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COMMITTEE REPORT
May 21, 2008
S. 669
S. Printed 5/21/08--H.
Read the first time March 6, 2008.
To whom was referred a Bill (S. 669) to amend the Code of Laws of South Carolina, 1976, by adding Section 43-7-465 so as to provide that all insurers that are responsible for payment of, etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass with amendment:
Amend the bill, as and if amended, by striking all after the enacting words and inserting:
/SECTION 1. Article 5, Chapter 7, Title 43 of the 1976 Code is amended by adding:
"Section 43-7-465. All A health insurers insurer, including a self-insured plans plan, group health plans plan as defined in Section 607(1) of the Employee Retirement Income Security Act of 1974, service-benefit plans plan, managed-care organizations organization, pharmacy benefit managers manager, or other another party that are is legally responsible for payment of a claim by statute, contract, or agreement for payment of a claim for a health care item or service, as a condition of doing business in this State, shall:
(1) provide, with respect to an individual eligible for or receiving medical assistance under the State plan, on request of the Single State Agency, information to determine during what period the individual or his spouse or dependent may be, or may have been, covered by a health insurer and the nature of coverage provided or that may have been provided by the insurer in a manner prescribed by the secretary of the United States Department of Health and Human Services or by the Single State Agency. This information must include the insured's name, address, and the plan's identifying number;
(2) accept the state's right of recovery and the assignment to the State of an individual or another entity's right to payment for a health care item or service for which payment was made under the State plan;
(3) respond to an inquiry by the State regarding a claim for payment for a health care item or service submitted within three years of the date the item or service was provided;
(4) agree not to deny a claim submitted by the State solely on the basis of the date the claim was submitted, the type or format of claim form, or a failure to present proper documentation at the point of sale that provides the basis of the claim if:
(a) the claim is submitted by the State within the three-year period beginning on the date on which the item or service was furnished; and
(b) an action by the State to enforce its right with respect to the claim is commenced with six years of the state's submission of the claim."
SECTION 2. Section 43-7-410 of the 1976 Code, as last amended by Act 481 of 1994, is further amended to read:
"Section 43-7-410. (A) 'Applicant' means an individual whose written application for Medicaid has been submitted to the agency determining Medicaid eligibility, but has not received final action. This includes an individual, (living or deceased,) whose application is submitted by a representative or a person acting responsibly for the individual.
(B) 'Commission Department' means the State South Carolina Department of Health and Human Services Finance Commission.
(C) 'Medicaid' means the medical assistance program authorized by Title XIX of the Social Security Act and administered by the State Health and Human Services Finance Commission department.
(D) 'Person' means any a natural person, company, association, partnership, corporation, or any other legal entity.
(E) 'Practitioner' means a physician or other health care professional licensed under state law to practice his profession.
(F) 'Private Insurer' means:
(1) a commercial insurance company offering health or casualty insurance to individuals or groups an individual or group, including an experienced-rated contracts and contract or indemnity contracts contract;
(2) a profit or nonprofit prepaid plan offering either a medical services service or full or partial payment for the diagnosis or treatment of an injury, disease, or disability;
(3) an organization administering a health or casualty insurance plans plan for a professional associations, unions association, union, fraternal groups group, employer-employee benefit plans, and any plan, or a similar organization offering these plans or services, including a self-insured and or self-funded plans plan; or
(4) a group health plan, as defined in Section 607(1) of the Employee Retirement Income Security Act of 1974, a service benefit plan, or a health maintenance organization.
(G) 'Provider' means an individual, firm, corporation, association, institution, or other legal entity which is providing, or has been is approved to provide, medical assistance to a recipient pursuant to the State Medical Assistance Plan and in accord consistent with Title XIX of the Social Security Act-Medical Assistance (Medicaid), also known as Medicaid.
(H) 'Recipient' means an individual who has been determined to be eligible for a health services as service described in the State Medical Assistance Plan in accord with Title XIX of the Social Security Act-Medical Assistance (Medicaid), also known as Medicaid.
(I) 'Third Party' means any an individual, entity, or program that is or may be liable by contract, agreement, or statute, to pay all or part of the medical cost of injury, disease, or disability of an applicant or recipient."
