Revision 18-1; Effective March 1, 2018

 

 

D–7100 Texas Administrative Code Rules

Revision 09-4; Effective December 1, 2009

 

§358.219. Third-party Resources.

(a) Medicaid is considered the payor of last resort for a person's medical expenses. As a condition of eligibility, in accordance with 42 CFR §§433.138 - 433.148, an applicant or recipient must:

(1) assign to the Texas Health and Human Services Commission (HHSC) the applicant's or recipient's right to recover any third-party resources available for payment of medical expenses covered under the Texas State Plan for Medical Assistance; and

(2) report to HHSC any third-party resource within 60 days after learning about the third-party resource.

(b) If HHSC determines that a person's employer-based health insurance is cost-effective, the person must participate in HHSC's Health Insurance Premium Payment program as a condition of eligibility. HHSC denies eligibility to a person who voluntarily drops his or her employer-based health insurance or fails to provide HHSC with the information needed to determine cost effectiveness.

 

D–7200 Cooperation and Assignment of Rights for Medicaid Eligibility

Revision 09-4; Effective December 1, 2009

 

Texas requires, as conditions of Medicaid eligibility, that a person must:

  • cooperate in providing any third-party resource (TPR) information to HHSC; and
  • agree to the assignment of rights (AOR) of any TPR benefits to HHSC.

Medicaid is usually the payer of last resort. A TPR is a source of payment for medical expenses other than the person, HHSC or Medicaid. A TPR must be applied toward the person's medical and health expenses.

Under state law, an applicant or recipient of Medicaid automatically gives HHSC his/her right to financial recovery from personal health insurance, other recovery sources or personal injuries, to the extent HHSC has paid for medical services. This allows HHSC to recover the costs of medical services paid by the Medicaid program. Any applicant or recipient who knowingly withholds information regarding any sources of payment for medical services violates state law.

Fraud Referrals — Medicaid recipients must report any TPR within 60 days of learning about the coverage or liability. An applicant or recipient who knowingly withholds information regarding any sources of payment for medical services violates state law.

Refer the person for fraud, if the person:

  • fails to report any TPR coverage or liability within 60 days; or
  • does not reimburse HHSC when a third-party payment for medical services is received and the expenditure is $100 or more.

Denial — Deny the person if the person refuses to:

  • cooperate in providing TPR information; or
  • agree to the AOR of TPR benefits to HHSC.

See Appendix XVI, Documentation and Verification Guide.

 

D–7300 Potential Sources of Third-Party Coverage

Revision 18-1; Effective March 1, 2018

 

TPRs include:

  • health insurance;
  • group health plans;
  • government health insurance;
  • liability or casualty insurance and court settlements; and
  • long-term care insurance policies.

A TPR is any individual, entity or program, including health insurance, that is or may be legally liable to pay all or part of the costs for medical assistance before money from the Medicaid program is spent.

 

D–7310 Examples of Third-Party Resources

Revision 18-1; Effective March 1, 2018

 

Examples of TPRs include, but are not limited to, the following:

  • health insurance;
  • self-insured plans;
  • group health plans;
  • service benefit plans;
  • employer, private purchase; and
    • union membership-based health insurance;
    • sheltered workshops;
    • continuation of health insurance coverage under statute (COBRA continuation);
    • and coverage available from an employer under the Employee Retirement Income Security Act (ERISA);
  • medical support derived from noncustodial parents;
  • armed forces and the public health service;
  • pending lawsuits or no-fault clauses or state laws covering accidents, product liability and workers' compensation;
  • employee conversion/extension rights;
  • fraternal and benefit societies and churches and church groups;
  • Insurance purchased or endowed as part of a college fee;
  • membership in a health maintenance organization (except for those with a contract under Medicare/Medicaid);
  • pharmacy other insurance;
  • worker's compensation;
  • government health insurance;
  • liability or casualty insurance and court settlements;
  • insurance (including automobile, homeowners and medical malpractice);
  • indemnity plans (if review of the plan determines that the policy provides for payment of health care items or services, including policies that pay a cash benefit to the policyholder if the payment is conditional upon the occurrence of a medical event);
  • long-term care insurance policies;
  • any other parties that are, by statute, contract, or agreement legally responsible for paying a claim for a health care item or service; and
  • Medicare.

Liability or casualty insurance and court settlements — Accidental injuries may result in third parties being liable for medical expenses. The usual sources of payment for medical expenses in these situations are automobile insurance; homeowners insurance; owners', landlords' and tenants' insurance; workers' compensation and lawsuit settlements.

Individual or group health insurance — Health insurance policies include individual or group contracts and commercial hospital, medical and surgical policies. A recipient may have medical insurance coverage from current employment, residual coverage from previous employment or private insurance paid for by the recipient or a relative. A recipient's relative may have personal or group insurance that covers the recipient's medical expenses.

