WELFARE AND INSTITUTIONS CODE
SECTION 14124.70-14124.94
14124.70. As used in this article:
(a) "Carrier" includes any insurer as defined in Section 23 of the
Insurance Code, including any private company, corporation, mutual
association, trust fund, reciprocal or interinsurance exchange
authorized under the laws of this state to insure persons against
liability or injuries caused to another, and also any insurer
providing benefits under a policy of bodily injury liability
insurance covering liability arising out of the ownership,
maintenance or use of a motor vehicle which provides uninsured
motorist endorsement or coverage, pursuant to Section 11580.2 of the
Insurance Code.
(b) "Beneficiary" means any person who has received benefits or
will be provided benefits under this chapter because of an injury for
which another person or party may be liable. It includes such
beneficiary's guardian, conservator or other personal representative,
his estate or survivors.
(c) "Reasonable value of benefits" means both of the following:
(1) Except in a case in which services were provided to a
beneficiary under a managed care arrangement or contract, "reasonable
value of benefits" means the Medi-Cal rate of payment, for the type
of services rendered, under the schedule of maximum allowances
authorized by Section 14106 or, the Medi-Cal rate of payment, for the
type of services rendered, under regulations adopted pursuant to
this chapter, including but not limited, to Section 14105.
(2) If services were provided to a beneficiary under a managed
care arrangement or contract, "reasonable value of benefits" means
the rate of payment to the provider by the plan for the services
rendered to the beneficiary, except in cases where the plan pays the
provider on a capitated or risk sharing basis, in which case it means
the value of the services rendered to the beneficiary calculated by
the plan as the usual customary and reasonable charge made to the
general public by the provider for similar services.
(d) "Lien" means the director's claim for recovery, from a
beneficiary's tort action or claim, of the reasonable value of
benefits provided on behalf of the beneficiary.
14124.71. (a) When benefits are provided or will be provided to a
beneficiary under this chapter because of an injury for which another
person is liable, or for which a carrier is liable in accordance
with the provisions of any policy of insurance issued pursuant to
Insurance Code Section 11580.2, the director shall have a right to
recover from such person or carrier the reasonable value of benefits
so provided. The Attorney General, or counsel for the fiscal
intermediary under the Medi-Cal program with the permission of the
Attorney General, or a contractor pursuant to Section 14124.80, or a
county through its civil legal adviser, may, to enforce such right,
institute and prosecute legal proceedings against the third person or
carrier who may be liable for the injury in an appropriate court,
either in the name of the director or in the name of the injured
person, his guardian, conservator, personal representative, estate,
or survivors.
(b) The director may:
(1) Compromise, or settle and release any such claim, or
(2) Waive any such claim, in whole or in part, for the convenience
of the director, or if the director determines that collection would
result in undue hardship upon the person who suffered the injury, or
in a wrongful death action upon the heirs of the deceased.
(c) No action taken in behalf of the director pursuant to this
section or any judgment rendered in such action shall be a bar to any
action upon the claim or cause of action of the beneficiary, his
guardian, conservator, personal representative, estate, dependents,
or survivors against the third person who may be liable for the
injury, or shall operate to deny to the beneficiary the recovery for
that portion of any damages not covered hereunder.
(d) The cost of a service provided to an eligible developmentally
disabled Medi-Cal beneficiary under Section 14132.44 may be recovered
by the director from a liable third person or an insurance carrier.
14124.72. (a) Where an action is brought by the director pursuant
to Section 14124.71, it shall be commenced within the period
prescribed in Section 338 of the Code of Civil Procedure.
(b) The death of the beneficiary does not abate any right of
action established by Section 14124.71.
(c) When an action or claim is brought by persons entitled to
bring such actions or assert such claims against a third party who
may be liable for causing the death of a beneficiary, any settlement,
judgment or award obtained is subject to the director's right to
recover from that party the reasonable value of the benefits provided
to the beneficiary under the Medi-Cal program, as provided in
subdivision (d).
(d) Where the action or claim is brought by the beneficiary alone
and the beneficiary incurs a personal liability to pay attorney's
fees and costs of litigation, the director's claim for reimbursement
of the benefits provided to the beneficiary shall be limited to the
reasonable value of benefits provided to the beneficiary under the
Medi-Cal program less 25 percent which represents the director's
reasonable share of attorney's fees paid by the beneficiary and that
portion of the cost of litigation expenses determined by multiplying
by the ratio of the full amount of the reasonable value of benefits
so provided to the full amount of the judgment, award, or settlement.
