We have received text from H.R. 497: Medicaid Third Party Liability Act. This bill was received on 2025-01-16, and currently has no cosponsors.
Here is a short summary of the bill:
This bill, titled the Medicaid Third Party Liability Act, aims to modify certain aspects of Medicaid's third-party liability rules. Here is a summary of its key provisions:
1. Changes to Medicaid Third Party Liability Rules
The bill proposes to amend Section 1902(a)(25) of the Social Security Act by removing specific subparagraphs that provide special treatment to certain types of care and payments under Medicaid. By doing this, it aims to streamline how third-party payers are held liable for medical assistance paid under the Medicaid program.
2. Health Insurers' Role Clarification
The Act seeks to clarify the role of health insurers in relation to third-party liability. The amendments will require that any state Medicaid program that contracts with insurers (like group health plans, managed care organizations, etc.) specifies:
- Whether the state is delegating all or some of its rights to recover payments from a third party to the insurer.
- If the state is transferring any rights to receive payment from a responsible third party for items or services covered under the Medicaid plan.
3. State Flexibility Enhancement
The legislation allows states greater flexibility regarding third-party liability by ensuring that they can accept recovery rights relating to medical assistance provided under their Medicaid programs.
4. Insurance Status Verification Requirement
New requirements will mandate states to verify whether individuals seeking Medicaid assistance have third-party health insurance coverage. Key points include:
- States must collect information on the health insurance status of individuals applying for medical assistance.
- States will not receive federal funding for amounts expended on medical assistance if they have not verified an individual’s insurance status.
5. Effective Date
The legislation stipulates that for state Medicaid plans requiring legislative changes to comply with these new rules, compliance is expected following the first regular session of the state legislature after the bill's enactment.
Relevant Companies
- UNH - UnitedHealth Group: As a major health insurer, the changes in Medicaid’s third-party liability rules could affect how they manage claims and recoveries related to Medicaid patients.
- CNC - Centene Corporation: Centene, which specializes in providing Medicaid services, might need to adjust its contracts and recovery strategies in light of the new regulations concerning Medicaid third-party reimbursement.
- HUM - Humana Inc.: Changes in responsibility for recovery from third parties could alter Humana's operational procedures for managing Medicaid beneficiaries.
- ANTM - Anthem, Inc.: As a health benefits company, Anthem may face changes in how they recover payments on behalf of Medicaid enrollees due to the clarified insurer roles under this legislation.
This article is not financial advice. See Quiver Quantitative's disclaimers for more information.