TRICARE, formerly known as CHAMPUS, is a health insurance plan available to dependent children and spouses of active, retired and deceased military services personnel.

Parts A and B of Medicare provide a TPR for Medicaid recipients entitled to Medicare.

 

D–7400 Use of Third-Party Resources

Revision 18-1; Effective March 1, 2018

 

Effective Feb. 22, 2013, HHSC (formerly DADS) implemented a Cost Avoidance method of Third Party Recovery for Nursing Facility, Hospice, and Non-State Intermediate Care Facility for Persons with Intellectual Disabilities (ICF/IID). Cost Avoidance requires that the provider bill the client’s long term care insurance (if applicable) before billing Medicaid. This ensures that Medicaid is the payer of last resort.

A person must reimburse HHSC as soon as they receive the third-party payment for medical services already paid by Medicaid.

A provider who receives a third party payment for services Medicaid has already paid must process an adjustment claim to report the third party payment amount on the claim.  The Medicaid paid claim is reduced by the amount of the other insurance payment reported on the adjustment claim.  Providers can contact Texas Medicaid and Healthcare Partnership (TMHP) for assistance with adjustment claims at 800-626-4117 option 3. To report other insurance coverage for a Medicaid individual, contact TMHP at the same number as above, option 6.

The two methods for using TPRs are:

  • cost avoidance, which is the method of Third Party Recovery the Centers for Medicare and Medicaid Services (CMS) requires, in which available benefits are applied before Medicaid payment is made; and
  • post-payment recovery, in which Medicaid pays the medical costs before seeking reimbursement. This method is typically used when Medicaid is unaware of the TPR at the time of billing, or the TPR is not eligible for use at the time of billing (e.g., a trust or annuity).

 

D–7410 Cost Avoidance

Revision 18-1; Effective March 1, 2018

 

Inform the person to:

  • use health insurance as a resource;
  • tell medical providers that the person has insurance coverage; and
  • show providers any insurance identification card the person may have.
If the person, the employer or other sources indicate that ... then complete ...
Medicaid-eligible household members have private health insurance coverage, information about the private health insurance on:
  • the TPR screen in TIERS. This screen will interface with the TMHP TPR Unit.
  • report any changes in insurance coverage for existing recipients via the TPR screen in TIERS.
health insurance coverage is available for Medicaid-eligible household members, but the members are not enrolled in the health insurance plan, information about the available health insurance on:
  • the TPR screen in TIERS. This screen will interface with the TMHP TPR Unit. The TMHP TPR Unit will use the information to initiate an inquiry about Health Insurance Premium Payment (HIPP) program eligibility.

To contact the TPR Unit with questions or problems concerning TPR:

HIPP Program Notes: Individuals approved for the HIPP Program receive reimbursement for the employee’s portion of an employer-sponsored health insurance premium payment. For eligibility and co-payment calculations, HIPP reimbursement checks are not considered income.  For co-payment calculations, the reimbursed health insurance premium payment is not considered an incurred medical expense.

TMHP will take action to deny all benefits to a recipient who voluntarily drops his or her health insurance coverage or fails to provide TMHP with the information needed to determine cost effectiveness.

A recipient cannot appeal decisions made by TMHP. To obtain assistance in resolving problems or issues concerning HIPP, contact the TPR HIPP Unit at 800-440-0493.

For more information about the HIPP program, see HHS' HIPP website: https://hhs.texas.gov/services/financial/health-insurance-premium-payment-hipp-program.

Recipients may also call 800-440-0493 for more information.

 

D–7420 Post-Payment Recovery

Revision 18-1; Effective March 1, 2018

 

Major sources for post-payment recovery are liability or casualty insurance and court settlements resulting from accidental injuries. If a recipient reports an injury that requires medical treatment for which liability or casualty insurance may provide payment, ask the recipient to provide the date of the accident.

Report the recipient’s name, Medicaid number, and date of the accident to the HHSC TPR Unit and Provider Recoupment and Holds.

Third Party Recovery

HHSC OIG/TPR Unit
Mail Code 1354
4900 North Lamar Blvd.
Austin, TX 78751

Information can be sent via email to:

MCD_Third_Party@hhsc.state.tx.us; and

Provider Recoupments and Holds

Texas Health and Human Services Commission
Mail Code W-406
P.O. Box 149030
Austin, TX 78714-9030
701 W. 51st Street
Austin, TX 78751

When the TPR Unit at HHSC becomes aware of accidental injuries, it will seek cost recovery from recipients who receive a health insurance or settlement payment for medical services already paid by Medicaid.