14124.73. (a) If either the beneficiary or the director brings an
action or claim against such third person or carrier the beneficiary
or the director shall within 30 days of filing the action give to the
other written notice by personal service or registered mail of the
action or claim, and of the name of the court or state or local
agency in which the action or claim is brought. Proof of such notice
shall be filed in such action or claim. If an action or claim is
brought by either the director or the beneficiary, the other may, at
any time before trial on the facts, become a party to, or shall
consolidate his action or claim with the other if brought
independently.
(b) If an action or claim is brought by the director pursuant to
subdivision (a) of Section 14124.71, written notice to the
beneficiary, guardian, conservator, personal representative, estate
or survivor given pursuant to this section shall advise him of his
right to intervene in the proceeding, his right to obtain a private
attorney of his choice, and the director's right to recover the
reasonable value of the benefits provided.
14124.74. In the event of judgment or award in a suit or claim
against a third party or carrier:
(a) If the action or claim is prosecuted by the beneficiary alone,
the court or agency shall first order paid from any judgment or
award the reasonable litigation expenses incurred in preparation and
prosecution of the action or claim, together with reasonable attorney'
s fees, when an attorney has been retained. After payment of these
expenses and attorney's fees the court or agency shall, on the
application of the director, allow as a first lien against the amount
of the settlement, judgment, or award the reasonable value of
additional benefits provided to the beneficiary under the Medi-Cal
program, as provided in subdivision (d) of Section 14124.72, and as a
second lien, the amount of any claims, pursuant to Section 14019.3,
owed to a provider, as provided in Section 14124.791.
(b) If the action or claim is prosecuted both by the beneficiary
and the director, the court or agency shall first order paid from any
judgment or award, the reasonable litigation expenses incurred in
preparation and prosecution of the action or claim, together with
reasonable attorney's fees based solely on the services rendered for
the benefit of the beneficiary. After payment of these expenses and
attorney's fees, the court or agency shall first apply out of the
balance of the judgment or award an amount sufficient to reimburse
the director the full amount of the reasonable value of benefits
provided on behalf of the beneficiary under the Medi-Cal program, and
then an amount sufficient to reimburse a provider who has filed a
lien for any claims for services rendered to the beneficiary, as
provided under Section 14124.791.
14124.75. The court or agency shall, upon further application at
any time before the judgment or award is satisfied, allow as a
further lien the reasonable value of additional benefits provided
arising out of the same cause of action or claim provided on behalf
of the beneficiary under the Medi-Cal Program, where such benefits
were provided or became payable subsequent to the original order.
14124.76. (a) No settlement, judgment, or award in any action or
claim by a beneficiary to recover damages for injuries, where the
director has an interest, shall be deemed final or satisfied without
first giving the director notice and a reasonable opportunity to
perfect and to satisfy the director's lien. Recovery of the director'
s lien from an injured beneficiary's action or claim is limited to
that portion of a settlement, judgment, or award that represents
payment for medical expenses, or medical care, provided on behalf of
the beneficiary. All reasonable efforts shall be made to obtain the
director's advance agreement to a determination as to what portion of
a settlement, judgment, or award that represents payment for medical
expenses, or medical care, provided of behalf on the beneficiary.
Absent the director's advance agreement as to what portion of a
settlement, judgment, or award represents payment for medical
expenses, or medical care, provided on behalf of the beneficiary, the
matter shall be submitted to a court for decision. Either the
director or the beneficiary may seek resolution of the dispute by
filing a motion, which shall be subject to regular law and motion
procedures. In determining what portion of a settlement, judgment, or
award represents payment for medical expenses, or medical care,
provided on behalf of the beneficiary and as to what the appropriate
reimbursement amount to the director should be, the court shall be
guided by the United States Supreme Court decision in Arkansas
Department of Health and Human Services v. Ahlborn (2006) 547 U.S.
268 and other relevant statutory and case law.
