MD Court Rules That MAP Assignments of Rights Did Not Violate Policy

August 12, 2025 / 18 min read

In an interesting new Medicare Advantage Plan decision out of Maryland, the Maryland Supreme Court in Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (Md. 2025)^[1]has ruled that MAO-MSO Recovery’s assignments of rights, which they received from several different Medicare Advantage Plans and other contractors to pursue Medicare reimbursement claims on their behalf, did not violate Maryland public policy.

gavel-and-sclaes-of-justice

Summary

As many may recall, last year in MAO-MSO Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), the plaintiffs, MAO-MSO Recovery, as an assignee of approximately 89 different Medicare Advantage Plans (MAPs) and other contractors, sued several defendant insurers seeking “double damages” under the Medicare Secondary Payer’s (MSP’s) private cause of action (PCA) statute. MAO-MSO Recovery alleged, in main part, that the defendant insurers failed to properly reimburse the MAPs and other contractors for payments they made in relation to various no-fault cases and liability settlements. In response, the defendant insurers moved to dismiss and for summary judgment arguing, in part, that the PCA statute did not apply to MAP recovery claims and that MAO-MSO Recovery’s assignments of rights violated Maryland public policy.

In June 2024, the United States District Court for Maryland ruled, in main part, that the MSP’s PCA statute applies to MAPs, and certain “first tier” and “downstream entities,” allowing them to sue insurers for “double damages” under the MSP’s PCA statute. As part of this decision, the district court asked the Maryland Supreme Court to determine whether MAO-MSO Recovery’s underlying assignments of rights, which they received from the MAPs and other entities to pursue their recovery claims, violated Maryland public policy.

Per the district court’s request, the Maryland Supreme Court has now weighed in on this question. Specifically, in Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (Md. 2025) the Maryland Supreme Court has ruled that MAO-MSO Recovery’s assignments of rights do not violate Maryland public policy. Very generally, in reaching this decision, the court found that the nature of the assignments at issue did not violate Maryland’s barratry statute, or the common law doctrines of champerty and maintenance, which, in certain circumstances, historically have prohibited third parties from pursuing or maintaining legal actions for another party in certain situations.

With the Maryland Supreme Court having addressed the assignments question, the focus now shifts back to the U.S. District Court for Maryland, which may now consider whether to lift the stay it imposed pending the Maryland Supreme Court’s decision thereby allowing the parties to continue litigating the underlying issues before this court. In this regard, it will be interesting to see how the district court may ultimately rule regarding whether a “double damages” award against the defendant insurers is warranted based on the facts, and how it may address the plaintiff’s subrogation claim. Likewise, it will be interesting to monitor how the court may rule on the defendants’ statute of limitations argument. From another angle, it is unknown if the defendant insurers will appeal any aspect of the district court’s ruling to the United States Fourth Circuit of Appeals (which has, in part, jurisdiction over federal cases originating from Maryland).

Going forward, insurers with Maryland claims may wish to keep the district court’s ruling in MAO-MSP Recovery II, LLC v. Government Employers Ins. Co. in mind when considering how to address Medicare Advantage recovery claims to avoid potential “double damages” actions.

In the interim, please see our Medicare recovery services page to learn more about how Verisk can help you address CMS, Treasury, Medicare Advantage, and Part D conditional payment claims from ad-hoc (case by case) referrals to our more holistic CP Link® program which provides a proactive approach to Medicare recovery claims that leverages your Section 111 data to initiate the conditional payment process.

For those interested in a more in-depth analysis of this case, and how Verisk can help you address Medicare Advantage Plans recovery claims, the following overview is presented:

Background

MAO-MSO Recovery, as an assignee of approximately 89 different Medicare Advantage Plans (MAPs) and other contractors, sued several defendant insurers seeking “double damages” under the Medicare Secondary Payer’s (MSP’s) private cause of action (PCA) statute^[2]alleging, in main part, that the insurers failed to properly reimburse the MAPs for payments they made in relation to various no-fault cases and liability settlements.^[3]The defendant insurers moved to dismiss MAO-MSO Recovery’s claims and also sought summary judgment on grounds that (1) MAO-MSO Recovery did not have the right to pursue their claims under the MSP’s PCA provision; (2) MAO-MSO’s assignments violated Maryland public policy; and (3) many of MAO-MSO Recovery’s claims were time barred.^[4]

U.S. District Court for Maryland’s 2024 ruling

In June 2024, the U.S. District Court for Maryland, in MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024) ruled, in main part, that MAPs, and certain “first tier” and “downstream entities,”^[5]can in fact sue insurers for “double damages” under the MSP statute’s PCA provision.^[6]The court further ruled that the plaintiffs could pursue its MSP subrogation claim against the defendant insurers.^[7]The court, however, declined to address the defendant insurers’ statute of limitations argument stating that “[b]ecause resolution of this issue would not be dispositive of all claims and may not be necessary, the Court declines to address it at this time. The Motion will be denied without prejudice as to this issue.”^[8]

The district court asked the Maryland Supreme Court to address whether MAO-MSO Recovery’s assignments of rights violate Maryland public policy

As part of its June 2024 ruling, the U.S. District Court of Maryland also asked the Maryland Supreme Court to address whether MAO-MSO Recovery’s underlying assignments of rights received from the MAPs and other contractors to pursue their recovery claims violated Maryland public policy.

