S-2027 : Still Just a Bill

Medicaid Third Party Liability Act

This bill alters provisions related to third-party liability for medical assistance paid under the Medicaid program. Specifically, with respect to such liability, the bill:

• expands the definition of "responsible third party" to include, among other health insurers, the TRICARE program;
• eliminates special rules with respect to certain services provided to children;
• requires the inclusion, in a contract between a state Medicaid program and a health insurer, of certain information regarding whether the state is delegating or transferring to the insurer a right of third-party recovery; 
• provides for the treatment as overpayment of reimbursements made by a responsible third party to a health insurer;
• disallows a responsible third party from denying a state's claim solely on the basis of a failure to obtain a prior authorization; 
• imposes a timeline for a responsible third party to respond to a state's inquiry regarding a claim for payment;
• provides for reductions to a state Medicaid program's federal matching rate if the state fails to comply with third-party insurance requirements; and
• modifies other provisions related to third-party liability under the Medicaid program.

Third-party liability requirements applicable under Medicaid shall also apply under the Children's Health Insurance Program (CHIP).

The Centers for Medicare & Medicaid Services must:

• publish on its website, and annually update, best practices for assessing third-party liability;
• monitor and analyze efforts to assess that liability;
• in consultation with states, develop and make available a model uniform reporting field for identifying information related to responsible third parties; and
• provide other specified information and guidance to states.