(b) If the beneficiary has filed a third-party action or claim,
the court where the action or claim was filed shall have jurisdiction
over a dispute between the director and the beneficiary regarding
the amount of a lien asserted pursuant to this section that is based
upon an allocation of damages contained in a settlement or compromise
of the third-party action or claim. If no third-party action or
claim has been filed, any superior court in California where venue
would have been proper had a claim or action been filed shall have
jurisdiction over the motion. The motion may be filed as a special
motion and treated as an ordinary law and motion proceeding and
subject to regular motion fees. The reimbursement determination
motion shall be treated as a special proceeding of a civil nature
pursuant to Part 3 (commencing with Section 1063) of the Code of
Civil Procedure. When no action is pending, the person making the
motion shall be required to pay a first appearance fee. When an
action is pending, the person making the motion shall pay a regular
law and motion fee. Notwithstanding Section 1064 of the Code of Civil
Procedure, either the beneficiary or the director may appeal the
final findings, decision, or order.
(c) The court shall issue its findings, decision, or order, which
shall be considered the final determination of the parties' rights
and obligations with respect to the director's lien, unless the
settlement is contingent on an acceptable allocation of the
settlement proceeds, in which case, the court's findings, decision,
or order shall be considered a tentative determination. If the
beneficiary does not serve notice of a rejection of the tentative
determination, which shall be based solely upon a rejection of the
contingent settlement, within 30 days of the notice of entry of the
court's tentative determination, subject to further consideration by
the court pursuant to subdivision (d), the tentative determination
shall become final. Notwithstanding Section 1064 of the Code of Civil
Procedure, either the beneficiary or the director may appeal the
final findings, decision, or order.
(d) If the beneficiary does not accept the tentative
determination, which shall be based solely upon a rejection of the
contingent settlement, any party may subsequently seek further
consideration of the court's findings upon application to modify the
prior findings, decision, or order based on new or different facts or
circumstances. The application shall include an affidavit showing
what application was made before, when, and to what judge, what order
or decision was made, and what new or different facts or
circumstances, including a different settlement, are claimed to
exist. Upon further consideration, the court may modify the
allocation in the interest of fairness and for good cause.
14124.77. When the director has perfected a lien upon a judgment or
award in favor of a beneficiary against any third party for an
injury for which the beneficiary has received benefits under the
Medi-Cal Program, the director shall be entitled to a writ of
execution as lien claimant to enforce payment of said lien against
such third party with interest and other accruing costs as in the
case of other executions. In the event the amount of such judgment or
award so recovered has been paid to the beneficiary, the director
shall be entitled to a writ of execution against such beneficiary to
the extent of the director's lien, with interest and other accruing
costs as in the case of other executions.
14124.78. Notwithstanding any other provision of law, in no event
shall the director recover more than the beneficiary recovers after
deducting, from the settlement judgment, or award, attorney's fees
and litigation costs paid for by the beneficiary. If the director's
recovery is determined under this section, the reductions in
subdivision (d) of Section 14124.72 shall not apply.
14124.785. The director's recovery is limited to the amount derived
from applying Section 14124.72, 14124.76, or 14124.78, whichever is
less.
14124.79. In the event that the beneficiary, his guardian,
conservator, personal representative, estate or survivors or any of
them brings an action against the third person who may be liable for
the injury, notice of institution of legal proceedings, notice of
settlement and all other notices required by this code shall be given
to the director in Sacramento except in cases where the director
specifies that notice shall be given to the Attorney General. All
such notices shall be given by insurance carriers, as described in
Section 14124.70, having liability for the beneficiary's claim, and
by the attorney retained to assert the beneficiary's claim, or by the
injured party beneficiary, his guardian, conservator, personal
representative, estate or survivors, if no attorney is retained.
14124.791. (a) Subject to the director's prior right of recovery, a
provider who has rendered services to a beneficiary because of an
injury for which a third party is liable and who has received payment
under the Medi-Cal program shall be entitled to file a lien for all
fees for services provided to the beneficiary against any judgment,
award, or settlement obtained by the beneficiary or the director
against that third party. A provider may only recover upon the lien
if the provider has made a full reimbursement of any fees paid by the
department for those services.
(b) If either the beneficiary or the director brings an action or
claim against the third party, the party bringing the action shall,
within 30 days of bringing the action, give written notice to any
provider who is eligible to file a lien under subdivision (a) of the
action and of the name of the court or state or local agency in which
the action or claim is brought. Notice shall be given by personal
service or registered mail, and proof of service shall be filed in
the action or claim.
(c) The provider's claim for reimbursement for fees for services
rendered to the beneficiary shall be limited to the amount of the
fees less 25 percent, which represents the provider's reasonable
share of attorneys' fees for prosecution of the action and of the
cost of litigation expense.
