Settlement Enforced Despite Dispute on Medicare and Medical Lien Terms

by P. Czuprynski

In Smith v. Wal-Mart Stores E., LP.^[1], a claimant filed a complaint alleging that Wal-Mart and Vestis Services was negligent, resulting in a slip and fall. The claimant and Wal-Mart negotiated a settlement.

After a settlement was reached, Wal-Mart’s counsel sent an email advising of the settlement amount and that Walmart’s counsel would prepare the release. The email advised that there would be terms regarding confidentiality and indemnification along with terms that would not preclude the claimant from pursuing a claim against the co-defendant. Additionally, the claimant’s Medicaid/Medicare status and lien amounts (if any) were needed to finalize the release.

However, following this email, the parties could not come to an agreement regarding resolving medical liens and the Medicare Secondary Payer (MSP) Act. Wal-Mart appears to have wanted to take the lead to resolve the medical liens, but the terms were not acceptable by the claimant.

After a variety of proposed releases went back and forth, the claimant prepared their own release that included the terms identified in the email from defense counsel. The release contained indemnification regarding the medical liens and a confidentiality clause.

After the claimant signed the release, they filed a motion to enforce the agreement.

The Court found that the claimant complied with the conditions of the settlement agreement and executed a general release. Using the email from defense counsel, the court found that there was enough evidence to demonstrate an enforceable agreement. Wal-Mart was ordered to deliver a settlement check within three days.

While probably not the outcome Wal-Mart was expecting, they still have the ability to track a demand by Traditional Medicare through the Medicare Secondary Payer Recovery Portal. At a minimum, if Medicare asserted a lien, they could check the progress and confirm it was resolved.

Additionally, through Medicare’s query process, Wal-Mart could likely identify if there is a potential Medicare Part C or D plan involved. Since the Paid Act was implemented, data for the last three years of Medicare Part C and D is available through the query process.

While every settlement negotiation is different, and each claimant or carrier/self-insured has their own risk tolerances, we can still explore valuable takeaways from this case:

• • Establish protocols regarding how a carrier/self-insured wants to handle Medicare issues such as Medicare Set-Asides or conditional payment reimbursement.
  • Communicate these specifics at the outset of the settlement negotiations and honor them in the terms of settlement.
  • In this case, there appears to be a disconnect on what the parties each meant with respect to indemnification and lien handling. It is possible that the defense attorney’s intent was that Wal-Mart would handle the liens, but this intent did not appear in the email used by the court in determining its findings.

If you have any questions about the particulars of this case or would like to discuss strategies for resolving claims with medical liens further, please reach out to our Settlement Consulting team at [email protected].

^[1] 2025 U.S. Dist. LEXIS 251463 (S.D. Fla. Dec. 5, 2025)