SSB 1167

_____ by the department of health and human services (HHS or the department) from third parties and taxation of Medicaid managed care organization premiums. DIVISION I —— MEDICAID PROGRAM THIRD-PARTY RECOVERY.54 (assignment —— lien).37 (duties of third parties) relates to the duties of third parties, defined under the bill as “an individual, entity, or program, excluding Medicaid, that is or may be liable to pay all or a part of the expenditures for medical assistance provided by a Medicaid payor to the recipient”. The listing of “third parties” includes but is not limited to a third-party administrator, a pharmacy benefits manager, a health insurer, a self-insured plan, a group health plan, a service benefit plan, a managed care organization, liability insurance including self-insurance, no-fault insurance, workers’ compensation laws or plans, and other parties that by law, contract, or agreement are legally responsible for payment of a claim for a medical service. The bill also defines terms including “Medicaid payor”, “recipient”, “third party”, and “third-party benefits”. The bill provides that the third-party obligations specified under the bill are a condition of doing business in the state, and a third party that fails to comply with these obligations shall not be eligible to do business in the state.25 (information provided to medical assistance program, hawk-i program, and child support recovery unit). _____ available; accepting the Medicaid payor’s rights of recovery and assignment to the Medicaid payor for payments which the Medicaid payor has made; accepting authorization provided by the Medicaid payor that the health care item or service is covered as if such authorization were the prior authorization made by the third party for such health care item or service; responding to inquiries from Medicaid payors regarding claims for payment; and not denying claims submitted by a Medicaid payor solely on the basis of the date of submission of the claim, the type or format of the claim form, a failure to present proper documentation, or in the case of specified third-party payors solely on the basis of a failure to obtain prior authorization if certain conditions are met. The department may adopt administrative rules to administer this Code section of the bill. Rules governing the exchange of information under the bill shall be consistent with all laws, regulations, and rules relating to the confidentiality or privacy of personal information or medical records, including but not limited to the federal Health Insurance Portability and Accountability Act (HIPAA) and regulations promulgated in accordance with HIPAA.54 (responsibility for payment on behalf of Medicaid-eligible persons —— liability of other parties) the bill includes specific provisions relating to the responsibility for payment on behalf of Medicaid recipients, which include both persons who have applied for and persons who have received medical assistance, when other parties are liable. The bill provides that it is the intent of the general assembly that Medicaid payors be the payor of last resort for medical services furnished to recipients. All other sources of payment for medical services are primary relative to medical assistance provided by the Medicaid payor. _____ the intent of the general assembly that the Medicaid payor be repaid in full and prior to any other person, program, or entity. The Medicaid payor shall be repaid in full from and to the extent of any third-party benefits, regardless of whether a recipient is made whole or other creditors paid. The bill provides definitions for “collateral”, “covered injury or illness”, “Medicaid payor”, “medical service”, “payment”, “proceeds”, “recipient” which includes both an applicant for and recipient of medical assistance, “recipient’s agent”, “third party”, and “third-party benefits”. The bill provides that third-party benefits for medical services shall be primary relative to medical assistance provided by the Medicaid payor. A Medicaid payor has all of the rights, privileges, and responsibilities identified under the bill, but if HHS determines that a Medicaid payor has not taken reasonable steps within a reasonable time to recover third-party benefits, HHS may exercise all of the rights of the Medicaid payor to the exclusion of the Medicaid payor following provision of notice to third parties and the Medicaid payor. A Medicaid payor may assign the Medicaid payor’s rights under the bill, including to another Medicaid payor, a provider, or a contractor. After the Medicaid payor has provided medical assistance, the Medicaid payor shall seek reimbursement for third-party benefits to the extent of the Medicaid payor’s legal liability and for the full amount of the third-party benefits, but not in excess of the amount of medical assistance provided by the Medicaid payor. Within days following discovery by a recipient of potential third-party benefits, a