In this regard, the district court certified the following three questions to the Maryland Supreme Court: “(1) whether it is the current fundamental public policy of Maryland to prohibit schemes to stir up and promote litigation for the benefit of the promoter rather than for the benefit of the real party in interest; (2) if there is such a public policy, what are the specific terms of such a public policy; and (3) if there is such a public policy, whether it is sufficiently strong that any agreement that violates it cannot be enforced by courts in Maryland, regardless of any choice-of-law provision contained in the agreement.” MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *14.^[9]

Further, the district court put a hold on any additional action before it until the Maryland Supreme Court addressed the certified questions stating that “these cases case will be stayed pending the resolution of the certification process” by the Maryland Supreme Court.^[10]

The Maryland Supreme Court rules that MAO-MSO Recovery’s assignments of rights do not violate Maryland public policy

Pursuant to the district court’s certification request, the Maryland Supreme Court recently addressed this matter in Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (July 11, 2025).

Per its review, the Maryland Supreme Court reformulated the certified questions for its determination as follows:

Whether the assignment of the right to seek and receive unpaid reimbursement of payments for expenses under 42 U.S.C. § 1395y(b)(3)(A) (2018) pursuant to a contingency compensation arrangement/agreement is void as against public policy of Maryland, and if so, whether such an arrangement/agreement is unenforceable regardless of any choice of law provision contained in such an agreement. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (July 11, 2025), at *1.

For the reasons outlined below, the court found that MAO-MSO Recovery’s assignments did not violate Maryland public policy and, accordingly, it declined to answer the second part of the question.

The court’s ruling and reasoning are outlined, in general, as follows:

1. The Maryland Supreme Court rules that MAO-MSO Recovery’s assignments did not violate Maryland’s barratry statute.

The court noted that the defendant insurers argued that “Maryland has a narrow, but fundamental, modern public policy against schemes to promote litigation for the benefit of the promoter rather than the benefit of the real party in interest. GEICO contends that this policy derives from the common law doctrines of maintenance, champerty, and barratry, as well as from Maryland’s misdemeanor criminal statute entitled ‘barratry,’ which prohibits certain types of solicitation relating to litigation.”^[11]

As noted above, the defendant insurers contended, in part, that MAO-MSO Recovery’s assignments violated Maryland’s barratry statute (Md. Code. Ann., Bus. Occ. & Prof. (“BO&P”) 10-604(b)(1)).^[12] The court noted that “[a]s pertinent here, [Maryland’s] barratry statute provides: ‘Without an existing relationship or interest in an issue ... a person may not, for personal gain, solicit another person to sue or to retain a lawyer to represent the other person in a lawsuit[.] BO&P § 10-604(b)(1).’”^[13]In response, MAO-MSO Recovery contended, in part, that their assignments are not void as against Maryland public policy, arguing that BO&P § 10-604(b)(1) does not bar the assignment of claims.^[14]

In rejecting defendant insurers’ argument, the court interpreted Maryland’s barratry statute as not prohibiting “all litigation-related solicitations for personal gain” and that “[w]ith respect to a solicitation to file a lawsuit, the statute only reaches a solicitation of ‘another person[.]’”^[15]

Applying this statute to the facts, the Maryland Supreme Court ruled, in part, as follows:

Here, Plaintiffs did not solicit any Medicare Advantage Organizations or other secondary payers to sue GEICO. Rather, Plaintiffs obtained the right to bring suit against GEICO in Plaintiffs’ own names by obtaining assignments of secondary payers’ claims. Given the plain language of BO&P § 10-604(b)(1), we conclude that Plaintiffs did not violate the barratry statute by obtaining those assignments. Accordingly, the assignments cannot be void as against any public policy furthered by Maryland’s barratry statute. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8.

2. The Maryland Supreme Court rules that MAO-MSO Recovery’ assignments did not violate Maryland’s common law.

From another angle, the defendant insurers also argued that MAO-MSO Recovery’s assignments were void under the common law doctrines of maintenance, champerty, and barratry. Very generally, as described by the court, “maintenance” is helping another prosecute or defend a suit, “champerty” involves maintaining a suit in exchange for a financial interest in the outcome, while “barratry” involves the continuing practice of maintenance or champerty, with these practices designed to prohibit the officious stirring up of litigation in which a person does not have an interest.^[16]In response, MAO-MSO Recovery argued, in part, that these doctrines have been obsolete for centuries and that the court should retire these “archaic” doctrines.^[17]

The court rejected the defendant insurers’ argument ruling that “to the extent the Maryland common law prohibitions against maintenance, champerty, and barratry continue to reach conduct that is not covered under BO&P § 10-604(b)(1), Plaintiffs’ assignments do not violate those doctrines.”^[18]

On this question, the court embarked on a lengthy historical review of these doctrines charting their origins back to ancient Greece, and then discussing their development through medieval England, and English statutory and common law, noting certain legal and societal concerns these doctrines were aimed to prevent. The court also noted that the framers of Maryland’s State Constitution adopted the common law of England as it existed on July 4, 1776, which included the “English common law offenses of maintenance, champerty, and barratry.”^[19]

