HB2512 H&HR AM 3-11
The Committee on Health and Human Resources move to amend the
bill on page two, line six, by striking everything after the
enacting clause and inserting in lieu thereof the following:
"That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated §9-8-1, §9-8-2, §9-8-3,
§9-8-4 and §9-8-5, all to read as follows:
ARTICLE 8. ASSIGNMENT AND SUBROGATION OF CLAIMS FOR REIMBURSEMENT
FOR MEDICAID SERVICES
_____For purposes of this article:
_____(1) "Bureau" means the Bureau for Medical Services.
_____(2) "Department" means the West Virginia Department of Health
and Human Resources.
_____(3) "Recipient" means a person who applies for and receives
assistance under the Medicaid Program.
_____(4) "Secretary" means the Secretary of the Department of
Health and Human Resources.
_____(5) "Third-party" means an individual or entity that is
alleged to be liable to pay all or part of the costs of a
recipient's medical treatment and medical-related services for
personal injury, disease, illness or disability, as well as any
entity including, but not limited to, a business organization, health service organization, insurer, or public or private agency
acting by or on behalf of the allegedly liable third-party.
§9-8-2. Assignment of rights; right of subrogation by the _
_____(a) Assignment of rights. Submission of an application to the
department for medical assistance is, as a matter of law, an
assignment of the right of the applicant or his or her legal
representative to recover from third parties past medical expenses
paid for by the Medicaid program.
_____(1) At the time an application for medical assistance is made,
the department shall include a statement along with the application
that explains that the applicant has assigned all of his or her
rights as provided in this section and the legal implications of
making this assignment.
_____(2) This assignment of rights does not extend to Medicare
_____(3) This section does not prevent the recipient or his or her
legal representative from maintaining an action for injuries or
damages sustained by the recipient against any third-party and from
including, as part of the compensatory damages sought to be
recovered, the amounts of his or her past medical expenses.
_____(4) The department shall be legally subrogated to the rights
of the recipient against the third party.
_____(5) The department shall have a priority right to be paid first out of any payments made to the recipient for past medical
expenses before the recipient can recover any of his or her own
costs for medical care.
_____(6) A recipient is considered to have authorized all
third-parties to release to the department information needed by
the department to secure or enforce its rights as assignee under
_____(b) Notice requirement for claims and civil actions.
_____(1) A recipient's legal representative shall provide notice to
the department within 60 days of asserting a claim against a third
party. If the claim is asserted in a formal civil action, the
recipient's legal representative shall notify the department within
60 days of service of the complaint and summons upon the third
party by causing a copy of the summons and a copy of the complaint
to be served on the department as though it were named a party
_____(2) If the recipient has no legal representative and the third
party knows or reasonably should know that a recipient has no
representation then the third party shall provide notice to the
department within 60 days of receipt of a claim.
_____(3) In any civil action implicated by this section, the
department may file a notice of appearance and shall thereafter
have the right to file and receive pleadings, intervene and take
other action permitted by law.
_____(4) The department shall provide the recipient notice of the
amount of the purported subrogation lien within 30 days of receipt
of notice of the claim. The department shall provide related
supplements in a timely manner.
_____(c) Notice of settlement requirement.
_____(1) A recipient or his or her representative shall notify the
department of a settlement with a third-party and retain in escrow
an amount equal to the amount of the subrogation lien asserted by
the department. The notification shall include the amount of the
settlement being allocated for past medical expenses paid for by
the Medicaid program. Within 30 days of the receipt of any such
notice, the department shall notify the recipient of its consent or
rejection of the proposed allocation. If the department consents,
the recipient or his or her legal representation shall issue
payment out of the settlement proceeds in a manner directed by the
Secretary or his or her designee within 30 days of consent to the
_____(2) If the total amount of the settlement is less than the
department's subrogation lien, then the settling parties shall
obtain the department's consent to the settlement before finalized
the settlement. The department shall advise the parties within 30
days and provide a detailed itemization of all past medical
expenses paid by the department on behalf of the recipient for
which the department seeks reimbursement out of the settlement proceeds.
