HB 577-FN – AS INTRODUCED
2009 SESSION
05/03
HOUSE 577-FN
AN ACT relative to recovery of public assistance and third party liability.
SPONSORS: Rep. DiFruscia, Rock 4
COMMITTEE: Health, Human Services and Elderly Affairs
This bill establishes criteria for the apportionment and recovery of medical assistance from Medicaid recipients who receive damages or other financial settlements from third party liability claims.
This bill is a request of the department of health and human services.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
09-0999
05/03
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nine
AN ACT relative to recovery of public assistance and third party liability.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Recovery of Assistance. Amend RSA 167:14-a to read as follows:
167:14-a Recovery of Assistance.
I. Any person who is a recipient of financial assistance, medical assistance, old age assistance, aid to the needy blind, Medicaid for employed adults with disabilities, or aid to the permanently and totally disabled shall, by [his] acceptance of such assistance, be deemed to have assigned any claim or right of action against any person or party to the commissioner of health and human services, to the extent that such assistance is furnished. Upon assignment, the recipient has a duty to cooperate with the commissioner of health and human services to enable the commissioner to obtain payment. Cooperation includes, but is not limited to, identifying and providing information to assist in pursuing third parties who may be liable to pay for care and services in accordance with 42 C.F.R. section 433.145. Any information provided to the commissioner by the recipient shall be subject to a Medicaid assignment privilege, such that the material shall remain subject to the attorney-client privilege and work product privilege, notwithstanding the fact that it has been shared with the commissioner. The Medicaid assignment privilege shall not prevent the commissioner from using the information in a petition for equitable apportionment, with an accompanying motion to seal if applicable and desired by the recipient.
II. Whenever a recipient of financial assistance, medical assistance, old age assistance, aid to the needy blind, Medicaid for employed adults with disabilities, or aid to the permanently and totally disabled shall have a legally cognizable claim against any person or party for expenses or support and the department of health and human services has already furnished assistance to such recipient, the amount of assistance furnished may be recovered in an action brought in the name of the state from such person or party against whom the recipient has a legally cognizable claim for expenses or support. The commissioner of health and human services may intervene in any pending suit brought by the recipient against any person or party against whom the recipient has a legally cognizable claim for expenses or support. Whether the commissioner of health and human services decides to file suit independently, to intervene, or to file a petition of equitable apportionment shall be solely within the commissioner’s discretion.
II-a. The commissioner of health and human services may recover the amount of medical assistance furnished to a dependent child from the child’s responsible parents to the extent authorized under Tile XIX and Title XXI of the Social Security Act. In such cases, the amount of assistance furnished and subject to reimbursement shall include, but not be limited to, expenditures for medical care and health insurance premiums and other expenditures paid by the state for enrollment or other fees for participation in the program. Any third-party payment for future medical expenses for the care of a dependent child through age 21 shall be paid to the responsible parents, subject to the commissioner’s lien.
II-b.(a) Any action brought by the commissioner of health and human services under this section shall be commenced within 7 years of the date the cause of action arises.
(b) Notwithstanding subparagraph (a), if a recipient has commenced an action to recover damages for an injury for which benefits are provided and has not provided notice of the action to the commissioner, or if medical services were provided to a minor, the commissioner may commence an action under this section within the later of 7 years of the date the cause of action arises or 2 years from the date the commissioner discovers the settlement or judgment, or 2 years from the date the minor obtains the age of 21, whichever is later.
(c) If the underlying claim could have been commenced outside the state, jurisdiction shall also lie in Merrimack county superior court.
III. The state medical assistance program is the payor of last resort and shall provide medical coverage only when there are no other available resources. Whenever a recipient of medical assistance shall receive a settlement or an award from a liable third person or party, such recipient shall repay the amount of medical assistance furnished by the state to the extent that the amount of the recovery makes repayment possible. If a recipient of medical assistance receives a settlement or an award from a third party, the settlement or award is subject to disbursement as provided in paragraphs III-a and IV.