As part of its argument, the defendant insurers argued that MAO-MSO Recovery’s assignments were void as against Maryland public policy based on Accrued Financial Services, Inc. v. Prime Retail, Inc., 298 F.3d 291 (4th Cir. 2002). As explained in general by the Maryland Supreme Court, in Accrued the United States Circuit Court of Appeals for the Fourth Circuit voided the assignments at issue based on champerty from what it viewed as “‘Maryland’s strong public policy against the stirring up [of] litigation or promoting litigation for the benefit of the promoter rather than for the benefit of the litigant or the public.’”^[20]In voiding the assignments in this case, the Fourth Circuit found that they were ‘’schemes to promote litigation for the benefit of [Accrued] rather than for the benefit of the litigant or the public.’”^[21]

As part of the Fourth Circuit’s ruling in Accrued, the Maryland Supreme Court noted that the Fourth Circuit had interpreted and relied, in part, on the Maryland Supreme Court’s decision in Son v. Margolius, Mallios, Davis, Rider & Tomar, 349 Md. 441, 457, 709 A.2d 112 (1998) to arrive at the conclusion that, very generally, “’the current fundamental public policy of Maryland prohibits schemes to stir up and promote litigation for the benefit of the promoter rather than for the benefit of the real party in interest.’”^[22]Of note, the Maryland Supreme Court noted a dissenting judge in Accrued took a contrary position stating that “’Maryland’s common law on maintenance, champerty, and barratry appears to be tending toward obsolescence because, as far as I can tell, Maryland has not used these common law doctrines to invalidate any contract in the last one hundred years.’”^[23]

On this latter point, the Maryland Supreme Court, as part of its historical analysis, referenced its 1868 decision in Schaferman v. O’Brien, 28 Md. 565, 574 (1868), noting how the court in this older case had commented that it was unaware of any case in the history of Maryland that had enforced the provisions of an old English statute that prohibited champerty.^[24]Referencing Schaferman, the court in MAO-MSO noted that “[o]ur predecessors recognized that the common law doctrines of maintenance and champerty were rooted in a ‘state of society’ that did not exist in Maryland and were incompatible with the increasing acceptance of assignable claims (or ‘choses in action’).”^[25]

Expanding on this point, the court noted that “[t]hese observations resonate only more strongly today. Apart from the Fourth Circuit’s decision in Accrued, we are unaware of any case in which a cause of action has been sustained, or a contract voided, based on Maryland common law related to maintenance or champerty.”^[26]Further, the court cited another Maryland Supreme Court case which noted that “’[w]hen an offense has lain virtually dormant for over two hundred years, it is difficult to argue that the preservation of society and the maintenance of law and order demand recognition of it.’”^[27]

Accordingly, the Maryland Supreme Court, concluded that “[t]o the extent the Accrued Court read Son to support the proposition that ‘surviving common law principles’ concerning maintenance, champerty, and barratry undergird a public policy that invalidates assignments similar to those at issue here, we disagree.”^[28]In addition, the court noted that “to the extent Maryland retains a policy under common law that prohibits a scheme ’to stir up and promote litigation for the benefit of the promoter rather than for the benefit of the real party in interest[,]’Accrued, 298 F.3d at 299 [court’s emphasis], that policy, at least in general, does not apply to litigation conducted by an assignee.”^[29] In addition, the court referenced other Maryland cases noted by the defendant insurers in which those courts considered whether the contracts at issue in those cases should be invalidated as a product of maintenance, champerty, or barratry. However, the court noted, in part, that while the courts in these other cases did not necessarily indicate that the viability of these doctrines had eroded, they had declined to invalidate the assignments in question under these doctrines based on the facts.^[30]Further, looking outside of Maryland, the court also noted “there seems to be a trend toward doing away with these common law doctrines.”^[31]

While the court noted that “these common law prohibitions are teetering on obsolescence,” it stopped short of abrogating them outright, noting that “in different circumstances … an agreement might far exceed accepted practice that it raises public policy concerns warranting judicial intervention.”^[32]

The court found no such policy concerns in the dispute between MAO-MSO Recovery and the defendant insurers, stating as follows:

Here, there is no such concern. Plaintiffs obtained assignments from secondary payers that allowed them to seek reimbursements allegedly owed to the secondary payers by primary payers like GEICO. While GEICO may prefer that Plaintiffs be prevented from pursuing these claims, Maryland public policy does not prevent sophisticated parties like Plaintiffs and the assignors from striking a bargain they both deem valuable. Put another way, Plaintiffs’ assignments are not sufficiently ‘officious’ as to warrant invalidation. And it certainly is not the case that litigation designed to recover reimbursement of Medicare payments is useless. Because we conclude that an assignment of the right to seek and receive unpaid reimbursement of payments for expenses under 42 U.S.C. § 1395y(b)(3)(A) by way of a contingency compensation agreement is not void as against public policy, we need not address whether, if such a policy existed, it would affect the enforceability of the assignment’s choice-of-law provision. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *11.

Thus, based on its analysis, the Maryland Supreme Court ruled that MAO-MSO Recovery’s assignments of rights it received from the MAPs and other contractors did not violate Maryland’s public policy.

What’s next?