(d) No claim authorized by this section shall be permitted to the
extent that the claim would reduce the director's right to recover
pursuant to Section 14124.78.
14124.792. If any provision of this article, or the application of
any provision of this article to any person, firm, corporation, or
other entity or to any circumstance or situation, shall be held
invalid, the remaining provisions of this article shall not be
affected thereby, and shall be given effect.
14124.795. It is the intent of the Legislature to comply with
federal law requiring that when a beneficiary has other available
health coverage or insurance, the Medi-Cal program shall be the payer
of last resort. Notwithstanding any other provision of law, any
carrier described in Section 14124.70, including automobile,
casualty, property, and malpractice insurers, shall enter into an
agreement with the department to permit and assist the matching of
the department's Medi-Cal eligibility file against the carrier's
claim files, utilizing, if necessary, social security numbers as
common identifiers for the purpose of determining whether Medi-Cal
benefits were provided to a beneficiary because of an injury for
which another person is liable, or for which a carrier is liable in
accordance with the provisions of any policy of insurance. The
carrier shall maintain a centralized file of claimants' names,
mailing addresses, and social security numbers or dates of birth.
This information shall be made available to the department upon the
department's reasonable request. The agreement described in this
section shall include financial arrangements for reimbursing carriers
for necessary costs incurred in furnishing requested information.
14124.80. The Legislature finds and declares that:
(a) Many instances of potential third-party liability,
particularly workers' compensation claims, are not discovered by the
department. Similarly, the Legislature finds that there are private
nongovernmental sources of potential claim information which is
unique to these private sources and not otherwise readily available
to the department. This private information is unique in that,
although the information may be shared between private claimants,
including potential private lienors, the department is not privy to
it and includes past adjudicated claims, expired or expiring health
policy claims, long-term care and settlement situations where
Medi-Cal is not identified in any application or filing for benefits.
Additionally, there are applications and other filings made without
any identification of potential Medi-Cal rights which become known to
private sources because of this information sharing system. Further,
there are other miscellaneous claims that have not been and will not
be discovered in the ordinary course of administration by the
department.
(b) There is a backlog of potential claims or liens which could
result in the recovery of substantial amounts if private sources of
information were available to the state.
(c) A cost-effective manner of recovering these potentially large
amounts is through the contracting by the state, on a pilot program
basis, with a private organization which possesses the expertise and
resources required to rapidly discover and recover the lienable
amounts owing by third parties for health care services provided by
the Medi-Cal program, and which will receive compensation on a
contingency fee arrangement, thereby supplementing the ongoing
functions of the state in recovering lienable amounts, reducing the
cost to the state of the recovery effort, and maximizing the amounts
recovered for the Medi-Cal program.
(d) Attorneys or the beneficiary, his guardian, personal
representative, estate or survivors of any of them who are currently
mandated under Section 14124.79 to report Medi-Cal involvement are
excluded from any further remuneration benefits under this section.
14124.81. The State Department of Health Services shall administer
the provisions of Sections 14124.82 to 14124.88, inclusive. The
department shall establish a pilot project for the discovery and
recovery of amounts owing by third parties for health care services
provided by the Medi-Cal program.
14124.82. (a) The department shall enter, by October 1, 1981, into
at least two at-risk performance type contracts with private
organizations that have access to information on cases with potential
for the recovery of amounts owing for services rendered under the
Medi-Cal program, and that have access to a substantial backlog
period of information on past due Medi-Cal claims, as well as current
and future potential claims. At least one contract shall cover
northern California claims, and at least one contract shall cover
southern California claims. Any contractor, otherwise qualified under
this section, may separately contract in each geographical area.
(b) Priority, by the terms of the contract or contracts, shall be
given to the identification and recovery of claims nearing the
statute of limitations, prior adjudicated claims, and prior existing
injury claims. However, all claims which are older, in whole or part,
than 12 months, at the time of discovery and notification by the
contractor to the department, shall be subject to contractual lien
recovery unless departmental personnel have previously identified
these claims and have filed appropriate liens, notices, or other
payment demands. A claim arises and the 12-month period begins when
the department or its fiscal agent has first made payment for medical
services related to the personal or workers' compensation action on
behalf of a given recipient. The department may waive any time
requirement, if it concludes that it will not otherwise discover the
claim and be able to effect recovery.