SECTION 3. Section 43-7-420 of the 1976 Code, as last amended by Act 516 of 1986, is further amended to read:
"Section 43-7-420. (A) Every An applicant or recipient, only to the extent of the amount of the medical assistance paid by Medicaid, shall be deemed is considered to have assigned his rights right to recover such amounts so an amount paid by Medicaid from any a third party or private insurer to the State Health and Human Services Finance Commission department. This assignment shall not include rights to Medicare benefits. The applicant or recipient shall cooperate fully with the State Health and Human Services Finance Commission department in its efforts to enforce its assignment rights. The receipt of medical assistance by an applicant or recipient shall create a rebuttable presumption that the applicant or recipient received information regarding the requirements for and the consequences of assigning his right to recover from a third party or private insurer either from the department, or in the case of an applicant or recipient qualified by the Social Security Administration under Section 1634 of the Social Security Act, from the Social Security Administration.
(B) An applicant's and recipient's determination of, and continued eligibility for, medical assistance under Medicaid is contingent upon on his cooperation with the Commission department in its efforts to enforce its assignment rights. Cooperation includes, but is not limited to, reimbursing the Commission department from proceeds or payments received by the applicant or recipient from any a third party or private insurer.
(C) Every An applicant or recipient is considered to have authorized all persons, including insurance companies and providers of medical care, to release to the Commission all department information needed to enforce the assignment rights of the Commission department."
SECTION 4. Section 43-7-430 of the 1976 Code, as last amended by Act 516 of 1986, is further amended to read:
"Section 43-7-430. (A) The State Health and Human Services Finance Commission shall be department automatically is subrogated, only to the extent of the amount of medical assistance paid by Medicaid, to the rights an applicant or recipient may have has to recover such amounts so an amount paid by Medicaid from any a third party or private insurer. The applicant or recipient shall cooperate fully with the State Health and Human Services Finance Commission department and shall do nothing after medical assistance is provided to prejudice the subrogation rights of the State Health and Human Services Finance Commission department.
(B) An applicant's and recipient's determination of, and continued eligibility for, medical assistance under Medicaid is contingent upon on his cooperation with the Commission department in its efforts to enforce its subrogation rights. Cooperation includes, but is not limited to, reimbursing the Commission department from proceeds or payments received by the recipient from any a third party or private insurer. (C) Every An applicant or recipient is considered to have authorized all persons, including insurance companies and providers of medical care, to release to the Commission all department information needed to enforce the subrogation rights of the Commission department."
SECTION 5. Section 43-7-440 of the 1976 Code, as last amended by Act 481 of 1994, is further amended to read: "Section 43-7-440. (A) The Commission department, to enforce its assignment or subrogation rights, may take any one, or any combination of, the following actions:
(1) intervene or join in an action or proceeding brought by the applicant or recipient against any a third party, or private insurer, in state or federal court.;
(2) commence and prosecute legal proceedings against any a third party or private insurer who may be liable to any an applicant or recipient in state or federal court, either alone or in conjunction with the applicant or recipient, his guardian, personal representative of his estate, dependents dependent, or survivors survivor;
(3) commence and prosecute a legal proceedings proceeding against any a third party or private insurer who may be liable to an applicant or recipient, or his guardian, personal representative of his estate, dependents dependent, or survivors survivor;
(4) commence and prosecute a legal proceedings proceeding against any an applicant or recipient;
(5) settle and compromise any an amount due to the State Health and Human Services Finance Commission department under its assignment and subrogation rights. Provided, further, any A representative or attorney retained by an applicant or recipient shall not be considered liable to State Health and Human Services Finance Commission the department for improper settlement, compromise, or disbursement of funds unless he has written notice of State Health and Human Services Finance Commission's the department's assignment and subrogation rights prior to disbursement of funds; or
(6) reduce any an amount due to the State Health and Human Services Finance Commission department by twenty-five percent if the applicant or recipient has retained an attorney to pursue the applicant's or recipient's claim against a third party or private insurer, that amount to represent the State Health and Human Services Finance Commission's department's share of attorney's attorney fees paid by the applicant or recipient. Additionally, the State Health and Human Services Finance Commission may, in its discretion, department may share in other costs of litigation by reducing the amount due it by a percentage of those costs, the percentage calculated by dividing the amount due the State Health and Human Services Finance Commission department by the total settlement received from the third party or private insurer. Provided, further, any A representative or attorney retained by an applicant or recipient shall not be considered liable to State Health and Human Services Finance Commission the department for improper settlement, compromise, or disbursement of funds unless he has written notice by certified mail of State Health and Human Services Finance Commission's the department's assignment and subrogation rights prior to disbursement of funds.
(B) A Providers and practitioners provider or practitioner who participate participates in the Medicaid program shall cooperate with the Commission department in the identification of all third parties whom they have reason to believe may be liable to pay all or part of the medical costs of the injury, disease, or disability of an applicant or recipient.