With the Maryland Supreme Court finding that MAO-MSO Recovery’s assignments are valid, the focus shifts back to the U.S. District Court for Maryland, and most likely the district court will at some point consider lifting the stay it issued which would allow the parties to continue litigating the underlying issues before this court. In this regard, it will be interesting to see how the district court may ultimately rule regarding whether a “double damages” award against the defendant insurers is warranted based on the facts and how it may address the plaintiff’s subrogation claim. Likewise, it will be interesting to monitor how the district court may rule on the defendants’ statute of limitations argument. From another angle, it is unknown if the defendant insurers will appeal any aspect of the district court’s ruling to the United States Fourth Circuit of Appeals (which has, in part, jurisdiction over federal cases originating from Maryland).^[33]The Verisk policy team will continue to monitor events on these fronts and provides updates as warranted.

Compliance Considerations

In the big picture, based on the U.S. District Court for Maryland’s 2024 decision noted above, Maryland joins a growing number of states in which U.S. District Courts have similarly found that MAPs can sue insurers for “double damages” under the MSP’s private cause of action (PCA) statute.^[34]

As more fully discussed in our prior article, the district court in its 2024 decision acknowledged that the United States Fourth Circuit Court of Appeals (which has, in part, jurisdiction over federal cases originating from Maryland) has not yet addressed the issue of whether the MSP’s PCA statute applies to MAPs.^[35]Noting no precedent from the Fourth Circuit, the district court found persuasive, and agreed with, the rulings and analysis of the Second, Third, and Eleventh Circuit Courts of Appeals which have previously found that MAPs can sue insurers for “double damages” under the PCA.^[36] On this point, the district court ultimately agreed with the reasoning and conclusions of these Circuit Courts of Appeals that the MSP’s PCA statute is available to MAPs stating, in main part, that “[t]he Court finds that [MAPs] may invoke the private right of action under § 1395y(b)(3)(A) because there is ‘no basis to exclude [MAPs] from [this] broadly worded provision that enables a plaintiff to vindicate harm caused by a primary plan’s failure to meet its MSP primary payment or reimbursement obligations.’”^[37]

Thus, going forward, insurers with Maryland claims may wish to keep the district court’s ruling in MAO-MSP Recovery II, LLC v. Government Employers Ins. Co. in mind when considering how to address Medicare Advantage recovery claims to avoid potential “double damages” actions.

For additional information on MAP recovery, please see our recent article, Medicare Advantage and Part D Plans – 5 Things to Know and How Verisk Can Help and our State-by-state guide to Medicare Advantage in the courts resource.

How Verisk can help

Verisk offers several different Medicare recovery services that can help you address CMS, Treasury, Medicare Advantage, and Part D conditional payment claims from ad-hoc (case by case) referrals to more holistic approaches. On this latter point, we offer our popular CP Link® program which provides a proactive approach to Medicare recovery claims that leverages your Section 111 data to initiate the conditional payment process. CP Link helps speed up the conditional payment process by identifying potential conditional payment claims through Section 111 data, helps reduce adjuster time, and facilitates a holistic compliance approach to address conditional payment claims.

In addition, our PAID Act Add-on for CP Link utilizes the PAID Act data to provide an automated, customizable solution for identifying and resolving Medicare Advantage (Part C) and Part D (RX drugs) recovery claims—to facilitate improved compliance and risk mitigation. By combining automation with our experienced team, we consistently deliver extraordinary savings for our customers. For example, in 2024, our Medicare Advantage services delivered over $1.7 million in savings for our customers, while our CP Link program achieved over $160 million in conditional payment savings.

Questions?

Please do not hesitate to contact the author if you have any questions regarding the above, or how Verisk can help you address Medicare recovery claims.

[1] At the time this article was drafted, the court’s written opinion contained the following note at the beginning of its opinion: “Notice: This opinion has not been released for publication in the permanent law reports. Until released, it is subject to revision or withdrawal.” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (Md. 2025).

[2] The MSP’s private cause of action statute is codified at 42 U.S.C. 1395y(b)(3)(A) which states, in full, as follows: “There is established a private cause of action for damages (which shall be in an amount double the amount otherwise provided) in the case of a primary plan which fails to provide for primary payment (or appropriate reimbursement) in accordance with paragraphs (1) and (2)(A).” Id.

[3] MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *2. With respect to the assignments, the district court noted: “In the present cases, Plaintiffs have received assignments of the rights to payment from 89 Assignors. With some exceptions, these agreements include identical or substantially similar provisions establishing a contingent compensation arrangement under which the client receives a percentage of any recovery obtained from claims pursued by Plaintiffs, and Plaintiffs keep the remainder of the proceeds. Based on these assignments, Plaintiffs have filed the present cases, consisting of two putative class actions against the GEICO Defendants under the MSP Provisions and the relevant implementing regulations.” Id.

[4] MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *3. Very generally, regarding the defendant insurers’ motion to dismiss, the defendants also made several technical arguments challenging the plaintiffs’ standing based on allegations that the plaintiff’s improperly named the defendant insurer entities and other grounds unrelated to the Medicare Secondary Payer issues which are not the focus of this article. See generally, MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *4-6.

