision lien case where the injured party’s total settlement was less than, or even far less than, the injury claim’s full value; and (6) that the lien is not enforceable against wrongful death settlements, under Arizona law, when the settlement is for the surviving spouse and/or children's damages and the settlement does not include the decedent's accident-related medical expenses; etc.


    Following are some examples of how Attorney Bruzonsky has been able to reduce and at times defeat A.R.S. § 12-962 lien claims.

    • $2.4 million lien reduced to $480,000, with $1 million to be held in third party trust as credit for future incident-related medical benefits

    • $493,500 lien reduced to $185,000

    • $105,000 lien waived in its entirety

    • $67,300 lien reduced to $10,000

    • $28,000 lien reduced to $10,000

    • $18,300 lien reduced to $3,700

    • $14,000 lien reduced to $8,000

    :

     

    AHCCCS (Medicaid) Lien Claims:

             

    Federal law (42 U.S.C. § 1396a-1396u, Subchapter XIX) establishes Medicaid as a medical assistance program for eligible low-income individuals.  Federal funds are given to the states, which implement Medicaid to eligible state residents. The Arizona Medicaid system is AHCCCS (Arizona Health Care Cost Containment System) (36 A.R.S.§ 36-2901 through A.R.S. § 36-2998).  Federal law provides for Medicaid liens [42 U.S.C. § 1396a(a)(25) and 42 U.S.C. § 1396k(b)], and each state has its own laws implementing the liens (in Arizona, A.R.S. § 12-961 through § 12-964, in particular A.R.S. § 12-962; A.R.S. § 36-2915 and A.R.S. § 39-2916; and A.R.S. § 36-2956).  Attorney Bruzonsky has used various legal arguments to reduce these liens, including but not limited to (1) that if no A.R.S. § 36-2915 is timely filed (after notice of the injury claim or litigation is given to AHCCCS, as required by the statute), then the “automatic” A.R.S. § 12-962 lien only applies to liability settlement proceeds, and the lien doesn't apply to uninsured or underinsured settlements; (2) that the Arizona lien statutes mandate “equitable” lien reduction; (3) that the settlement funds available are much less than the full value of the case requiring equitable substantial reduction or waiver of the lien under the Ahlborn and Southwest Fiduciary cases, and/or that the injured party may simply drop the claim unless this can be accomplished; (4) that at a minimum, the AHCCCS lien statutes and theSouthwest Fiduciary case require that the "procurement cost" reduction (percentage of attorney's fees and costs divided by the total settlement amount) be given; and (5) that the lien is not enforceable against wrongful death settlements, under Arizona law, when the settlement is for the surviving spouse and/or children's damages and the settlement does not include the decedent's accident-related medical expenses; etc.


    Attorney Bruzonsky has been able to obtain reasonable AHCCCS lien reduction in every case, and in some cases, attorney Bruzonsky has been able to obtain very substantial AHCCCS lien reductions, with a few examples listed below:

    • $322,100 lien reduced to $59,500

    • $68,600 lien reduced to $28,100

    • $43,700 to $29,200

    • $43,400 to $17,400

    • $29,600 to $12,200

    • $21,600 lien reduced to $13,000 

    • $4,000 lien reduced to $1,200

     

    Medicare Advantage Lien Claims:


    Under current Federal law, private insurance carriers offer Medicare Advantage (MA) health insurance, which is a replacement for Medicare medical coverage. MA regulations state that MA insurers have the same lien rights against personal injury settlements as does Medicare. Attorney Bruzonsky has used various legal arguments to reduce and defeat these liens, including but not limited to (1) whereas Federal Medicare statutes give Medicare express lien or subrogation rights, Federal Medicare Advantage statutes only give MA insurers express reimbursement rights, so there is no Federal preemption of Arizona anti-subrogation case law; (2) there is no Federal court jurisdiction for Medicare Advantage lien claims; (3) Medicare Advantage lien claims filed in Federal court fail to state a claim under Federal law; (2) that if the Summary Plan Description (SPD) doesn't include an applicable lien or subrogation provision, then then there are no lien rights;(4) Since MA regulations refer to MA insurers having the same lien rights as Medicare, MA insurers must follow Medicare regulation and manual lien processing requirements, including mandatory reduction for procurement cost (percent of attorney's fees and costs divided by settlement amount), and consideration of further lien compromise or waiver upon request; (5) that the settlement funds available are much less than the full value of the case requiring equitable substantial reduction or waiver of the lien, and that the injured party may simply drop the claim unless this can be accomplished; (6) that the lien is not enforceable against wrongful death settlements, under Arizona law, when the settlement is for the surviving spouse and/or children's damages and the settlement does not include the decedent's accident-related medical expenses; etc.    