(C) Any A provision in the contract of a private insurer issued or renewed after June 11, 1986, which denies or reduces benefits because of the eligibility of the insured to receive assistance under Medicaid, is null and void. In enrolling a person or in making payments for benefits to a person or on behalf of a person, no a private insurer may not take into account that the person is eligible for or is provided receives medical assistance under a State Plan for Medical Assistance pursuant to Title XIX of the Social Security Act.
(D) The An assignment and or subrogation rights right of the Commission are department is superior to any right of reimbursement, subrogation, or indemnity of any a third party or recipient. Provided, further, any A representative or attorney retained by an applicant or recipient shall not be considered liable to State Health and Human Services Finance Commission the department for improper settlement, compromise, or disbursement of funds unless he has written notice of State Health and Human Services Finance Commission's the department's assignment and subrogation rights prior to disbursement of funds. In a case Where a third party has a legal liability to make payments a payment for medical assistance to or on behalf of a person, to the extent that payment has been made under a State Plan for Medical Assistance pursuant to Title XIX of the Social Security Act for health care items or services furnished to the person, the State is considered to have acquired the rights of the person to payment by any other another party for the health care items or services, to the extent that payment was made under a State Plan for Medical Assistance pursuant to Title XIX of the Social Security Act for a health care item or service furnished to the person."
SECTION 6. Section 43-7-460 of the 1976 Code, as last amended by Act 93 of 1997, is further amended to read:
"Section 43-7-460. (A) The State Department of Health and Human Services department shall seek recovery of medical assistance paid under the Title XIX State Plan for Medical Assistance from the estate of an individual who:
(1) at the time of death was an inpatient in a nursing facility, intermediate care facility for the mentally retarded, or other medical institution if the individual is required, as a condition of receiving services a service in the facility under the state plan, to spend for costs the cost of medical care all but a minimal amount of the person's income required for personal needs; or
(2) was fifty-five years of age or older when the individual received medical assistance, but only for medical assistance consisting of a nursing facility services service, home and community-based services, and service, hospital and or prescription drug services service provided to individuals in nursing facilities an individual or a nursing facility, or receiving a home and community-based services service.
(B) Recovery under this section may be made only after the death of the decedent's surviving spouse, if any one exists, and only at a time when the decedent has no surviving child under age twenty-one or no child who is blind or permanently and totally disabled as defined in Title XVI of the Social Security Act.
(C) Recovery under this section must be waived by the department upon proof of undue hardship, asserted by an heir or devisee of the property claimed pursuant to 42 U.S.C. 1396p(b)(3) and in accordance with the guidance issued by the Secretary of the United States Department of Health and Human Services in the State Medicaid Manual as incorporated into the State Plan. The department shall publish and maintain such guidance on the department's web site. Until conflicting hardship standards and criteria are issued by the Secretary of the United States Department of Health and Human Services, The following are considered instances of undue hardship in which recovery must be waived:
(1) with respect to the decedent's home property, if the decedent could have transferred the home property on or after the date of his or her Medicaid application without incurring a penalty under 42 U.S.C. Section 1396p(c), if the property could have been transferred without penalty to a:
(a) spouse who has survived the decedent;
(b) surviving child of the decedent who was under age twenty-one or blind or totally disabled;
(c) surviving sibling of the decedent who possessed an equity interest in the property and who lived in the home for a period of at least one year immediately prior to the date the decedent was institutionalized; or
(d) surviving child of the deceased who lived in the home for a period of at least two years immediately before the decedent became institutionalized and who provided care which allowed the decedent to delay institutionalization. However, hardship under this item only applies if the individual to whom the property could have been transferred without penalty is actually residing in the home at the time the hardship is claimed and this hardship status only protects up to one hundred thousand dollars of appraised value of the home property and to the extent the appraised value of the home property exceeds one hundred thousand dollars, that portion of the value that exceeds one hundred thousand dollars, is subject to recovery by the department as otherwise authorized under this section ;
(2) with respect to the decedent's home and one acre of land surrounding the house, if an immediate family member:
(a) has resided in the home for at least two years immediately prior to the recipient's death;
(b) is actually residing in the home at the time the hardship is claimed;
(c) owns no other real property or agrees to sell all other interest in real property and give the proceeds to the department; and
(d) has annual gross family income that does not exceed one hundred eighty-five percent of the federal poverty guidelines.
