THE ATTORNEY GENERAL 

OF TEXAS 

September 7, 1989 

JlX Mxl"roX 

.%lTo*SEY G&SERAL. 

Honorable John Owens 

Henderson County Attorney 

Courthouse 

Athens, Texas 75751 

Opinion No. JR-1094 

Re: Whether a county may recover expenses incurred under 

the Indigent Health Care Act 

(RQ-1522) 

Dear Mr. Owens: 

You ask about the authority of a county to seek reimbursement for money it has spent pursuant to the provisions 

of the Indigent Health Care and Treatment Act, article 

44381, V.T.C.S. You explain that Henderson County has spent 

a large sum of money for medical treatment for a particular 

individual. The individual has now filed a personal injury 

action against a private individual, and you ask whether the 

county may seek reimbursement if the individual receives a 

settlement or judgment that covers his medical expenses. 

The Indigent Health Care and Treatment Act requires a 

county to pay for medical care for indigent residents of the 

county who are not residents of a hospital district or the 

area a public hospital has an obligation to serve. Id. 

tit. 2. The act requires that the Department of Human 

Services "establish eligibility standards and application, 

documentation, and verification procedures for counties 'to 

use in determining eligibility." & 5 1.06(a). 

Nothing in the Indigent Health Care and Treatment Act 

or the current regulations purports to place a lien on or 

to provide for the assignment of any potential right of 

recovery in a personal injury action. Cf. Hum. Res. Code 

9 32.033 (filing of an application for receipt of medical 

assistance constitutes an assignment of the applicant's 

right of recovery from another person for personal injur 

caused by the other person's negligence or wrong). ?i 

1. For examples from other jurisdictions of statutory 

liens on or assignments of later-acquired property of 

(Footnote Continued) 
Honorable John Owens - Page 2 (JM-1094) 

Indeed, nothing in the Indigent Health Care and Treatment 

Act or current regulations would require an indigent to 

report any unsettled tort claim on an application for 

assistance under the Indigent Health Care and Treatment Act. 

See a-nerallv 40 T.A.C. ss 14.104 and 14.105 (income and 

resources standards under Indigent Health Care and Treatment 

Act) .2 

Although the act does not expressly provide for a lien 

or an assignment in the context you ask about, it is clear 

. that the legislature did not intend for counties to pay for 

medical care when another source of payment exists. For 

example, section 1.06(c)(5) requires that an applicant 

provide information about "the existence of insurance 

coverage or other hospital or health care benefits for which 

the applicant is eligible." Also, section 2.02(b) of 

article 4438f provides: 

The county is the payor of last resort 

and shall provide assistance only if other 

adequate public or private sources of payment 

are not available. 

(Footnote Continued) 

welfare recipients, see Conn. Gen. Stat. Ann. 55 17-83e, 

17-83f (West 1988) (lien on later acquired or 

estate for AFDC or delinquent 

prq;rty 

child support); . Ann. 

Stat. ch. 23, para. 11-22 (Smith-Hurd 1988) (charge on 

personal injury claims for repayment of public medical 

assistance): Minn. Stat. Ann. 5 393.10 (West 1968 & Supp. 

1989) (county lien on any cause of action o: 4rf;o; 

furnished medical assistance): N.J. Stat. Ann. : - 

(West Supp. 1988) (provision that application for AFDC 

operates as assignment of other rights to support): N.Y. 

Sot. Serv. Law 5 104-b (McKinney 1983) (lien on suit for 

personal injury as repayment of public assistance): id. 

8 366 (McKinney 1983 & Supp. 1988) (repayment of costs of 

medical care and services): Pa. Stat. Ann. tit. 62 5 403 

(Purdon Supp. 1988) (assignment of property rights to state 

as prerequisite for public assistance). 

2. The regulations of the Department of Human Services 

list "lump-sum payments" as a type of resource. 40 T.A.C. 

5 14.105(c)(ll). We think it is clear from the examples of 

OOlump-sum payments," however, that a V1lump-sum payment" is a 

payment the receipt of which is certain. 

p. 5733 
Honorable John Owens - Page 3 (JM-1094) 

Section 2.03(a)(3) provides that a county has an obligation 

to provide indigent health care only if 'no other adequate 

source of payment exists." Also, a rule adopted by the 

Department of Human Services provides that mandatory 

services under the Indigent Health Care and Treatment Act do 

not include services and supplies that: 

are payable by or available under any health, 

accident, or other insurance coverage; by 

any private or other governmental benefit 

systems; hv anv leaallv liable third nartv; 

or under other contract. (Emphasis added.) 

