Colorado Legislative Council Staff

STATE

FISCAL IMPACT

Drafting Number:

Prime Sponsor(s):

LLS 99-0433

Rep. McElhany

Sen. Owen

Date:

Bill Status:

Fiscal Analyst:

February 3, 1999

House Transportation

Janis Baron (303-866-3523)

 

TITLE:            CONCERNING APPLICATION OF THE DOCTRINE OF CONTRIBUTORY NEGLIGENCE TO CASES BROUGHT UNDER THE "COLORADO MEDICAL ASSISTANCE ACT".



Fiscal Impact Summary

FY 1999/2000

FY 2000/2001

State Revenues *

General Fund


 

 

State Expenditures *

General Fund

Federal Fund

 

 

FTE Position Change

0.0 FTE

0.0 FTE

Other State Impact: None

Effective Date: January 1, 2000, and shall apply to causes of action arising under the "Colorado Medical Assistance Act" on or after that date.

Appropriation Summary for FY 1999-2000: None Required

Local Government Impact: None

 

*    The bill neither increases nor decreases state revenues or expenditures. Rather, it limits the ability of the Department of Health Care Policy and Financing to recover moneys paid for medical services; moneys that have historically been used as a direct offset to expenditures.



Summary of Legislation


            The bill amends the statute that allows the state to recover medical benefits paid out for a Medicaid recipient in cases involving third party liability. The bill eliminates language that provides that a Medicaid recipient's contributory negligence is not imputed to the state, thereby allowing the Medicaid recipient's contributory negligence to be considered in the same manner as in other negligence cases.





State Revenues and Expenditures


            The Department of Law indicates that deletion of "The contributory negligence of the recipient shall not be imputed to the state department." will adversely affect the rights of recovery in the Department of Health Care Policy and Financing.


            The Department of Health Care Policy and Financing indicates that third party liability recoveries for medical assistance from tort and casualty cases totaled $2.2 million in FY 1997-98. Under the bill, if a recipient were to be deemed negligent for any percentage of an incident, their award would be reduced by that percentage and the department's opportunity for recovery would also be reduced by that percentage.


            These recoveries are applied as a direct offset to costs incurred for medical services. From a budgetary perspective, these recoveries are not considered revenues, rather they are considered an offset to expenditures made. Because Medicaid is funded with federal financial participation, recoveries offset approximately 50 percent General Fund expenditures and 50 percent federal funds expenditures. Of the $2.2 million recovered in FY 1997-98, it is not known how many of the recoveries involved a recipient who was negligent in whole or in part. Although the bill will not require additional funding, the bill has a fiscal impact insofar as the Department of Health Care Policy and Financing will no longer be able to fully pursue third party liability recoveries.



State Appropriations


            No appropriation clause is required at this time.



Departments Contacted


            Health Care Policy and Financing