Regarding “first tier” or “downstream entities,” the court defined these terms as follows: “As defined by CMS regulations, a ‘first tier entity’ is ‘any party that enters into a written arrangement, acceptable to CMS, with an [MAO] to provide administrative services or health care services for a Medicare eligible individual under the MA program,’ and a ‘downstream entity’ is ‘any party that enters into a written arrangement, acceptable to CMS, with persons or entities involved with the MA benefit, below the level of the arrangement between an [MAO] and a first tier entity.’ 42 C.F.R. § 422.2 Such entities can incur financial costs associated with making conditional payments or reimbursing MAOs for their conditional payments. See MSP Recovery Claims, Series LLC v. ACE Am. Ins. Co., 974 F.3d 1305, 1314 (11th Cir. 2020). The GEICO Defendants assert that any conditional payments made by such entities are made pursuant to contracts with MAOs, not with CMS, so these entities have no statutory remedy to seek recovery for those payments. The GEICO Defendants cite no authority for this argument other than a district court case that was later abrogated by the United States Court of Appeals for the Eleventh Circuit. Mot. at 25 (citing MSPA Claims I, LLC v. Infinity Prop. & Cas. Grp., 374 F. Supp. 3d 1154, 1163 (N.D. Ala. 2019), abrogated by MSP Recovery Claims, v. ACE Am. Ins. Co., 974 F.3d 1305, 1315 (11th Cir. 2020)). MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *9.

[5] MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *2. Regarding “first tier” or “downstream entities,” the court noted that “[a]s defined by CMS regulations, a ‘first tier entity’ is ‘any party that enters into a written arrangement, acceptable to CMS, with an [MAP] to provide administrative services or health care services for a Medicare eligible individual under the [MAP] program,’ and a ‘downstream entity’ is ‘any party that enters into a written arrangement, acceptable to CMS, with persons or entities involved with the [MAP] benefit, below the level of the arrangement between an [MAO] and a first tier entity.’” Id.

[6] In addressing this question, the court acknowledged that the United States Fourth Circuit Court of Appeals (which has, in part, jurisdiction over federal cases originating from Maryland) has not yet addressed the issue of whether the MSP’s PCA statute applies to MAPs.MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *7. Noting no precedent from the Fourth Circuit, the court found persuasive, and agreed with, the rulings and analysis of the Second, Third, and Eleventh Circuit Courts of Appeals which have previously found that MAPs can sue insurers for “double damages” under the PCA. See, Aetna Life Insurance Company v. Big Y Foods, Inc., 52 F.4^th (2^nd Cir. 2022), In re Avandia, 685 F.3d 353 (3rd Cir. 2012), and Humana v. Western Heritage Insurance Co., 832 F.3d 1229 (11th Cir. 2016). Id. While the court’s detailed analysis of these decisions is beyond this article’s scope, the court ultimately agreed with the reasoning and conclusions of the Second, Third, and Eleventh Circuits that the MSP’s PCA statute is available to MAPs stating, in main part, that “[t]he Court finds that [MAPs] may invoke the private right of action under § 1395y(b)(3)(A) because there is ‘no basis to exclude [MAPs] from [this] broadly worded provision that enables a plaintiff to vindicate harm caused by a primary plan’s failure to meet its MSP primary payment or reimbursement obligations.’” MAO-MSP Recovery II, LLC, 2024 WL 2924063 at *9, citing Humana v. Western Heritage Insurance Co., 832 F.3d 1229, 1238 (11th Cir. 2016).

Regarding “first tier” and “downstream entities,” the court found “instructive” the United States Eleventh Circuit Court of Appeals’ ruling in MSP Recovery Claims, Series LLC v. ACE American Insurance Co., 974 F.3d 1305 (11th Cir. 2020). In ACE, the court noted that Eleventh Circuit rejected the argument that first tier and downstream entities lack the ability to sue under the PCA because they make conditional payments per contractual obligations. On this point, the court referenced the Eleventh Circuit’s conclusion that “’when a downstream actor bears the cost of an MAO’s conditional payments, that downstream actor suffers an injury squarely within the ambit of the Medicare Secondary Payer Act.’” MAO-MSP Recovery II, LLC, 2024 WL 2924063 at *9, citing ACE, 974 F.3d at 1316. Based on the ACE decision, the court ruled that “the private right of action … is available to first tier and downstream entities.” MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *9. In reaching this conclusion, the court found that “the plain language of the [PCA] provision does not restrict the private right of action to any particular category of individuals or plaintiffs” and that “[w]here first tier and downstream entities are linked to the Medicare program through the [MAPs], and they may incur financial injury as a result of a ‘primary plan’ failing to ‘provide for primary payment (or appropriate reimbursement).’” Id.