Use Form H1210, Subrogation (Trusts/Annuities/Court Settlements), to report to Provider Claims any potential subrogation funds available from trusts, annuities and court settlements.

When a recipient reimburses HHSC for medical expenses, the reimbursement should be in the form of a personal check, cashier's check or money order. If reimbursement is received from a recipient, follow these steps:

Step Procedure
1 Give the recipient Form H4100, Money Receipt.
2 Enter the types and dates of the medical services in the "For" section of Form H4100.
3 If unsure about which medical services are involved, attach a memorandum giving as much information as possible about the reimbursement.
4 Attach a copy of any other information identifying the nature of the payment, such as a statement from the insurance company.
5 Send the reimbursement, a copy of Form H4100, and other information, if any, to HHSC Accounts Receivable, P.O. Box 149055, Mail Code 1470, Austin, TX 78714-9055.

 

State office verifies the actual claims paid by Medicaid and refunds any overpayment.

 

D–7500 Third-Party Resources for SSI Recipients

Revision 18-1; Effective March 1, 2018

 

Because the Social Security Administration (SSA) determines eligibility for Supplemental Security Income (SSI) recipients, Medicaid eligibility specialists are not routinely involved in TPR information from these individuals. Instead, at the time an SSI recipient is certified for Medicaid and annually thereafter, the state office generates a letter to the recipient requesting information about any insurance coverage they may have. The recipient completes the insurance questionnaire enclosed with the letter and returns it in the envelope provided for that purpose directly to:

Texas Medicaid and Healthcare Partnership (TMHP)
Third Party Resources Unit
P.O. Box 202948
Austin, TX 78720-2948

TMHP enters data from the returned insurance questionnaire into the TPR system. TMHP also maintains a toll-free number (800-846-7307, option 2) that SSI recipients may use to ask questions about the form or about their health insurance.

SSA also reports TPR information for SSI recipients to HHSC. An SSI recipient who refuses to cooperate with HHSC in verifying TPR is ineligible for Medicaid.

Occasionally, an SSI recipient may ask for an explanation or help completing the insurance questionnaire. Explain the purpose of the form and the proper use of available TPRs and help the recipient complete and submit the form, if necessary. If an SSI recipient asks about a change in insurance coverage or about the availability of TPRs related to accidental injury, have the recipient report this information to the TPR Unit at 800-846-7307, option 2 or:

Texas Medicaid and Healthcare Partnership
Third Party Resources Unit
P.O. Box 202948
Austin, TX 78720-2948

 

D–7510 Social Security Administration (SSA) Role and Supplemental Security Income (SSI) Recipients

Revision 09-4; Effective December 1, 2009

 

In Texas, SSA must inform SSI applicants and recipients and SSI recipients who move to Texas about the requirement under Section D-7200, Cooperation and Assignment of Rights for Medicaid Eligibility.

 

D–7600 Long-Term Care Insurance Policies

Revision 17-1; Effective March 1, 2017

 

Long-term care insurance policies pay for nursing facility care. The policies purchased by individuals specify the benefits covered. Long-term care insurance policies do not affect Medicaid eligibility. For individuals who have such policies, report the policies as a third-party resource (TPR), using Form H1039, Medical Insurance Input.

As of March 1, 2015, HHSC Provider Recoupment and Holds cannot accept other insurance payments for individuals when a managed care organization (MCO) pays the nursing facility claims. Nursing facility providers must contact the appropriate MCO for claims submitted on Medicaid eligible individuals enrolled in MCOs on or after March 1, 2015 with service dates on or after March 1, 2015.

For questions about other insurance on Fee-for-Service (FFS) claims or for claims submitted prior to March 1, 2015, contact HHSC Provider Claims Services at 512-438-2200, Option 4.

Send long-term care insurance checks to Provider Claims Services at the Texas Health and Human Services Commission. The payment of large sums from long-term care insurance companies may affect an individuals' resource eligibility if Provider Claims Services provides a refund.

Procedure for TPR checks received for long-term care insurance coverage on FFS claims:

  • give the recipient Form H4100, Money Receipt, correctly documented; and
  • send the check, a copy of Form H4100 and other information to:

Provider Recoupments and Holds, W-406
P.O. Box 149081
Austin, TX 78714-9081

The policy and procedures in this section do not apply to Long-Term Care Partnership (LTCP) qualified policies. Information for LTCP qualified policies is located in Chapter P, Long-Term Care Partnership (LTCP) Program.

 

D–7700 Health Insurance Premium Payment Reimbursement Program

Revision 18-1; Effective March 1, 2018

 

The HIPP program is a Medicaid benefit that helps families pay for employer-sponsored health insurance.

