§ 41.014.Interest on Damages Subject to Medicare Subrogation

A narrow 2013 provision solving a genuine timing problem.

Where the United States has a subrogation right under the Medicare secondary payer statute, a defendant cannot safely pay that portion of a judgment until the Centers for Medicare and Medicaid Services says what it is owed. Paying the plaintiff directly risks having to pay the government again. Meanwhile interest accrues.

The section stops the clock. Postjudgment interest does not accrue on the unpaid balance attributable to any portion of the award subject to that subrogation right, before the defendant receives a recovery demand letter issued by CMS or a designated contractor under the governing federal regulation.

Subsection (b) sets the deadline once the figure arrives: interest does not accrue at all if the defendant pays the unpaid balance before the 31st day after receiving the demand letter. Pay within 30 days and the suspension becomes forgiveness.

Two limits keep it narrow. If the defendant appeals the award, the section does not apply — a defendant cannot both contest the judgment and enjoy an interest holiday on it. And interest continues to accrue normally on any portion to which the United States has no subrogation right. Only the Medicare-subrogated slice is affected.