III-a. The commissioner of health and human services may recover the full amount of medical assistance furnished by the state if there are proceeds available for such recovery after the deduction of reasonable [attorneys’] attorney’s fees[,] and litigation costs[, claims by other creditors, and 10 percent of the remaining net settlement amount for the recipient of medical assistance. Any balance remaining after the state has recovered the full amount due shall be available to the recipient of medical assistance]. The Medicaid lien shall be discharged from settlement funds reasonably attributed to payment of medical expenses based on the commercial value of the services provided. No [attorneys’] attorney’s fees shall be deducted from the amount due the state from such award or settlement. The commissioner may waive or reduce the amount due the state for good cause upon written request from a recipient or recipient’s attorney. The acceptance of any waiver or the payment of any reduced amount due shall create a rebuttable presumption that the apportionment was equitable in any action brought pursuant to paragraph IV. If there are other medical service creditors stemming from the same incident or accident, the commissioner shall not receive less than a pro rata share of the amount due based on the commercial value of the services provided.
III-b. Prior to settlement or trial, a liable third party shall verify with the plaintiff that arrangements have been made for payment of any Medicaid liens. If the third party fails to make such verification, the commissioner may continue to hold the third party liable for payment of the lien. Jurisdiction for such proceeding shall lie in Merrimack county superior court.
IV.(a) A disbursement of any award, judgment, or settlement shall not be made to a recipient without the recipient or the recipient’s attorney first providing at least [30] 60-days but no more than 120-days written notice of any scheduled trial, alternative dispute resolution hearing, or settlement to the commissioner of health and human services that the recipient has a claim which could result in a recovery from a third party or obtaining from the commissioner a written release of any obligation owed to the state for medical assistance provided to the recipient. The written notice shall identify the date, time, location, case caption, and the name of the judge or other decision maker or facilitator, sufficient to provide the commissioner with a meaningful opportunity to participate. The commissioner shall notify the recipient or the recipient’s attorney of the amount of the commissioner’s claim within 21 days of the commissioner’s receipt of the notice. If a dispute arises between the recipient and the commissioner of health and human services as to the settlement of any claim that arises under this section, the third party or the recipient’s attorney shall withhold from disbursement to the recipient or to any legal instrument created for the benefit of the recipient, an amount equal to the commissioner’s claim. Either party may apply to the superior court or the district court in which an action based upon the recipient’s claim could have been commenced for an order to determine an equitable apportionment between the commissioner and the recipient of the amount withheld. An order of apportionment has the effect of a judgment. The obligation of a third party under this paragraph to withhold all or part of a disbursement is conditional upon the receipt by the third party of written notice from the commissioner, the recipient, or the recipient’s attorney that the commissioner is asserting a claim.
(b) When settlement funds are apportioned between the recipient and the commissioner, Medicaid shall be treated as a collateral source. The portion of the gross settlement reasonably attributed to medical expenses shall include that portion of the settlement reasonably attributed to past medical costs and anticipated future medical expenses. There shall be a rebuttable presumption that the portion of the gross settlement reasonably attributed to payment of the Medicaid lien is 1/3 of the gross settlement. In no event shall the commissioner’s claim exceed 1/2 of the recipient’s recovery, after deducting attorney’s fees, litigation costs, and medical expenses paid by the recipient. If the portion of the gross settlement reasonably attributed to medical expenses exceeds the commissioner’s lien, the balance shall be available to other medical service lien holders and the recipient.
(c) Third party payment of past medical expenses, from the third party or from gross settlement funds, shall discharge the lien from the date of the incident or accident through the settlement of the underlying civil action.
(d) If a recipient pursues a civil action against a third party and chooses not to include as damages services the Medicaid program has provided, the recipient, or the recipient’s attorney, shall explicitly and prominently notify the commissioner that the recipient has elected not to seek compensation for services the Medicaid program has provided.