[7] On this point, the court rejected the defendant insurers’ argument that the plaintiffs’ direct right of recovery for breach of contract and subrogation claim under 42 C.F.R. § 411.24 (e) and 42 C.F.R. § 411.26 failed as a matter of law. MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *10. Section 411.24 (e) states as follows: “Recovery from primary payers. CMS has a direct right of action to recover from any primary payer.” 42 C.F.R. § 411.24 (e). Meanwhile, Section 411.26 is entitled “Subrogation” which, the court notes, states that “’[w]ith respect to services for which Medicare paid, CMS is subrogated to any individual, provider, supplier, physician, private insurer, State agency, attorney, or any other entity entitled to payment by a primary payer.’” MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *10. The court described Plaintiffs’ claim as follows: “The theory appears to be that they have the right to sue the No-Fault Action Defendants for breach of contract, because based on the relevant insurance policies, the policyholders have a breach of contract claim against the No-Fault Action Defendants for failing to pay for their medical expenses pursuant to the no-fault provisions, and the Assignors have subrogation rights to assert the contractual rights of those policyholders that they have assigned to the No-Fault Plaintiffs.” Id. While a review of the court’s detailed analysis into these regulations (and other MSP and MAP statutory provisions discussed) is beyond the scope of this article, the court, in general, found that while the above regulations on their face do not demonstrate that they apply to MAPs, based on the language contained in 42 C.F.R. § 422.108(f), “the rights that an [MAP] may exercise to recover from a primary plan include CMS’s subrogation right contained in 42 C.F.R. § 411.26.” Id. Thus, in rejecting the defendant insurers’ argument, the court stated: “[W]here [MAPs] already have a statutory private right of action under 42 U.S.C. § 1395y(b)(3)(A), the extension to [MAPs] of the same range of rights relating to the recovery of payments from primary providers, including rights relating to subrogation that arguably may facilitate recovery, can be fairly construed as within the purview of § 1395w-26(b)(3), which was aimed at preventing states from imposing their own rules on [MAPs] that would limit their ability recover. The Court therefore finds within § 1395y(b)(3)(A) and § 1395w-26(b)(3) sufficient statutory authority for 42 C.F.R. § 422.108(f). Because that regulation, in conjunction with 42 C.F.R. § 411.26, grants subrogation rights to secondary-payer [MAPs], the Court will deny [the defendant insurers’ motion to dismiss] the No-Fault Action.” MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *11.

[8] MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *14.

[9] It is also noted that the district court entered a subsequent order on July 10, 2024 referencing the certified questions as follows: “(a) Whether it is the current fundamental public policy of Maryland to prohibit schemes to stir up litigation for the benefit of the promoter rather than for the benefit of the real party in interest; (b) If there is such a public policy, what are the specific terms of such a public policy; and (c) If there is such a public policy, whether it is sufficiently strong that any agreement that violates it cannot be enforced by courts in Maryland, regardless of any choice-of-law provision contained in the agreement.” MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 6078716 (D. Maryland, July 16, 2024). The author notes there are slight differences in the wording of the certified questions between the district court’s June decision and its July 10, 2024 decision. In the big picture, these differences were slight and became irrelevant as the Maryland Supreme Court ultimately reformulated and reworded the certified questions as part of its review as noted in the body of the article above.

[10] MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *14.

[11] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *2.

[12] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *3.

[13] Id. at *8.

[14] Id. at *3.

[15] Id. at *8.

[16] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *4. On this point, the court stated as follows: “The common law doctrines of maintenance, champerty, and barratry were designed to prohibit ‘the officious stirring up of ... litigation in which a person had no interest[.]’ Son v. Margolius, Mallios, Davis, Rider & Tomar, 349 Md. 441, 457, 709 A.2d 112 (1998). Although these doctrines have been defined in various ways, put simply: ‘maintenance’ was helping another prosecute or defend a suit; ‘champerty’ was maintaining a suit in exchange for a financial interest in the outcome; and ‘barratry’ was the continuing practice of maintenance or champerty. In re Primus, 436 U.S. 412, 424 & n.15, 98 S.Ct. 1893, 56 L.Ed.2d 417 (1978).” Id.

[17] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *3.

[18] Id.

[19] Id. at *5, citing Md. Const. Declaration of Rights, art. 5(a)(1).

[20] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8, citing, Accrued Financial Services, Inc. v. Prime Retail, Inc., 298 F.3d 291, 300 (4th Cir. 2002). Briefly, in the Accrued case, the court noted that Accrued had entered into agreements with commercial tenants in outlet shopping malls to review their leases for discrepancies between costs charged by their landlords and those permitted by their leases. Accrued, at 294-295. Under those agreements, the tenants assigned any potential legal claims to Accrued, authorizing it to “contact, negotiate, and settle” with the landlords, file lawsuits if necessary to recover overcharges, and retain 40 to 50 percent of any recovery. Id. As referenced above, the court noted that “[t]he Fourth Circuit concluded that the assignments violated ‘Maryland’s strong public policy against stirring up litigation’ and were therefore void and unenforceable.” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8, citing, Accrued Financial Services, Inc. v. Prime Retail, Inc., 298 F.3d 291, 300 (4th Cir. 2002).

[21][Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8, citing, Accrued Financial Services, Inc. v. Prime Retail, Inc., 298 F.3d 291, 300 (4th Cir. 2002). On this point, the court noted that the court in Accrued “[i]n reaching this conclusion … emphasized several features of the transactions between Accrued and the assigning tenants. First, Accrued had no preexisting connection to the claims it pursued. Second, the assignors were unaware of potential claims until Accrued conducted audits. Third, Accrued exercised exclusive control over recovery decisions, including whether and how to pursue litigation, without regard to the tenants’ informed wishes. Finally, Accrued’s compensation depended entirely on identifying and successfully pursuing claims.” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8, citing, Accrued Financial Services, Inc. v. Prime Retail, Inc., 298 F.3d 291, 297-98, 299 (4th Cir. 2002).