recipient and the recipient’s agent shall inform the Medicaid payor of any rights the recipient has to third-party benefits and provide identifying information for any person that is or may be liable to provide third-party benefits. _____ assistance, including that the Medicaid payor is automatically subrogated to any rights that a recipient or a recipient’s agent or legally liable relative has to any third-party benefit for the full amount of medical assistance provided by the Medicaid payor; that the Medicaid payor is automatically assigned any right, title, and interest a recipient or a recipient’s agent or legally liable relative has to a third-party benefit by virtue of applying for, accepting, or accepting the benefit of medical assistance, excluding any Medicare benefit to the extent required to be excluded by federal law; and that the Medicaid payor is entitled to and has an automatic lien upon the collateral for the full amount of medical assistance provided by the Medicaid payor to or on behalf of the recipient for medical services furnished as a result of any covered injury or illness for which a third party is or may be liable. Unless otherwise provided in the bill, the Medicaid payor shall recover the full amount of all medical assistance provided by the Medicaid payor on behalf of the recipient to the full extent of third-party benefits. A recipient and the recipient’s agent shall cooperate in the Medicaid payor’s recovery of the recipient’s third-party benefits and in establishing paternity and support of a recipient child born out of wedlock. The Medicaid payor has the discretion to waive, in writing, the requirement of cooperation for good cause shown and as required by federal law. The department may deny or terminate eligibility for any recipient who refuses to cooperate, unless HHS has waived cooperation. Within days of initiating formal or informal recovery, other than by filing a lawsuit, a recipient’s attorney shall provide written notice of the activity or action to the Medicaid payor. _____ purpose of obtaining reimbursement for medical assistance provided by the Medicaid payor. To enforce the Medicaid payor’s rights, the Medicaid payor may institute, intervene in, or join in any legal or administrative proceeding in the Medicaid payor’s own name, and in a number or a combination of capacities listed in the bill. An action by the Medicaid payor to recover damages in an action in tort, which is derivative of the rights of the recipient, shall not constitute a waiver of sovereign immunity. If an action is filed by a recipient or a recipient’s agent against a third party, the recipient, the recipient’s agent, or the attorney of the recipient or the recipient’s agent, as applicable, shall provide written notice to the Medicaid payor of the action, including the name of the court in which the action is brought, the case number of the action, and a copy of the pleadings. The recipient, the recipient’s agent, or the attorney of the recipient or the recipient’s agent, as applicable, shall also provide written notice of intent to dismiss the action prior to the voluntary dismissal of an action against a third party. Before a recipient finalizes a judgment, award, settlement, or any other recovery where the Medicaid payor has the right to recovery, the recipient, the recipient’s agent, or the attorney of the recipient or recipient’s agent, as applicable, shall give the Medicaid payor notice of the judgment, award, settlement, or recovery. The judgment, award, settlement, or recovery shall not be finalized unless the notice is provided and the Medicaid payor has a reasonable opportunity to recover under its rights to subrogation, assignment, and lien. If appropriate notice is not provided, the recipient, the recipient’s agent, and the recipient’s or recipient’s agent’s attorney are jointly and severally liable to reimburse the Medicaid payor for the recovery received to the extent of medical assistance paid by the Medicaid payor. _____ settlement of the recipient’s action or claim involving third-party benefits is subject to the Medicaid payor’s claim for reimbursement of the amount of medical assistance provided and any lien pursuant to the claim. The bill prohibits insurance and other third-party benefits from containing any term or provision which purports to limit or exclude payment or the provision of benefits for an individual if the individual is eligible for, or a recipient of, medical assistance, and any such term or provision shall be void as against public policy. In an action in tort against a third party in which the recipient is a party, of the amount recovered in any resulting judgment, award, or settlement from a third party, after reasonable attorney fees and filing fees, there is a rebuttable presumption that all Medicaid payors shall receive two-thirds of the remaining amount recovered or the total amount of medical assistance provided by the