40 T.A.C. S 14.202(b)(7). All those provisions, however, 

apply to sources of payment that "exist" or "are available" 

or for which a third party is "legally liable." A potential 

award in a personal injury suit does not yet exist and it is 

therefore not available. Further, no legal liability has 

been determined. Therefore, even though we think it is 

clear that the‘ legislature would not have intended for an 

indigent to be able to retain a windfall in the circumstances you ask about, we do not think the provisions cited 

above cover a potential, rather than actual, right to 

reimbursement. The question, then, is whether a lien on or 

an assignment of a future personal injury recovery can be 

implied from the provisions of the Indigent Health Care and 

Treatment Act. 'I 

It is the rule 

'perty or real estate 

in Texas that a lien on personal proarises only by virtue of contract or 

statutory provision. Ro*on v , Gibson, 274 S.W. 292, 293 

(Tex. Civ. App. - Waco 1925, no writ): see also Johnson v. 

Second Iniurv w, 688 S.W.2d 107, 108 (Tex. 1985) (right 

of subrogation does not exist except where clearly mandated 

by the legislature). Also, in 1961 this office considered 

whether a county could acquire a lien on the real estate of 

paupers for whom the county provided support. Attorney 

General Opinion WW-1150 (1961). This office concluded that 

a county could not acquire such a lien. The basis for that 

conclusion was that a county has only those powers expressly 

or impliedly conferred on them by the constitution or 

statutes. S e aener lly Annot., 

Affecting Elzgibilitt for, 

Personal Injury Recovery as 

or Duty to Reimburse, Public 

Welfare Assistance, 80 A.L.R.3d 772 (1977). In light of 

those authorities, we must conclude that under the current 

statute and regulations, which make no provision for a lien 

on or an assignment of a future personal injury recovery, a 

county does not have a right to reimbursement in the context 

you ask about. 

p. 5734 
Honorable John Owens - Page 4 (JM-1094) 

- ‘, 

Although current Department of Human Services regulations under the Indigent Health Care and Treatment Act do 

not require an assignment in the context you ask about, we 

do think that the Department of Human Services has authority 

to promulgate a rule requiring that an applicant for county 

as&stance under the Indigent Health Care and Treatment Act 

assign any personal injury recovery or right to recovery for 

medical expenses to the county, to the extent of the public 

funds expended. 

The department is required to set eligibility standards 

and application procedures "in accordance with" department 

rules relating to the AFDC-Medicaid program. V.T.C.S. art. 

4438f, 5. 1.06(a). Section 32.033 of the Human Resources 

Code, which governs the Medicaid program, provides in part: 

(a) The filing of an application for or 

receipt of medical assistance constitutes an 

assignment of the applicant's or recipient's 

- right of recovery from: 

(1) personal insurance; 

(2) other sources; or 

(3) another person for personal injury 

caused by the other person's negligence or 

wrong. 

See also 40 T.A.C. 9 45.501 (rule restating provision set 

out above). Because the department is authorized to adopt 

regulations governing eligibility for and application for 

indigent health care that are "in accordanceWq with the 

department's standards and procedures for determining 

eligibility in the AFDC-Medicaid program, we think it is 

within the department's authority to adopt a rule under the 

Indigent Health Care and Treatment Act that tracks the 

Uedicaid rule set out in section 32.033 of the Human 

Resources Code. 

It has been suggested that individual counties have 

independent authority to adopt such a rule under section 

1.06(h) of the Indigent Health Care and Treatment Act, which 

provides: 

A county may use the standards and 

;:,,;Fres established by *the department a;i 

use less restrictive standards 

procedures. A-. 

p. 5735 
-.. 

Honorable John Owens - Page 5 (JM-1094) 

See also V.T.C.S. art. 4438f, 9 2.04(b). Although that 

provision allows a county to adopt its own standards and 

procedures, it allows a county to do so only if the county's 

own standards and procedures are less restrictive than those 

of the Department of Human Services. In the absence of a 

department regulation requiring assignment of potential 

personal injury recoveries, a county would have no authority 

to adopt such a requirement since such a requirement would 

be more restrictive than the department's requirements. 

SUMMARY 

A county has no authority, under current 

law, to seek reimbursement from an indigent 

whose medical expenses are paid by the county 

in accordance with the Indigent Health Care 

and Treatment Act and who subsequently 

recovers damages in a personal injury suit. 

However, the Department of Human Services 

does have authority under the Indigent Health 

Care and Treatment Act to promulgate a rule 

requiring that applicants for county assistance under the Indigent Health Care and 

Treatment Act assign their rights to reimbursement from another person for personal 

injury caused by the other personjs negligence or wrong. 

JIM MATTOX 

Attorney General of Texas 

MARY KELLER 

First Assistant Attorney General 

mu MCCREARY 

Executive Assistant Attorney General 

JUDGE ZOLLIE STEARLEY 

Special Assistant Attorney General 

RICK GILPIN 

Chairman, Opinion Committee 

.- 

Prepared by Sarah Woelk 

Assistant Attorney General 

P. 5736