_____(3) If the department rejects the proposed allocation, the
department shall seek a judicial determination within 30 days and
provide a detailed itemization of all past medical expenses paid by
the department on behalf of the recipient for which the department
seeks reimbursement out of the settlement proceeds.
_____(A) If judicial determination becomes necessary, the trial
court is required to hold an evidentiary hearing. The recipient
and the department shall be provided ample notice of the same and
be given just opportunity to present the necessary evidence,
including fact witness and expert witness testimony, to establish
the amount to which the department is entitled to be reimbursed
pursuant to this section.
_____(B) The department shall have the burden of proving by a
preponderance of the evidence that the allocation agreed to by the
parties was improper. For purposes of appeal, the trial court's
decision should be set forth in a detailed order containing the
requisite findings of fact and conclusions of law to support its
_____(4) Any settlement by a recipient with one or more
third-parties which would otherwise fully resolve the recipient's
claim for an amount collectively not to exceed $20,000 shall be
exempt from the provisions of this section.
_____(5) Nothing herein prevents a recipient from seeking judicial intervention to resolve any dispute as to allocation prior to
effectuating a settlement with a third party.
_____(d) If the department fails to appropriately respond to a
notification of settlement, the amount to which the department is
entitled to be paid from the settlement shall be limited to the
amount of the settlement the recipient has allocated toward past
_____(e) Penalty for failure to notify the department. A legal
representative acting on behalf of a recipient or third party that
fails to comply with the provisions of this section is liable to
the department for all reimbursement amounts the department would
otherwise have been entitled to collect pursuant to this section
but for the failure to comply. Under no circumstances may a pro se
recipient be penalized for failing to comply with the provisions of
_____(f) Miscellaneous provisions relating to trial.
_____(1) Where an action implicated by this section is tried by a
jury, the jury may not be informed at any time as to the
subrogation lien of the department.
_____(2) Where an action implicated by this section is tried by
judge or jury, the trial judge shall, or in the instance of a jury
trial, require that the jury, identify precisely the amount of the
verdict awarded that represents past medical expenses.
_____(3) Upon the entry of judgment on the verdict, the court shall direct that upon satisfaction of the judgment any damages awarded
for past medical expenses be withheld and paid directly to the
department, not to exceed the amount of past medical expenses paid
by the department on behalf of the recipient.
_____(g) Attorneys' fees. Irrespective of whether an action or
claim is terminated by judgment or settlement without trial, from
the amount required to be paid to the department there shall be
deducted the reasonable costs and attorneys' fees attributable to
the amount in accordance with and in proportion to the fee
arrangement made between the recipient and his or her attorney of
record so that the department shall bear the pro-rata share of the
reasonable costs and attorneys' fees: Provided, that if there is
no recovery, the department shall under no circumstances be liable
for any costs or attorneys' fees expended in the matter.
_____(h) Class actions and multiple plaintiff actions not
authorized. Nothing in this article shall authorize the department
to institute a class action or multiple plaintiff action against
any manufacturer, distributor or vendor of any product to recover
medical care expenditures paid for by the Medicaid program.
_____(i) Secretary's authority. The Secretary or his or her
designee may compromise, settle and execute a release of any claim
relating to the department's right of subrogation, in whole or in
§9-8-3. Release of information.
