First Regular Session Seventieth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 15-0758.01 Bart Miller x2173 HOUSE BILL 15-1179 HOUSE SPONSORSHIP Joshi, Dore, Windholz SENATE SPONSORSHIP (None), House Committees Senate Committees Public Health Care & Human Services A BILL FOR AN ACT Concerning a system for tracking third party responsibility to aid the department of health care policy and financing in recovering health care costs of medicaid recipients for which a third party is responsible. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) The department of health care policy and financing (department) has an enforceable right and a lien right against third parties responsible for a medicaid recipient's health care costs when the department has provided medicaid moneys for those costs. The bill creates a system through which the department can determine whether a third party has responsibility for any portion of a medicaid recipient's health care costs. The system requires the department to commence any action to recover moneys within 2 years after the date of the accident or event causing the injury to the medicaid recipient. The system does not apply to insurance policies that do not pay for bodily injury, claims for property damage or loss of use of property, claims made against accident and health policies, whether expense incurred or indemnity, and all workers' compensation claims. The system requires that prior to paying $2,000 or more on behalf of or to a claimant on a claim under a contract of insurance, every covered insurer shall exchange information with the department through a data matching process with one or more insurers using automated data exchanges that, to the maximum extent feasible, compare claimant information held by insurers with the information in the department's database of medicaid recipients. If the department determines there is a match between a medicaid recipient and an insured, the department provides a notice of lien to the insurer for the recovery of medical expense benefits. The insurer withholds the lesser of the amount of the claim payment or the full amount of the lien and remits that amount to the department. The bill requires the department to notify a recipient and his or her attorney, if represented, of actions taken under the bill and affords the recipient the right to request a hearing to remedy grievances. The bill makes any insurer, insurance claim data collection organization, and their employees, providing data or making lien payments under the bill, immune from any civil liability for providing data or making lien payments under the bill. The bill specifies that any person found to be immune under the bill is entitled to recover reasonable attorney fees and costs from the party that brought the action against the person found to be immune. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, add 25.5-4-301.5 as follows: 25.5-4-301.5. Colorado medicaid intercept system - claim matching with insurance. (1) As used in this section, unless the context otherwise requires: (a) "Claimant" means either an insured under a policy of insurance or a third party to an insurance policy, requesting benefits orally or in writing in excess of two thousand dollars, for injuries received as a result of an accident or loss. "Claimant" includes a person's legal representative, family member, or any other individual acting on the claimant's behalf. (b) "Insurer" means any insurance company licensed to do business in this state that provides coverage for third party payments for bodily injury from insurers and self-funded primary plans for auto insurance under part 6 of article 4 of title 10, C.R.S., and for other bodily injury losses. "Insurer" does not include liability policies that do not pay for bodily injury, claims for property damage or loss of use of property, claims made against accident and health policies, whether expense incurred or indemnity, and all workers' compensation claims. (c) "Medicaid recipient" means a recipient who has received medical assistance benefits under this article and articles 5 and 6 of this title in excess of two thousand dollars. (d) "Plan" means any entity that is self-insured for its legal responsibility without the benefit of primary insurance through the use of a self-insured retention. "Plan" includes any entity that is directing the handling of its claims through a third party or as a result of a policy buy back, cost-sharing agreement, or coverage-in-place agreement. (2) In accordance with this article and articles 5 and 6 of this title and applicable rules, a medicaid recipient automatically assigns his or her rights to the state department to any payments under applicable insurance coverage as a result of an accident or loss. The purpose of this section is to regulate the recovery of moneys paid by the state department under this article and articles 5 and 6 of this title. (3) (a) Nothing in this section limits the state department from recovery of any other moneys allowed, to the extent of the distribution, in accordance with all state and federal laws. (b) Any action to pursue any recovery of moneys paid by the state department shall be commenced within two years after the date of the accident or event causing the injury asserted by the medicaid recipient. Nothing in this section lengthens any time limitations set forth in any plan or insurance policy. (4) (a) For purposes of this section, the matching process is limited to a medicaid recipient or estate making a bodily injury or wrongful death claim against a plan or under an insurance policy. (b) Claims excluded from interception include liability policies that do not pay for bodily injury, claims for property damage or loss of use of property, claims made against accident and health policies, whether expense incurred or indemnity, and all workers' compensation claims. (c) At any time prior to making a total payment of two thousand dollars or more on behalf of or to a claimant on a claim under a plan or contract of insurance, every plan or insurer issuing automobile or policies of liability insurance shall exchange information with the state department by the means set forth in this section to determine if the claimant is a medicaid recipient. (d) In order to facilitate compliance with this section, the state department shall develop and operate a data match system after consulting with one or more insurers and plans, using automated data exchanges to the maximum extent feasible, to compare claimant information held by insurers and plans with the state department's database of medicaid recipients. (e) (I) In order to comply with this section, an insurer or plan shall provide the state department with the name and address