Beyond State Lines: A Creative Subrogation Win

A Native American Indian tribe, through their TPA, secured a recovery by using The Phia Group’s subrogation services when the plan member’s attorney refused to acknowledge the Plan’s right of recovery from the proceeds of a third-party liability settlement. More specifically, a plan member was injured as a result of a motor vehicle accident outside of the tribal lands in a state that recognized the “made whole doctrine.” The doctrine is a legal concept recognized by some states that requires the member to have been compensated in full for their damages before a health plan may seek recovery from the proceeds of a third-party settlement.

The plan member was employed by the tribe as an ambulance driver for the ambulance service available exclusively on the tribal land. The member was not a tribal member, nor an employee of the commercial establishment operated by the Plan. Therefore, the plan member did not qualify as a member of the traditional tribal plan or the self-funded ERISA plan available to employees of the tribe’s commercial enterprises. The member’s attorney argued that state law applied, citing that the member had not been made whole and refused to reimburse the Plan. The Phia Group’s subrogation experts jumped in and argued the plan’s right of recovery was in fact controlled by the sovereignty of the tribe and not subject to state law. The Plan’s recovery rights in this circumstance were unsettled in the courts. However, The Phia Group’s subrogation expert secured a recovery of $125,000.00 for the Plan.

By partnering with The Phia Group, the client saved $125,000.00 through Phia’s creative legal theory of recovery.