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In an October 28, 2010 memorandum to all judges in NJ, the Chief Judge of the NJ Department of Labor and Workforce Development precludes the use of broad release language requiring indemnification of Medicare.  NJ WC courts found that the language requested was not fair and just, a required finding in NJ WC settlements. 

The language being included was as follows:

“The claimant . . .agrees to indemnify defendant, hold harmless the respondent from any action by Medicare seeking payment of past, current or future medical expenses for the claimant. Claimant shall further hold the respondent harmless from any and all adverse consequences in the event the settlement results in the loss of right to Social Security and/ Medicare benefits to the extent claimant would have been entitled to those benefits in the absence of the settlement agreement.”

This type of language is being included in releases more and more across the board.  In my opinion, inclusion of this type of indemnification language exposes personal injury lawyers to a malpractice claim if there was ever a subsequent indemnification action since the client was not paid anything for that additional obligation and it probably wasn’t a negotiated term of the settlement.  While that possibility is remote, why agree to the indemnification at all?  Is it really necessary to protect the defendant?