of the individual or estate determined by the state department to be a medicaid recipient. (II) An insurer or plan may provide the following optional data: Date of birth and last four digits of a social security number. (f) An insurer or plan may provide the information required by paragraph (e) of this subsection (4) by: (I) Authorizing an insurance claim data collection organization, to which the insurer or plan subscribes and to which the insurer or plan submits the required claim data on at least a weekly basis, to: (A) Receive or access a data file from the state department and conduct a data match of all individuals who have a claim with the insurer or plan and who are medicaid recipients and submit the required data for each resulting data match to the state department or the state department's authorized vendor; or (B) Submit a data file to the state department that contains the required data for each claim being maintained by the insurer or plan which the state department shall use to conduct a data match; (II) Providing the required data for each claim being maintained by the insurer or plan directly to the state department in an electronic medium; or (III) Receiving or accessing a data file from the state department and conducting a data match of individuals who have a claim with the insurer or plan and who are medicaid recipients and submit the required data for each resulting data match to the state department. (g) Upon receiving notice of a match under this section, the state department shall send the insurer or plan a notice of lien under section 25.5-4-301 (5). (h) Any insurer or plan that can show that it has made a good-faith effort to comply with this section shall be deemed to have complied unless the state department proves an intentional failure to comply by demonstrating a pattern and practice of noncompliance. A single instance will not be sufficient proof. (5) The insurer or plan shall withhold the lesser of the amount of the claim payment or the full amount as set forth in the notice of lien and shall remit that amount to the state department, subject to the following conditions: (a) The lien shall encumber the right of the claimant to payment under the policy or plan, and the insurer or plan shall disburse to the claimant only that portion of the payment, if any, after the lien has been satisfied. (b) The lien is inferior to any lien or claim for attorney fees. (c) If the medicaid recipient or the representative of the medicaid recipient, or both, believe that the payment of the lien exceeds the extent of the distribution, in accordance with all state and federal laws, and if the medicaid recipient or representative, or both, notify the insurer or plan of the intent to file an administrative appeal with the state department as provided in subsection (8) of this section, the insurer or plan may issue a check made payable to the medicaid recipient, the representative of the medicaid recipient, and the state department. (d) The insurer or plan may notify the state department of its intent to issue a payment as a single check made payable to the medicaid recipient, any representative of the medicaid recipient, any other lienholder, and the state department. (e) If the lien is received after the insurer or plan has issued the payment, the insurer or plan shall notify the state department of the following information: Date of payment, amount of payment, payee, and address of payee. The insurer or plan shall not be obligated to make any further payments. (6) The information obtained by the state department under this section shall be used only to aid in recovery of medical assistance payments. An insurer or plan, and its directors, agents, or employees, and any insurance claim data collection organization and its agents and employees authorized by an insurer or plan to act on its behalf, shall keep this information safe and confidential in accordance with applicable law. (7) The state department shall provide written notice to the claimant and his or her attorney, if represented, that includes the date, name, social security number, case number, and amount of the payment being withheld to reimburse the state, reason for the payment, and the opportunity to request a hearing. (8) Any medicaid recipient aggrieved by any action taken under this section may, within thirty days after the date of the notice to the claimant, request a hearing from the state department. Any payments made by an insurer or plan pursuant to this section shall be made to the state department, unless there is a request for a hearing within thirty days after the notice or within ten business days after a decision after a hearing and in accordance with the decision of any hearing that takes place. (9) (a) An insurer or plan, and its directors, agents, or employees, and any insurance claim data collection organization and its agents and employees authorized by an insurer or plan to act on its behalf, which provides or attempts to provide data under this section, are immune from civil liability under any law to a person or entity for alleged or actual damages that occur as a result of providing or attempting to provide data under this section. This section does not create any other obligations upon insurers or plans. (b) An insurer or plan, and its directors, agents, or employees, and any insurance claim data collection organization and its agents and employees authorized by an insurer or plan to act on its behalf under this section are immune from civil liability under any law to a person or entity for alleged or actual damages that occur as a result of making a lien payment to the state department as provided in this section. (c) An insurer or plan, and its directors, agents, or employees, and any insurance claim data collection organization and its agents and employees authorized by an insurer or plan to act on its behalf against whom an action is brought who is found to be immune from liability under this section shall be entitled to recover reasonable attorney fees and costs from the person or party who brought the action. This section does not abrogate or modify in any way any common law or statutory privilege or immunity enjoyed by any insurer, organization, or person. SECTION 2. Act subject to petition - effective date - applicability. (1) This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 5, 2015, if adjournment sine die is on May 6, 2015); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2016 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor. (2) This act applies to payments for bodily injury by insurers and to payments for medical assistance under article 4 of title 25.5, Colorado Revised Statutes, on or after the applicable effective date of this act.