14124.83. The agreement shall include, but is not limited to, the
following provisions:
(a) The contractor shall discover and recover amounts owing by
third parties which may be subject to a claim for reimbursement.
(b) Payment to the contractor shall be based upon a no cost
percentage of recovery formula, which shall not exceed 25 percent of
the gross recovery upon the claim. It is the intent of the
Legislature that "no cost" include all considerations for court
costs, legal fees, and the universe of the case processing activity,
not including, however, departmental processing.
(c) The contractor shall report periodically to the department
concerning its progress in the discovery of cases and the recovery of
amounts subject to claim, and shall provide such other information
as the department may require to adequately monitor the progress of
the contractor. Reports and other information shall be required only
at one-month intervals.
14124.84. The department shall provide the contractor with such
information as is reasonably necessary for the contractor to perform
its obligations under the contract, including accounting data and
other information the contractor may request.
14124.85. The contractor, for the duration of the contract period,
shall have the powers of the Director of the State Department of
Health Services as set forth in this article, except for the power to
waive a claim under paragraph (2) of subdivision (b) of Section
14124.71. The contract shall specify the particular means and
documentation of the delegation of powers under paragraph (1) of
subdivision (b) of Section 14124.71. The contractor shall be subject
to the provisions of Section 14100.2 except that those provisions
shall not inhibit performance of the contract.
14124.86. The pilot project contract entered into by the department
pursuant to Section 14124.82 shall not exceed a term of three years
from the date of its execution. The contractor shall retain its
rights and duties under the contract with respect to any claims or
liens processed in whole or in part prior to the termination date of
the agreement.
14124.88. (a) Subsequent to the expiration of the pilot project
contract, the department, in its reasonable discretion, may execute a
separate, additional agreement for the discovery and recovery of
amounts which may be subject to claim pursuant to this article,
subject to Sections 14124.81 to 14124.87, inclusive.
(b) The department, if it receives a competitive qualified offer
of such services within the criteria set forth in Sections 14124.80
through 14124.87, shall separately contract for discovery and
recovery of workers' compensation claims with one contract to cover
areas of northern California and one to cover areas of southern
California.
(c) (1) Priority and inclusion of claims shall be as set forth in
subdivision (b) of Section 14124.82 and additionally shall include
any matter on file with the Workers' Compensation Appeals Board for a
period of more than 12 months unless the department has previously
identified these claims and has filed the appropriate lien or liens.
(2) The contract may include, or may be subsequently amended to
include, any or all previously identified claims and any other
potential lien claims, identified or not, if the department
determines that it will not otherwise be able to effectively process
recovery. This paragraph shall cease to be operative on January 1,
1995.
(d) There shall be no cost to the contractor for claim detail
reports provided by the fiscal intermediary. In all cases of workers'
compensation appeals, payment shall be made directly to the state
and a contractor shall not handle or have access to any moneys owing
the state. In these cases a bond required by the state for collection
agencies shall be sufficient. Contractor's files shall be subject to
audit, pursuant to the contract, but shall remain the property of
the contractor. At the request of the department, the contractor
shall provide copies of any claims related to a particular recovery.
(e) The contract shall provide that the contractor, with the
permission of the Attorney General, may appeal decisions of the
Workers' Compensation Appeals Board.
14124.89. (a) Every health insurer, self-insured plan, group health
plan, as defined in Section 607(1) of the Employee Retirement Income
Security Act of 1974, service benefit plan, managed care
organization, including health care service plans as defined in
subdivision (f) of Section 1345 of the Health and Safety Code,
licensed pursuant to the Knox-Keene Health Care Service Plan Act of
1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the
Health and Safety Code), pharmacy benefit manager, or other party
that is, by statute, contract, or agreement, legally responsible for
payment of a claim for a health care item or service shall, upon
request of the department for any records, or any information
contained in records pertaining to an individual or group health
insurance policy or plan issued by such insurer or plan against, or
pertaining to the medical or dental benefits paid by or claims made
against such insurer or plans under a policy or plan, make the
requested records or information available upon a certification by
the department that the individual is an applicant for or recipient
of services under this chapter or is a person who is legally
responsible for such an applicant or recipient.