V. After notice and a hearing, the commissioner may impose an administrative penalty of up to $5,000 per violation upon any person who willfully fails to comply with the obligations of this section.
[V.] VI. All property, real or personal, in a revocable trust is subject to recovery by the department for recovery for any medical assistance provided the decedent. Upon the death of the grantor, the department shall provide the trustee with a statement containing the amount of medical assistance which was provided to the decedent.
[VI.] VII.(a) For purposes of recovering the costs of medical assistance, the estate of a recipient shall include all property, real or personal, which at the time of a recipient’s death was held by the recipient in joint tenancy with rights of survivorship, tenancy in common, or life estate for all such title or interest established on or after July 1, 2005. Recovery shall be limited to the value of the recipient’s ownership interest and in no case shall such amount exceed the total amount of medical assistance provided to the deceased recipient, nor shall recovery extend to any interest in property, real or personal, for which a non-recipient owner paid fair market value at the time said ownership interest was acquired.
(b) No sooner than 45 days from the death of the recipient, the department shall provide the other joint owner or owners notice of the department’s claim. Written notice shall include a description of all categories of individuals exempt from recovery by reason of familial status as allowed under 42 U.S.C. section 1396p(b)(2) and RSA 167:16-a, IV, as well as the availability and method of requesting a hardship waiver. Within 30 days of the receipt of notification of the department’s claim, the joint owner or owners shall acknowledge receipt of the department’s claim and, provided that there shall not be undue hardship imposed upon the surviving joint owner or owners, either tender an amount equal to the deceased recipient’s interest in the identified property and/or financial instrument to the state of New Hampshire toward the deceased’s medical assistance bill, but such amount shall not exceed the total amount of medical assistance provided to the deceased recipient, or enter into a binding agreement to make such payment as soon as is practicable. If the joint owner or owners refuse to acknowledge receipt of the department’s claim or to tender payment or fail to fulfill the agreement to pay without good cause, as required by this paragraph, the commissioner may bring an action in superior court or probate court, as the case may be, to compel such payment. Nothing in this paragraph shall be interpreted or applied so as to violate RSA 167:16-a or 42 U.S.C. section 1396p(b)(2)(A) and (B) prohibiting recovery when the recipient is survived by a spouse, minor children, or disabled children or when the recipient is survived by either siblings or children under certain circumstances.
2 Reference Change; Confidentiality of Department of Revenue Administration Records. Amend RSA 21-J:14, V(d)(8) to read as follows:
(8) An officer or employee of the department of health and human services in the performance of duties under RSA 167:14-a, [V] VI, which disclosure shall be limited to the report of the trust and a copy of the trust document, including any list of beneficiaries, filed in accordance with RSA 87:20.
3 Effective Date. This act shall take effect January 1, 2010.
LBAO
09-0999
01/21/09
HB 577-FN - FISCAL NOTE
AN ACT relative to recovery of public assistance and third party liability.
FISCAL IMPACT:
The Department of Health and Human Services states this bill would increase state general fund revenue by $520,050 in FY 2010 and each year thereafter. This bill would have no fiscal impact on state, county, and local expenditures, or county and local revenue.
METHODOLOGY:
The Department of Health and Human Services (DHHS) states this bill would modify the Recovery of Assistance statute, which among other things would set a rebuttable presumption that it is reasonable to allocate one-third of the recipient’s recovery from liable third persons to the re-payment of Medicaid expenditures on behalf of that recipient for injuries due to the tortuous acts of another. The bill would also statutorily clarify that DHHS is entitled to base its recovery on the reasonable cost of the services provided to the recipient, though DHHS would never recover more than its lien. The Department states medical lien amounts in FY 2008 totaled $1,548,804, of which $508,703 was recovered. As a result, the presumed additional funds recovered by this bill is estimated at $1,040,101. Recoveries are split 50/50 with the federal government, which would result in an increase in state general fund revenue of approximately $520,050.