     

    Attorney Bruzonsky has been able to defeat and minimize Medicare Advantage lien claims. Following are a few examples of how Attorney Bruzonsky has been able to reduce and at times defeat Medicare Advantage lien claims .

    • $257,500 lien reduced to $12,500

    • $104,000 lien reduced to $24,000

    • $67,200 lien reduced to $5,000

    • $53,500 lien reduced to $15,000

    • $35,000 lien reduced to $8,700

    • $30,000 lien reduced to $1,500

    • $30,000 lien waived in its entirety

     

     

    Attorney Bruzonsky is a coauthor of the Arizona Association for Justice/Arizona Trial Lawyer's Association amicus curiae brief filed with the United States Court of Appeals for the Ninth Circuit in Parra v. Pacificare, 2011 U.S. Dist. LEXIS 33630 (March 28, 2011).  In this case, the U.S. District Court, Arizona dismissed Pacificare's Medicare Advantage lien claim, and then the Ninth Circuit Court of Appeals affirmed the dismissal..

     

     

    Medicare Lien Claims: Medicare Lien Claims:

     

    Medicare liens are well established under federal statutes, regulations and case law. Medicare by regulation automatically compromises or reduces the lien by Medicare's pro rata share of procurement costs (attorney's fees and costs). Although Medicare regulations provide discretionary authority for Medicare to compromise or reduce the lien by more than Medicare's pro rata share of procurement costs, or for Medicare to fully waive the lien, in practice this seldom occurs. A few examples follow of how attorney Bruzonsky has been able to obtain larger than pro rata  procurement costs compromise or reduction of some Medicare liens:

     

    • $176,100 lien reduced to $87,500

    • $139,500 lien reduced to $100,000

    • $78,200 lien reduced to $3,200

     

     

    FEHBA Lien Claims:


    FEHBA (Federal Employees Health Benefit Act) Lien Claims: FEHBA (Federal Employees Health Benefit Act) Lien Claims: Federal civilian civil service employees and their dependents obtain health insurance from a local health insurance carrier which contracts with the federal government to provide health insurance. Attorney Bruzonsky has used various legal arguments and strategies to essentially defeat these liens, including but not limited to (1) the Federal FEHBA statute gives no express lien lien or subrogation rights to FEBHA health insurers, such that there is no federal preemption of Arizona anti-subrogation case law; (2) there is no Federal court jurisdiction for FEHBA lien claims; (3) FEHBA lien claims filed in federal court fail to state a claim under Federal law. ;

     

    Attorney Bruzonsky has been able to defeat and minimize FEHBA healthplan lien claims so that little or nothing has been paid on them. As one of a number of examples, a recent FEHBA lien claim of $320,000 resulted in no payment on that lien claim.

 

 

Federal Medical Care Recovery Act Lien Claims:


 

Federal Medical Care Recovery Act (FMCRA) Liens are asserted by federal agencies, including military branches, Tri-Care, U.S. Public Health Service, Indian Health Service, and Veteran’s Administration for medical benefits paid and the reasonable cost of care in government facilities. Attorney Bruzonsky recently obtained substantial reduction of a Veteran’s Administration FMCRA lien from $325,000 to $170,000.

 

 

 

 

 

 

© Copyright 2006, Steven J. Bruzonsky, Attorney
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