(b) The department shall enter into a cooperative agreement
setting forth mutually agreeable procedures for requesting and
furnishing appropriate information, not inconsistent with any law
pertaining to the confidentiality and privacy of medical records,
which procedure shall include such financial arrangements as may be
necessary to reimburse insurers or plans for necessary costs incurred
in furnishing requested information, and the time and manner such
procedures are to become effective. Reimbursement to insurers or
plans complying with the provisions of this section shall be at the
same rate of reimbursement used to reimburse the Department of Motor
Vehicles for providing information to insurance carriers.
(c) The information required to be made available pursuant to this
section shall be limited to information necessary to determine
whether health benefits have been or should have been claimed and
paid pursuant to a health insurance policy or plan with respect to
items of medical care and services received by a particular
individual for which Medi-Cal coverage would otherwise be available.
(d) Not later than the date upon which the procedures agreed to
pursuant to subdivision (b) become effective, the director shall
establish guidelines to assure that information relating to an
individual certified to be an applicant for or recipient of medical
assistance, furnished to any insurer or plan pursuant to this
section, is used only for the purpose of identifying the records or
information requested in such manner so as not to violate the
confidentiality of an applicant or recipient.
(e) The department shall implement the provisions of this section
by January 1, 1983.
14124.90. It is the intent of the Legislature to comply with
federal law requiring that when a beneficiary has third-party health
coverage or insurance, the State Department of Health Services shall
be the payer of last resort. In order to assess overlapping or
duplicate health coverage, every health insurer, self-insured plan,
group health plan, as defined in Section 607(1) of the Employee
Retirement Income Security Act of 1974, service benefit plan, managed
care organization, including health care service plans as defined in
subdivision (f) of Section 1345 of the Health and Safety Code,
licensed pursuant to the Knox-Keene Health Care Service Plan Act of
1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the
Health and Safety Code), pharmacy benefit manager, or other party
that is, by statute, contract, or agreement, legally responsible for
payment of a claim for a health care item or service shall maintain a
centralized file of the subscribers', policyholders', or enrollees'
names, mailing addresses, and social security numbers or date of
birth, and where available, for all other covered persons, the names
and social security numbers or date of birth. This information shall
be made available to the State Department of Health Services upon
reasonable request. Notwithstanding Section 20134 of the Government
Code, the Board of Administration of the California Public Employees'
Retirement System and affiliated systems or contract agencies shall
permit data matches with the state department to identify Medi-Cal
beneficiaries with third-party health coverage or insurance. A
recipient's Medi-Cal identification card shall, where information is
available, contain information advising providers of health care
services of any third-party health coverage for the recipient.
Providers shall seek reimbursement from available third-party health
coverage before billing the Medi-Cal program.
14124.91. The State Department of Health Services shall, whenever
it is cost-effective, pay the premium for third-party health coverage
for beneficiaries under this chapter. The State Department of Health
Services shall, when a beneficiary's third-party health coverage
would lapse due to loss of employment or change in health status,
lack of sufficient income or financial resources, or any other
reason, continue the health coverage by paying the costs of
continuation of group coverage pursuant to federal law or converting
from a group to an individual plan, whenever it is cost-effective.
Notwithstanding any other provision of a contract or of law, the time
period for the department to exercise either of these options shall
be 60 days from the date of lapse of the policy.
14124.92. (a) The department may pay administrative expenses and
make incentive payments to any county, state, or federal agency, or a
contracting agent of the department for identifying and reporting
third-party health care coverage held or offered to beneficiaries
under this chapter.
(b) Unless the third-party health care coverage identified is
excluded under subdivision (d) from the incentive payment plan, an
agency or contractor may be entitled to an incentive payment if the
agency or contractor does all of the following:
(1) Identifies a case of which the department was not previously
aware.
(2) Provides to the department adequate and necessary information
relevant to the third-party health care coverage in order to make a
claim for benefits or reimbursement for services rendered that would
otherwise be paid by Medi-Cal.
(3) Reports to the department the identified third-party health
care coverage within 30 days of the date of discovery on a form
approved by the department.
(c) In no event shall any one incentive for each case identified
exceed one month of savings received by the department for benefits
paid by the third-party health care coverage.
(d) Third-party health care coverage that does not qualify for the
incentive payment plan under this section shall be identified by the
department based on policy limitations and cost-effectiveness. The
types of coverage that do not qualify under this section include
those that to which any of the following apply:
(1) Not specifically intended to provide third-party health care
coverage, such as coverage that provides life or car insurance
benefits, periodic benefits for disability or hospitalization, or
income protection.
