Medicaid Subrogation Claims

Texas Medicaid Right of Recovery

Tex. Hum. Res. Code Sec.32.033 is the statute that creates the Texas Health and Human Services Commission's right of recovery. (To find the relevant sec. use the find control in your browser after you get to the general section.) The State has a separate cause of action against the tortfeasor for the amount it has paid for treatment for injuries in the accident. This is not a "lien" statute such a hospital may have for emergency care funds collected from the tortfeasor.

There are two types of claims, acute care and long term care. Different offices of the HHSC must be contacted. The Texas Medicaid & HealthCare Partnership handles casualty claims. Contact their web site for additional information and for the necessary authorization and notification forms (You must use Windows Explorer to contact this web site for these forms. 
They do not consider Chrome a secure browser). 

You must complete the Medical Authorization Form and the Tort Response Form before you will be provided information . On receipt of the tort response form, they should respond with 10 days usually with a subrogation letter and ten days later they should send an "amount letter". As in dealing with any agency, you should followup by phone to confirm that they received your notice and are sending the "amount letter". Be patient, but firm. These procedures are in a state of flux due to the federal "The Smart Act." The CMS has issued a interim final order. (it would help if they would speak English) with a comment peroid ending in November of 2013. These requlations will probably be implimented on January 1, 2014.

Although the telephone contact may be necessary to confirm which type of claim is involved, get the name of the contact and confirm any agreements in writing as you would in dealing with another attorney. The amount or character of the claims may change over time and should be confirmed in writing before any settlement is made.

A. Acute care claims.

Acute care claims are claims arising from an action that gives rise to a personal injury claim against a third party. The HHSC claim is against the portion of the claim that involves medical benefits (claims for pain and suffering cannot be used to avoid this claim, but it does not include property damage claims or loss of earnings).

1. Applicant's Duties

The applicant must notify the HHSC within 90 days of an unsettled tort claim, insurance coverage or potential cause of action.

2. Attorney's Duties

The attorney must notify the HHSC within 45 days of representation. The Tort Response Form should satisfy the content requirements.

3. Limit on attorney fees.

The attorney may not charge the client for recovery of Medicaid funds more than 15%.

4. Waiver of Attorney Fees.

The HHSC may waive recovery if the cost of recovery would exceed the amount that could be recovered. If the States waives recovery, the plaintiff's attorney must waive attorney fees on that portion of the settlement.

5. Balance Billing.

If a provider accepts Medicare payments they are prohibited from seeking the difference between their private rate and the Medicare reimbursement from the patient.

If there is a conflict over a waiver or reduction of an acute care claim, contact, Christy Dillman at christy.dillman@HHSC.state.tx.us.

B. Long Term Care Claims.

Long term care claims, including nursing home care, are for claims that do not fall in to the acute care category. The applicant's and the attorney's duties are the same as for acute care claims. The same limits for attorney fees and balance billing, also, apply. The same forms as are used for acute care claims should be used for long term care claims

The recovery a claim for long term care is handled by the Health and Human Services Commission. You may be involved with two sections of the same agency for the same transaction. The requlations are found at 1 Tex. Admin. Code Sec.354. The contact are:

Third party Recovery

P.O. Box 149081

Austin, Texas 78714-9081

Mail Code #-400

512-430-3400

For a reduction or waiver contact:

Staff Attorney

P.O.Box 149030

Austin, Texas 78714-9030

512-438-3126

This post is for information only by attorneys. It should not be considered as legal advice. If you are considering any action, contact an attorney personally as the facts of an individual case may change the action to be taken. If you decide to proceed without advice, you are on your own.

Most of the credit for this post goes to Pi-Yi Mayo of Baytown, Texas who submitted a paper on the same topic to the Advanced Personal Injury Law Course 2011. A more extensive treatment can be found on his web site.

Submitted by:

Ben A. Goff, Attorney

Mitchell, Goff & Mitchell, L.L.P.