[22] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8.

Regarding Son, the Maryland Supreme Court noted that the plaintiff, Son, was a Korean immigrant with limited English proficiency who was seriously injured in a car accident. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, referencing Son, 349 Md. at 447, 709 A.2d 112. The plaintiff’ spouse entered into a fee-based arrangement with a consultant to the Korean community, who agreed to help find an attorney to pursue a personal injury case on behalf of Son. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, referencing Son, at 447-49, 709 A.2d 112. Son later challenged the law firm’s payment to the consultant out of the proceeds of the settlement of his case. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, referencing Son, at 443-44, 709 A.2d 112. Son claimed, in part, that the consultant and the law firm had violated Maryland’s barratry statute. With respect to the consultant, the statute made it a misdemeanor for a person, ‘[w]ithout an existing relationship or interest in an issue ..., for personal gain, [to] solicit another person to sue or to retain a lawyer to represent the other person in a lawsuit[.]’” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, Son, at 444, 456-57, 709 A.2d 112 (quoting BO&P § 10-604(a)(1) (1995 Repl. Vol.)).” The statute also made it a misdemeanor for a lawyer to engage in certain litigation-related conduct. Similar to the prohibition that applied to non-lawyers in section 10-604(a)(1), the statute provided: “’Without an existing relationship or interest in an issue[,] ... a lawyer, except as provided in the Rules of Professional Conduct, may not ... for personal gain, solicit another person to sue or to retain the lawyer to represent the person in a lawsuit[.]’” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, referencing Son at 456-57, 709 A.2d 112 (quoting BO&P § 10-604(a)(2)(i)). The circuit court granted summary judgment for the consultant and the law firm. Son appealed. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, referencing Son at id. at 444, 709 A.2d 112.

The Maryland Supreme Court noted court upheld the circuit court’s opinion noting, in part, “[w]e noted that the consultant in Son’s case had not approached Son’s wife; rather, it was Son’s wife who had asked the consultant to assist her in finding an attorney. Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6. Further, the court noted that the Maryland Supreme Court in the case rejected “Son’s argument that the consultant engaged in ‘constructive solicitation’ by holding herself out as someone in the community who, for a fee, regularly assisted Korean people in finding attorneys, we explained that Son “miss[ed] the point of the statute and, to the extent relevant, the antecedent common law.” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, referencing Son at id. at 444, 709 A.2d 112. Continuing, the court noted that “[w]e explained that ‘[t]he thrust of the offense is stirring up, meddling in, or maintaining litigation in which the person has no interest, for personal gain. The officious meddling and the personal gain are separate elements, and both must be satisfied.’” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *11, referencing Son, at 459-60, 709 A.2d 112. Ultimately, the court noted that “[b]ecause there was no evidence that the consultant ‘engaged in any proscribed meddling,’ and because there was also no evidence that anyone at the law firm had engaged in any solicitation or committed any other prohibited act, we held that there was no violation of the barratry statute.” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *6, referencing Son at 460, 709 A.2d 112.

[23] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8 citing Accrued Financial Services, Inc. v. Prime Retail, Inc., 298 F.3d 291, 303 (4th Cir. 2002) (Michael, J., dissenting).

[24] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *8.

[25] Id. at *8, citing Schaferman v. O’Brien, 28 Md. 565, 573-574 (1868).

[26] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *9.

[27] Id. at *9, citing Pope v. State, 284 Md. 309, 343, 396 A.2d 1054 (1979)

[28] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *9. On this point, the court explained: “While the Court in Son recognized that the ‘officious meddling’ that characterized “the antecedent common law” is an element of the barratry statute, 349 Md. at 459, 709 A.2d 112, we do not read Son as calling into question the practice of soliciting holders of claims for assignments of such claims, where the person doing the solicitation hopes to profit from the assignment. The Court in Son was skeptical that broad conceptions of maintenance and champerty “survive[d] beyond the mid-Nineteenth Century” and suggested that these doctrines had collapsed into barratry, which the Legislature subsequently codified as an anti-solicitation statute. Id. at 458-59, 709 A.2d 112. The Court, therefore, did not address whether Maryland retains a strong public policy against ‘promot[ing] litigation for the benefit of the promoter rather than for the benefit of the real party in interest’ – the policy articulated by Accrued. Moreover, the only public policy considered in Son was not one based on common law maintenance-related doctrines, but rather one grounded in the Maryland Lawyers’ Rules of Professional Conduct, specifically regarding fee-splitting arrangements between attorneys and non-attorneys. See id. at 461, 709 A.2d 112.” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *9.

[29] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *9.

