Medicaid Third Party Liability Act
Bill: H.R.6622 | Sponsor: Rep. Burgess, Michael C. (R-TX)
Policy area: Health

Summary:
Medicaid Third Party Liability Act
This bill modifies requirements relating to Medicaid third-party liability.
Current law generally requires legally liable third parties (e.g., health insurers) to pay claims before Medicaid. However, Medicaid must pay first (and seek reimbursement from liable third parties) for claims for (1) preventive pediatric care, and (2) services for an individual for whom child support enforcement is being conducted by the state. The bill repeals these exceptions.
Current law also requires state Medicaid programs to take all reasonable measures to identify legally liable third parties. The bill specifically prohibits federal Medicaid payment for services to individuals for whom third-party insurance information was not obtained and verified by the state.

To amend title XIX of the Social Security Act to provide clarification 
    with respect to the liability of third party payers for medical 
  assistance paid under the Medicaid program, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medicaid Third Party Liability 
Act''.

SEC. 2. MEDICAID THIRD PARTY LIABILITY.

    (a) Removal of Special Treatment of Certain Types of Care and 
Payments Under Medicaid Third Party Liability Rules.--Section 
1902(a)(25) of the Social Security Act (42 U.S.C. 1396a(a)(25)) is 
amended by striking subparagraphs (E) and (F) and redesignating the 
subsequent subparagraphs accordingly.
    (b) Clarification of Role of Health Insurers With Respect to Third 
Party Liability.--Section 1902(a)(25) of the Social Security Act (42 
U.S.C. 1396a(a)(25)), as amended by subsection (b)--
            (1) in subparagraph (F), by striking at the end ``and'';
            (2) in subparagraph (G), by striking the period at the end 
        and inserting ``; and''; and
            (3) by adding at the end the following new subparagraph:
                    ``(H) that, in the case of a State after January 1, 
                2023, that provides medical assistance under this title 
                through a contract with a health insurer (including a 
                group health plan, as defined in section 607(1) of the 
                Employee Retirement Income Security Act of 1974, a 
                self-insured plan, a fully insured plan, a service 
                benefit plan, a managed care organization, a pharmacy 
                benefit manager, and any other health plan determined 
                appropriate by the Secretary)--
                            ``(i) such contract shall specify--
                                    ``(I) whether the State is 
                                delegating to such insurer all or some 
                                of its right of recovery from a 
                                responsible third party for an item or 
                                service for which payment has been made 
                                under the State plan (or under a waiver 
                                of the plan); and
                                    ``(II) whether the State is 
                                transferring to such insurer all or 
                                some of the assignment to the State of 
                                any right of an individual or other 
                                entity to payment from a responsible 
                                third party for an item or service for 
                                which payment has been made under the 
                                State plan (or under a waiver of the 
                                plan); and
                            ``(ii) in the case of a State that elects 
                        an option described in subclause (I) or (I) of 
                        clause (i) with respect to a health insurer 
                        (including a group health plan, as defined in 
                        section 607(1) of the Employee Retirement 
                        Income Security Act of 1974, a self-insured 
                        plan, a fully insured plan, a service benefit 
                        plan, a managed care organization, a pharmacy 
                        benefit manager, and any other health plan 
                        determined appropriate by the Secretary), the 
                        State shall provide assurances to the Secretary 
                        that the State laws referred to in subparagraph 
                        (G) confer to the health insurer the authority 
                        of the State with respect to the requirements 
                        specified in clauses (i) through (iv) of such 
                        subparagraph.''.
    (c) Increasing State Flexibility With Respect to Third Party 
Liability.--Section 1902(a)(25)(G) of the Social Security Act (42 
U.S.C. 1396a(a)(25)(I)), as redesignated by subsection (a), is 
amended--
            (1) in clause (i), by striking ``medical assistance under 
        the State plan'' and inserting ``medical assistance under a 
        State plan (or under a waiver of the plan)'';
            (2) by striking clause (ii) and inserting the following new 
        clause:
                            ``(ii) accept--
                                    ``(I) the State's right of recovery 
                                and the assignment to the State of any 
                                right of an individual or other entity 
                                to payment from the party for an item 
                                or service for which payment has been 
                                made under the respective State's plan 
                                (or under a waiver of the plan); and
                                    ``(II) after January 1, 2023, as a 
                                valid authorization of the responsible 
                                third party for the furnishing of an 
                                item or service to an individual 
                                eligible to receive medical assistance 
                                under this title, an authorization made 
                                on behalf of such individual under the 
                                State plan (or under a waiver of such 
                                plan) for the furnishing of such item 
                                or service to such individual;'';
            (3) in clause (iii)--
                    (A) by inserting ``not later than 60 days after 
                receiving'' before ``respond to''; and
                    (B) by striking ``; and'' at the end and inserting 
                ``, respond to such inquiry; and''; and
            (4) in clause (iv), by inserting ``a failure to obtain a 
        prior authorization,'' after ``claim form,''.
    (d) Verification of Insurance Status Required.--
            (1) In general.--Section 1902(a)(25)(A)(i) of the Social 
        Security Act (42 U.S.C. 1396a(a)(25)(A)(i)) is amended by 
        inserting ``, including the collection of, with respect to an 
        individual seeking to receive medical assistance under this 
        title, information on whether the individual has health 
        insurance coverage provided through a third party (as described 
        in such paragraph) and the plan of such insurer in which the 
        individual is enrolled'' after ``sufficient information''.
            (2) FFP unavailable without insurance status 
        verification.--Section 1903(i) of the Social Security Act (42 
        U.S.C. 1396b(i)) is amended--
                    (A) in paragraph (26), by striking ``; or'' and 
                inserting ``;'';
                    (B) in paragraph (27), by striking ``of the 
                State.'' and inserting ``of the State; or''; and
                    (C) by inserting after paragraph (27) the 
                following:
            ``(28) with respect to any amounts after January 1, 2023, 
        expended for medical assistance for individuals for whom the 
        State has not obtained and verified, in accordance with section 
        1902(a)(25)(A)(i), information on whether such an individual 
        has coverage provided through a third party (as described in 
        such paragraph) and the plan of such coverage in which the 
        individual is enrolled.''.

SEC. 3. EFFECTIVE DATE.

    In the case of a State plan for medical assistance under title XIX 
of the Social Security Act that the Secretary of Health and Human 
Services determines requires State legislation (other than legislation 
appropriating funds) in order for the plan to meet the additional 
requirement imposed by the amendments made under this section, the 
State plan shall not be regarded as failing to comply with the 
requirements of such title solely on the basis of its failure to meet 
this additional requirement before the first day of the first calendar 
quarter beginning after the close of the first regular session of the 
State legislature that begins after the date of the enactment of this 
Act. For purposes of the previous sentence, in the case of a State that 
has a 2-year legislative session, each year of such session shall be 
deemed to be a separate regular session of the State legislature.
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