(3) with respect to an income producing asset:
(a) the spouse's or immediate family member's annual gross family income would fall below the federal poverty guidelines without the income produced by the asset; and
(b) at the time of death, the asset is not producing annual income in excess of one hundred eighty-five percent of the federal poverty guidelines or the spouse or immediate family member agrees to pay all income in excess of one hundred eighty-five percent of the federal poverty guidelines to the department until the department recovers all medical assistance due under this section.
(D) Recovery of a medical assistance payments payment under this section applies to medical assistance paid after June 30, 1994.
(E) A claims claim against an estate under this section have has priority as established in Section 62-3-805(a)(2)(ii).
(F) For purposes of this section:
(1) 'Estate' means all real and property, personal property, and other assets included within the individual's estate as defined in Section 62-1-201(11);.
(2) the 'State plan' means Title XIX State Plan for Medical Assistance in effect at the decedent's death;.
(3) 'Immediate family member' means a child, grandchild, parent, brother, or sister of the deceased. (G) Notwithstanding subsection (A)(2) upon the enactment of any amendments an amendment to federal law which grants states the option to exempt home and community-based services or other noninstitutional Medicaid services from the estate recovery provisions mandated by Section 13612 of the federal Omnibus Budget Reconciliation Act of 1993, the State Health and Human Services Finance Commission department shall seek recovery of medical assistance paid under the Title XIX State Plan for Medical Assistance from the estate of an individual who:
(1) at the time of death was an inpatient in a nursing facility, intermediate care facility for the mentally retarded, or other medical institution if the individual is required, as a condition of receiving services in the facility under the state plan, to spend for costs of medical care all but a minimal amount of the person's income required for personal needs; or
(2) was fifty-five years of age or older when the individual received medical assistance but only for medical assistance consisting of nursing facility services."
SECTION 7. This act takes effect upon approval by the Governor./
Renumber sections to conform.
Amend title to conform.
LEON HOWARD for Committee.
EXPLANATION OF IMPACT:
The Department of Health and Human Services and the Department of Insurance report this bill will have no impact on the General Fund of the State or on federal and/or other funds, as it merely establishes criteria insurers must meet as a condition of conducting business in South Carolina.
Approved By:
Harry Bell
Office of State Budget
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 43-7-465 SO AS TO PROVIDE THAT ALL INSURERS THAT ARE RESPONSIBLE FOR PAYMENT OF A CLAIM FOR A HEALTH CARE ITEM OR SERVICE AS A CONDITION OF DOING BUSINESS IN THIS STATE SHALL PROVIDE INFORMATION TO THE DEPARTMENT OF HEALTH AND HUMAN SERVICES ON INDIVIDUALS WHO RECEIVE MEDICAL ASSISTANCE UNDER THE STATE PLAN, SHALL ACCEPT THE STATE'S RIGHT OF RECOVERY OF CERTAIN PAYMENTS MADE UNDER THE STATE PLAN, SHALL RESPOND TO CLAIMS, AND SHALL AGREE NOT TO DENY CLAIMS ON THE BASIS OF THE TIME THE CLAIM WAS FILED, IF TIMELY FILED, THE FORMAT OF THE CLAIM FORM, OR FAILURE TO PRESENT DOCUMENTATION AT THE POINT OF SALE THAT IS THE BASIS OF THE CLAIM.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Article 5, Chapter 7, Title 43 of the 1976 Code is amended by adding:
"Section 43-7-465. All health insurers, including self-insured plans, group health plans, as defined in Section 607(1) of the Employee Retirement Income Security Act of 1974, service benefit plans, 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, as a condition of doing business in South Carolina, shall:
(1) provide, with respect to individuals who are eligible for, or are provided, medical assistance under the state plan, upon the request of the Department of Health and Human Services, information to determine during what period the individual or the individual's spouse or dependents may be, or may have been, covered by a health insurer and the nature of the coverage that is or was provided by the health insurer, including the name, address, and identifying number of the plan, in a manner prescribed by the Secretary of the United States Health and Human Services;
(2) accept the state's right of recovery and the assignment to the State any right of an individual or other entity to payment from the party for an item of service for which payment has been made under the state plan;
(3) respond to any inquiry by the State 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) agree not to deny a claim submitted by the State solely on the basis of the date of submission of the claim, the type or format of the claim form, or a failure to present proper documentation at the point-of-sale that is the basis of the claim, if:
(a) the claim is submitted by the State within the three-year period beginning on that date on which the item or service was furnished; and
(b) any action by the State to enforce its rights with respect to the claim is commenced within six years of the state's submission of the claim."
SECTION 2. This act takes effect upon approval by the Governor.
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