(a) A recipient is considered to have authorized all third
parties to release to the department information needed by the
department to secure or enforce its rights as assignee under this
_____(b) As a condition of doing business in the state, health
insurers, including self-insured plans, group health plans as
defined in §6074(a) of the Employee Retirement Income Security Act
of 1974, service benefit plans, third-party administrators, managed
care organizations, pharmacy benefit managers or other parties that
are by statute, contract or agreement, legally responsible for
payment of a claim for a health care item or service are required
to comply with the following:
_____(1) Upon the request of the bureau, or its contractor, provide
information to determine the period that the service recipients,
their spouse or dependents may be or may have been covered by the
health insurer, including the nature of the coverage that is or was
provided by the health insurer, the name, address, date of birth,
Social Security number, group number, identifying number of the
plan, and effective and termination dates. The information shall be
provided in a format suitable for electronic data matches,
conducted under the direction of the department, no less than
monthly or as prescribed by the secretary. The health insurer shall
respond within sixty working days after receipt of a written
request for enrollment data from the department or its contractor;
_____(2) Accept the right of the bureau 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 by the bureau;
_____(3) Respond to any inquiry by the bureau regarding a claim for
payment for any health care item or service that is submitted not
later than three years after the date of the provision of the
health care item or service; and
_____(4) Accept a claim submitted by the bureau regardless of the
date of submission of the claim, the type or format of the claim
form, lack of preauthorization or the failure to present proper
documentation at the point-of-sale that is the basis of the claim:
Provided, That the claim is submitted by the bureau within the
three-year period beginning on the date on which the item or
service was furnished and any action by the bureau to enforce its
right with respect to the claim is commenced within six years of
the bureau's submission of the claim.
§9-8-4. Right of the department to recover medical assistance.
(a) Upon the death of a person who was fifty-five years of age
or older at the time the person received welfare assistance
consisting of nursing facility services, home and community-based
services, and related hospital and prescription drug services, the
department, in addition to any other available remedy, may file a
claim or lien against the estate of the recipient for the total amount of medical assistance provided by Medicaid for nursing
facility services, home and community-based services, and related
hospital and prescription drug services provided for the benefit of
the recipient. Claims so filed shall be classified as and included
in the class of debts due the state.
_____(b) The department may recover pursuant to subsection (a) only
after the death of the individual's surviving spouse, if any and
only after such time as the individual has no surviving children
under the age of twenty-one, or when the individual has no
surviving children who meet the Social Security Act's definition of
blindness or permanent and total disability.
_____(c) The state shall have the right to place a lien upon the
property of individuals who are inpatients in a nursing facility,
intermediate care facility for individuals with an intellectual
disability or other medical institution who, after notice and an
opportunity for a hearing, the state has deemed to be permanently
institutionalized. This lien shall be in an amount equal to
Medicaid expenditures for services provided by a nursing facility,
intermediate care facility for individuals with an intellectual
disability or other medical institution, and shall be rendered
against the proceeds of the sale of property except for a minimal
amount reserved for the individual's personal needs. A lien
dissolves upon that individual's discharge from the medical
institution. The secretary has authority to compromise or otherwise reduce the amount of this lien in cases where enforcement would
create a hardship.
_____(d) A lien may not be imposed on an individual's home when the
home is the lawful residence of:
_____(1) The spouse of the individual;
_____(2) The individual's child who is under the age of twenty-one;
_____(3) The individual's child meets the Social Security Act's
definition of blindness or permanent and total disability; or
_____(4) The individual's sibling has an equity interest in the
home and was residing in the home for a period of at least one year
immediately before the date of the individual's admission to a
_____(e) The filing of a claim, pursuant to this section, neither
reduces or diminishes the general claims of the department, except
that the department may not receive double recovery for the same
expenditure. The death of the recipient neither extinguishes or
diminishes any right of the department to recover. Nothing in this
section affects or prevents a proceeding to enforce a lien pursuant
to this section or a proceeding to set aside a fraudulent
_____(f) Any claim or lien imposed pursuant to this section is
effective for the full amount of medical assistance provided by
Medicaid for nursing facility services, home and community-based
services, and related hospital and prescription drug services. The lien attaches and is perfected automatically as of the beginning
date of medical assistance, the date when a recipient first
receives treatment for which the department may be obligated to
provide medical assistance. A claim may be waived by the
department, if the department determines, pursuant to applicable
federal law and rules and regulations, that the claim will cause
substantial hardship to the surviving dependents of the deceased.
§9-8-5. Previous judicial applications.
Case law previously applicable to article five, section 11,
11a, 11b and 11c of this chapter is applicable to this article
unless in conflict with these provisions.