[30] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *10. On this point, the court noted as follows: “GEICO directs our attention to Hernandez v. Suburban Hospital Association, Inc., 319 Md. 226, 572 A.2d 144 (1990), and Schackow v. Medical-Legal Consulting Service, Inc., 46 Md. App. 179, 416 A.2d 1303 (1980), as evidence that Maryland courts in recent times have continued to consider whether a contract should be invalidated as a product of maintenance, champerty, or barratry. GEICO contends that these cases demonstrate the continuing viability of these common law doctrines. It is true that this Court in Hernandez and the Appellate Court of Maryland in Schackow addressed arguments based on these common law doctrines without suggesting that their viability had eroded. Notably, in both cases, the court declined to invalidate the assignment in question. See Hernandez, 319 Md. at 229, 235, 572 A.2d 144 (patient assigned to hospital the proceeds of any recovery in personal injury case to the extent necessary to pay her hospital bill; this Court stated: “’[W]e see no danger of champerty or maintenance, nor any other public policy reason to preclude the assignment of expected personal injury claim benefits to secure hospital or medical expenses actually incurred. Indeed, there is good reason to enforce such assignments.’”); Schackow, 46 Md. App. at 182, 194-96, 416 A.2d 1303 (agreement under which consulting service provided assistance in medical malpractice case in exchange for contingent fee held not to violate doctrines of champerty and maintenance). Moreover, there is no indication that, in defending the assignments, the hospital in Hernandez or the consulting service in Schackow argued that the doctrines were no longer viable.” Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *10.

[31] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *10. On this point, the court noted, as examples, that Minnesota had recently abolished the doctrine of champerty in Maslowski v. Prospect Funding Partners LLC, 944 N.W.2d 235, 238 (Minn. 2020), as well as Massachusetts in Saladini v. Righellis, 426 Mass. 231, 687 N.E.2d 1224, 1226-27 (1997) and South Carolina in Osprey, Inc. v. Cabana, L.P., 532 S.E. 2d 269 (SC 2000). Id. at *7.

[32] Government Employees Insurance Company v. MAO-MSO Recovery II, LLC, 2025 WL 1911733 (2025), at *11.

[33] The Fourth Circuit has jurisdiction over federal cases originating from Maryland, Virginia, West Virginia, North Carolina, and South Carolina. See, https://www.ca4.uscourts.gov/about-the-court

[34] On this point, the following United States District courts have ruled that MAPs can sue for “double damages:” California: MAO-MSO Recovery II, LLC v. Mercury Insurance, 2018 WL 3357493 (C.D. Calif. 2018); MAO-MSO Recovery II, LLC v. Farmers Insurance Exchange, 2018 WL 2106467 (C.D. Calif. 2018); Connecticut: Aetna v. Guerrera, 300 F.Supp.3d 367 (D. Conn 2018); Illinois: MAO-MSO Recovery II, LLC v. State Farm, 2018 WL 340021 (C.D. Ill. 2018); MSP Recovery Claims, Series 44 v. Zurich, 2023 WL 5227396 (N.D. Illinois 2023); Louisiana: Collins v. Wellcare Healthcare Plans, Inc., 73 F.Supp.3d 653 (E.D. La. 2014); Maryland: MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland 2024); Massachusetts: MSP Recovery Claims Series LLC v. Plymouth Rock Assurance Corporation, 404 F.Supp.3d 470 (D. Massachusetts 2019); Ohio: MSP Recovery Claims, Series LLC v. Phoenix Insurance Company, 426 F.Supp. 3d 458 (N.D. Ohio, 2019); MSP Recovery Claims, Series LLC v. Grange Insurance Company, 2019 WL 6770729 (N.D. Ohio 2019); and MSP Recovery Claims, Series LLC v. Progressive Corporation, 2019 WL 5448356 (N.D. Ohio 2019); South Carolina: Humana Ins. Co. v. Bi-Lo, LLC, 2019 WL 4643582 (D. South Carolina 2019); Tennessee: Cariten Health Plan, Inc. v. Mid-Century Ins. Co., No.: 2015 WL 5449221(E.D. Tenn. 2015); Texas: Humana Ins. Co. v. Farmers Tex. Cnty. Mut. Ins. Co., 95 F.Supp.3d 983 (W.D. Tex. 2014) and Humana v. Shrader, 584 B.R. 658 (S.D. Tex. 2018); and Virginia: Humana Ins. Co. v. Paris Blank LLP, 187 F. Supp.3d 676 (E.D. Va. 2016).

[35] MAO-MSP Recovery II, LLC v. Government Employers Ins. Co., 2024 WL 2924063 (D. Maryland, June 10, 2024), at *7.

[36] Id. See, Aetna Life Insurance Company v. Big Y Foods, Inc., 52 F.4^th (2^nd Cir. 2022), In re Avandia, 685 F.3d 353 (3rd Cir. 2012), and Humana v. Western Heritage Insurance Co., 832 F.3d 1229 (11th Cir. 2016). Of note, the Second Circuit has jurisdiction over federal cases arising from Connecticut, New York, and Vermont. Third Circuit has jurisdiction over federal cases originating in Delaware, New Jersey, Pennsylvania, and the U.S. Virgin Islands; while the Eleventh Judicial Circuit has jurisdiction over federal cases originating in Alabama, Florida, and Georgia. See, https://www.ca2.uscourts.gov/, https://www.ca3.uscourts.gov/ and https://www.ca11.uscourts.gov/

[37] MAO-MSP Recovery II, LLC, 2024 WL 2924063 at *9, citing Humana v. Western Heritage Insurance Co., 832 F.3d 1229, 1238 (11th Cir. 2016).