Bill 2976

                    Current Status

Bill Number:               2976
Ratification Number:       602
Act Number:                516
Introducing Body:          House
Subject:                   Provide for the assignment and
                           subrogation of any Medicaid applicant's claim
                           for reimbursement for Medicaid services from
                           private insurers or other third parties to the
                           State Health and Human Services Finance
                           Commission

(A516, R602, H2976)

AN ACT TO PROVIDE FOR THE ASSIGNMENT AND SUBROGATION OF ANY MEDICAID APPLICANT'S CLAIM FOR REIMBURSEMENT FOR MEDICAID SERVICES FROM PRIVATE INSURERS OR OTHER THIRD PARTIES TO THE STATE HEALTH AND HUMAN SERVICES FINANCE COMMISSION AND TO REPEAL SECTION 43-7-30, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO SUBROGATION OF MEDICAID BENEFICIARIES' CLAIMS AGAINST THIRD PARTIES.

Be it enacted by the General Assembly of the State of South Carolina:

Definitions

SECTION 1. (A) "Applicant" means an individual whose written application for Medicaid has been submitted to the agency determining medicaid eligibility, but has not received final action. This includes an individual (living or deceased) whose application is submitted by a representative or a person acting responsibly for the individual.

(B) "Commission" means the State Health and Human Services Finance Commission.

(C) "Medicaid" means the medical assistance program authorized by Title XIX of the Social Security Act and administered by the State Health and Human Services Finance Commission.

(D) "Person" means any natural person, company, association, partnership, corporation, or any other legal entity.

(E) "Practitioner" means a physician or other health care professional licensed under state law to practice his profession.

(F) "Private Insurer" means:

(1) Any commercial insurance company offering health or casualty insurance to individuals or groups (including both experienced-rated contracts and indemnity contracts);

(2) Any profit or nonprofit prepaid plan offering either medical services or full or partial payment for the diagnosis or treatment of an injury, disease, or disability; or

(3) Any organization administering health or casualty insurance plans for professional associations, unions, fraternal groups, employer-employee benefit plans, and any similar organization offering these plans or services, including self-insured and self-funded plans.

(G) "Provider" means an individual, firm, corporation, association, institution, or other legal entity which is providing, or has been approved to provide, medical assistance to a recipient pursuant to the State Medical Assistance Plan and in accord with Title XIX of the Social Security Act-Medical Assistance (Medicaid).

(H) "Recipient" means an individual who has been determined to be eligible for health services as described in the State Medical Assistance Plan in accord with Title XIX of the Social Security Act-Medical Assistance (Medicaid).

(I) "Third Party" means any individual, entity, or program that is or may be liable to pay all or part of the medical cost of injury, disease, or disability of an applicant or recipient.

Assignment

SECTION 2. (A) Every applicant or recipient, only to the extent of the amount of the medical assistance paid by Medicaid, shall be deemed to have assigned his rights to recover such amounts so paid by Medicaid from any third party or private insurer to the State Health and Human Services Finance Commission. This assignment shall not include rights to Medicare benefits. The applicant or recipient shall cooperate fully with the State Health and Human Services Finance Commission in its efforts to enforce its assignment rights.

(B) An applicant's and recipient's determination of, and continued eligibility for, medical assistance under Medicaid is contingent upon his cooperation with the Commission in its efforts to enforce its assignment rights. Cooperation includes, but is not limited to, reimbursing the Commission from proceeds or payments received by the applicant or recipient from any third party or private insurer.

(C) Every applicant or recipient is considered to have authorized all persons, including insurance companies and providers of medical care, to release to the Commission all information needed to enforce the assignment rights of the Commission.

Subrogation

SECTION 3. (A) The State Health and Human Services Finance Commission shall be automatically subrogated, only to the extent of the amount of medical assistance paid by Medicaid, to the rights an applicant or recipient may have to recover such amounts so paid by Medicaid from any third party or private insurer. The applicant or recipient shall cooperate fully with the State Health and Human Services Finance Commission and shall do nothing after medical assistance is provided to prejudice the subrogation rights of the State Health and Human Services Finance Commission.

(B) An applicant's and recipient's determination of, and continued eligibility for, medical assistance under Medicaid is contingent upon his cooperation with the Commission in its efforts to enforce its subrogation rights. Cooperation includes, but is not limited to, reimbursing the Commission from proceeds or payments received by the recipient from any third party or private insurer.

(C) Every applicant or recipient is considered to have authorized all persons, including insurance companies and providers of medical care, to release to the Commission all information needed to enforce the subrogation rights of the Commission.

Enforcement; identification; void provisions;

notice

SECTION 4. (A) The Commission, to enforce its assignment or subrogation rights, may take any one, or any combination of, the following actions:

(1) Intervene or join in an action or proceeding brought by the applicant or recipient against any third party, or private insurer, in state or federal court.

(2) Commence and prosecute legal proceedings against any third party or private insurer who may be liable to any applicant or recipient in state or federal court, either alone or in conjunction with the applicant or recipient, his guardian, personal representative of his estate, dependents, or survivors.

(3) Commence and prosecute legal proceedings against any third party or private insurer who may be liable to an applicant or recipient, or his guardian, personal representative of his estate, dependents, or survivors.

(4) Commence and prosecute legal proceedings against any applicant or recipient.

(5) Settle and compromise any amount due to the State Health and Human Services Finance Commission under its assignment and subrogation rights. Provided, further, any representative or attorney retained by an applicant or recipient shall not be considered liable to State Health and Human Services Finance Commission for improper settlement, compromise or disbursement of funds unless he has written notice of State Health and Human Services Finance Commission's assignment and subrogation rights prior to disbursement of funds.

(6) Reduce any amount due to the State Health and Human Services Finance Commission by twenty-five percent if the applicant or recipient has retained an attorney to pursue the applicant's or recipient's claim against a third party or private insurer, that amount to represent the State Health and Human Services Finance Commission's share of attorney's fees paid by the applicant or recipient. Additionally, the State Health and Human Services Finance Commission may, in its discretion, share in other costs of litigation by reducing the amount due it by a percentage of those costs, the percentage calculated by dividing the amount due the State Health and Human Services Finance Commission by the total settlement received from the third party or private insurer. Provided, further, any representative or attorney retained by an applicant or recipient shall not be considered liable to State Health and Human Services Finance Commission for improper settlement, compromise, or disbursement of funds unless he has written notice by certified mail of State Health and Human Services Finance Commission's assignment and subrogation rights prior to disbursement of funds.

(B) Providers and practitioners who participate in the Medicaid program shall cooperate with the Commission in the identification of third parties whom they have reason to believe may be liable to pay all or part of the medical costs of the injury, disease, or disability of an applicant or recipient.

(C) Any provision in the contract of a private insurer issued or renewed after the effective date of this act, which denies or reduces benefits because of the eligibility of the insured to receive assistance under Medicaid, is null and void.

(D) The assignment and subrogation rights of the Commission are superior to any right of reimbursement, subrogation, or indemnity of any third party or recipient. Provided, further, any representative or attorney retained by an applicant or recipient shall not be considered liable to State Health and Human Services Finance Commission for improper settlement, compromise, or disbursement of funds unless he has written notice of State Health and Human Services Finance Commission's assignment and subrogation rights prior to disbursement of funds.

Pending claim, action

SECTION 5. Any claim or action pending or brought before the effective date of this act may be completed and enforced as provided by law prior to the effective date of this act.

Repeal

SECTION 6. Section 43-7-30 of the 1976 Code is repealed.

Time effective

SECTION 7. This act shall take effect upon approval by the Governor.