To qualify for HIPP, an employee must either be Medicaid eligible or have a family member who is Medicaid eligible. The HIPP program may pay for individuals and their family members who receive, or have access to, employer-sponsored health insurance benefits when it is determined that the cost of insurance premiums is less than the cost of projected Medicaid expenditures.

Note: An employee and the employee's Medicaid-eligible family member must be enrolled in the employer-sponsored health insurance in order to receive HIPP reimbursements.

Medicaid-eligible HIPP enrollees do not have to pay out-of-pocket deductibles, co-payments, or co-insurance for health care services that Medicaid covers when seeing a provider that accepts Medicaid. Instead, Medicaid reimburses providers for these expenses.

HIPP enrollees who are not Medicaid eligible must pay deductibles, co-payments, and co-insurance required under the employer's group health insurance policy.

Report individuals who are potentially eligible for HIPP on Form H1039, Medical Insurance Input. Send Form H1039 to HHSC's Third Party Resource (TPR) Unit, Mail Code 1354, or send via email to: MCD_Third_Party@hhsc.state.tx.us.

For the Medicaid Buy-In for Children (MBIC) program, when employer-sponsored insurance is entered into the Texas Integrated Eligibility Redesign System (TIERS), this information is automatically sent to HIPP. HIPP eligibility does impact the MBIC premium amount. See Section N-7400, Premium Amounts.

HHSC's TPR Unit refers Form H1039 to the current state Medicaid contractor, TMHP. If TMHP determines it is cost-effective for Medicaid to pay the individual's employer-sponsored health insurance premiums, then TMHP sends:

  • a letter to the individual and requests verification of the employer-sponsored insurance plan and premium payments; and
  • a premium reimbursement to the individual upon receipt of complete documentation and proof of the premium payment.

Note: Because an employer-sponsored health insurance premium deduction has already been counted as part of the recipient's income, a HIPP reimbursement check sent to recipients by TMHP is not income. Do not consider an incurred medical deduction for the reimbursed premium as income for recipients participating in HIPP.

TMHP will terminate HIPP enrollment if the individual is no longer enrolled in  health insurance coverage or fails to provide TMHP with the information needed to determine cost effectiveness or proof of premium payments.

For more information about the HHSC's HIPP program, see HHSC's website: https://hhs.texas.gov/services/financial/health-insurance-premium-payment-hipp-program, or contact the Medicaid HIPP program at MCD_HIPP_Program@hhsc.state.tx.us.

Individuals may call 800-440-0493 for more information. Individuals may also visit the HIPP website at https://hhs.texas.gov/services/financial/health-insurance-premium-payment-hipp-program.

 

D–7800 Medicaid Estate Recovery Program

Revision 18-1; Effective March 1, 2018

 

Another post-payment resource is through the MERP. On March 1, 2005, Texas implemented MERP in compliance with federal Medicaid and state laws. The program is managed by HHSC. Under this program, HHSC may file a claim against the estate of a deceased Medicaid recipient who: 1) was age 55 or older at the time Medicaid services were received; and 2) initially applied for certain long-term care services and supports on or after March 1, 2005. The most complete, current and accurate source of information regarding MERP is the HHS website, Medicaid Estate Recovery Program.

Long-term care services and supports that are subject to MERP include:

  • nursing facility services;
  • intermediate care facilities for individuals with an intellectual disability or related conditions (ICF/IID) services, which include state supported living centers;
  • Medicaid waiver programs, such as:
    • Community Living Assistance and Support Services (CLASS);
    • Deaf Blind with Multiple Disabilities (DBMD);
    • Home and Community-based Services (HCS);
    • Texas Home Living Program (TxHmL); and
    • STAR+PLUS Waiver (SPW);
  • Community Attendant Services (CAS); and
  • related hospital and prescription drug services.

Notes:

  • A person who is placed on an interest list for a Medicaid waiver program is not considered to have applied.
  • If a person, aged 55 or older, was eligible for Medicaid or received other Medicaid-paid benefits, such as QMB, SLMB or QI-1, before March 1, 2005, but did not initially apply for or transfer to one of the types of long-term care services and supports subject to MERP until March 1, 2005, or after, the person's estate is subject to recovery of the cost of certain long-term care services and supports received after March 1, 2005.

The acceptance of Medicaid assistance for the covered long-term care services provides a basis for a Class 7 probate claim. (This means there are six other classes of claims that receive priority in payment from the estate before Texas gets paid.) HHSC files a MERP claim in probate court against the estate of a deceased Medicaid recipient to recover the cost of certain Medicaid long-term care services and supports received by the Medicaid recipients. MERP will follow claims procedures specified in the Texas Estates Code and HHSC’s Medicaid Estate Recovery Program rules found at 1 TAC, Part 15, Chapter 373.

For notification requirements, see Section B-2620, HHSC MERP Notification Requirements.