Medicaid payors, whichever is less; and the remaining amount recovered shall be paid to the recipient. In calculating the Medicaid payor’s recovered amount of medical assistance, the fee for services of an attorney retained by the recipient or the recipient’s legal representative shall not exceed one-third of the judgment, award, or settlement amount. If the recovered amount is insufficient to satisfy the competing claims of the Medicaid payors, each Medicaid payor shall be entitled to the Medicaid payor’s respective pro rata share of the recovered amount that is available. _____ trust account for the benefit of the Medicaid payor pending a determination of the Medicaid payor’s rights to the benefits. If federal law limits the Medicaid payor to reimbursement from the recovered damages for medical expenses, a recipient may contest the amount designated as recovered damages for medical expenses payable to the Medicaid payor as specified in the formula under the bill. To successfully rebut the formula, the recipient shall prove, by clear and convincing evidence, that the portion of the total recovery which should be allocated as medical expenses, including future medical expenses, is less than the amount calculated by the Medicaid payor pursuant to the formula. Alternatively, to successfully rebut the formula, the recipient shall prove, by clear and convincing evidence, that Medicaid provided a lesser amount of medical assistance than that asserted by the Medicaid payor. A settlement agreement that designates the amount of recovered damages for medical expenses is not clear and convincing evidence and is not sufficient to establish the recipient’s burden of proof, unless the Medicaid payor is a party to the settlement agreement. If the recipient or the recipient’s agent filed a legal action to recover against the third party, the court in which such action was filed shall resolve any dispute concerning the amount owed to the Medicaid payor, and shall retain jurisdiction of the case to resolve the amount of the lien after the dismissal of the action. If the recipient or the recipient’s agent did not file a legal action to resolve any dispute concerning the amount owed to the Medicaid payor, the recipient or the recipient’s agent shall file a petition for declaratory judgment. Venue for all such declaratory actions shall lie in Polk county. Each party shall pay the party’s own attorney fees and costs for any legal action conducted under this provision of the bill. _____ statute of limitations or repose applicable to an action or claim of a legally responsible relative for the minor’s medical expenses is extended in favor of the legally responsible relative so that the legally responsible relative shall have one year from and after the attainment of the minor’s majority within which to file a complaint, make a claim, or commence an action. In recovering any payments under the bill, the Medicaid payor may make appropriate settlements. The department may adopt administrative rules to administer this portion of the bill and applicable federal requirements. DIVISION II —— MEDICAID MANAGED CARE ORGANIZATION TAXATION OF PREMIUMS. The bill relates to taxation of health maintenance organizations.1 (tax on gross premiums —— exclusions).1.1.1.1A.1A (health maintenance organization —— medical assistance program —— premium tax) the parameters of the new tax on HMOs contracting with HHS to administer the medical assistance program under Code chapter 249A.5 percent of the premiums received and taxable. The premium tax shall be paid on or before March of the year following the calendar year for which the tax is due. _____ tax on or before the due date. An HMO subject to the new tax shall remit on or before June 1, on a prepayment basis, an amount equal to one-half of the HMO’s premium tax liability for the preceding calendar year; and shall remit on or before August 15, on a prepayment basis, an additional one-half of the HMO’s premium tax liability for the preceding calendar year. If a prepayment exceeds the HMO’s annual premium tax liability, the excess shall be allowed as a credit against the HMO’s subsequent prepayment or tax liabilities. The HMO may receive a credit or a cash refund in lieu of a credit against subsequent prepayment or tax liabilities. The commissioner of insurance may suspend or revoke the license of an HMO that fails to make a prepayment on or before the due date.13 a Medicaid managed care organization premiums fund in the state treasury under the authority of HHS. Moneys collected from the new tax on premiums shall be deposited in the fund. Moneys in the fund are appropriated to HHS for the purposes of the medical assistance program. Moneys in the fund that remain unencumbered or unobligated at the close of a fiscal year shall not revert but shall remain available for expenditure for the purposes designated. Interest or earnings on moneys in the fund shall be credited to the fund.