(2) Coverage is limited to a specific diagnosis, unless the
beneficiary has been diagnosed with a condition or disease specified
in the coverage.
(3) Coverage is limited to a specific circumstance, such as
accidental injury or dismemberment.
(4) Coverage is limited to one specific category of service.
(e) For the purposes of this section, "third-party health care
coverage" means health care service plans, benefits, insurance
policies, and funds, including those described in Section 14124.90.
14124.93. (a) The Department of Child Support Services shall
provide payments to the local child support agency of fifty dollars
($50) per case for obtaining third-party health coverage or insurance
of beneficiaries, to the extent that funds are appropriated in the
annual Budget Act.
(b) A county shall be eligible for a payment if the county obtains
third-party health coverage or insurance for applicants or
recipients of Title IV-D services not previously covered, or for whom
coverage has lapsed, and the county provides all required
information on a form approved by both the Department of Child
Support Services and the State Department of Health Care Services.
(c) Payments to the local child support agency under this section
shall be suspended for the 2003-04, 2004-05, 2005-06, 2006-07,
2007-08, 2008-09, 2009-10, 2010-11, and 2011-12 fiscal years.
14124.94. (a) When the rights of a Medi-Cal beneficiary to health
care benefits from an insurer have been assigned to the department,
an insurer shall not impose any requirement on the department that is
different from any requirement applicable to an agent or any
assignee of the covered beneficiary.
(b) The department, in the administration of the Medi-Cal program,
may garnish the wages, salary, or other employment income of, and
withhold amounts from state tax refunds from, any person to whom both
of the following apply:
(1) The person is required by a court or administrative order to
provide coverage of the costs of health services to a child who is
eligible for medical assistance under the Medi-Cal program.
(2) The person has received payment from a third party for the
costs of the health services for the child, but he or she has not
used the payments to reimburse, as appropriate, either the other
parent or the person having custody of the child, or the provider of
the health services, to the extent necessary to reimburse the
department for expenditures for those costs under the Medi-Cal
program. All claims for current or past due child support shall take
priority over claims made by the department for the costs of Medi-Cal
services.
(c) For purposes of this section, "insurer" includes every health
insurer, self-insured plan, group health plan, as defined in Section
607(1) of the Employee Retirement Income Security Act of 1974,
service benefit plan, managed care organization, including health
care service plans as defined in subdivision (f) of Section 1345 of
the Health and Safety Code, licensed pursuant to the Knox-Keene
Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with
Section 1340) of Division 2 of the Health and Safety Code), pharmacy
benefit manager, or other party that is, by statute, contract, or
agreement, legally responsible for payment of a claim for a health
care item or service.
WELFARE AND INSTITUTIONS CODE
SECTION 14124.70-14124.94
14124.70. As used in this article:
(a) "Carrier" includes any insurer as defined in Section 23 of the
Insurance Code, including any private company, corporation, mutual
association, trust fund, reciprocal or interinsurance exchange
authorized under the laws of this state to insure persons against
liability or injuries caused to another, and also any insurer
providing benefits under a policy of bodily injury liability
insurance covering liability arising out of the ownership,
maintenance or use of a motor vehicle which provides uninsured
motorist endorsement or coverage, pursuant to Section 11580.2 of the
Insurance Code.
(b) "Beneficiary" means any person who has received benefits or
will be provided benefits under this chapter because of an injury for
which another person or party may be liable. It includes such
beneficiary's guardian, conservator or other personal representative,
his estate or survivors.
(c) "Reasonable value of benefits" means both of the following:
(1) Except in a case in which services were provided to a
beneficiary under a managed care arrangement or contract, "reasonable
value of benefits" means the Medi-Cal rate of payment, for the type
of services rendered, under the schedule of maximum allowances
authorized by Section 14106 or, the Medi-Cal rate of payment, for the
type of services rendered, under regulations adopted pursuant to
this chapter, including but not limited, to Section 14105.
(2) If services were provided to a beneficiary under a managed
care arrangement or contract, "reasonable value of benefits" means
the rate of payment to the provider by the plan for the services
rendered to the beneficiary, except in cases where the plan pays the
provider on a capitated or risk sharing basis, in which case it means
the value of the services rendered to the beneficiary calculated by
the plan as the usual customary and reasonable charge made to the
general public by the provider for similar services.
(d) "Lien" means the director's claim for recovery, from a
beneficiary's tort action or claim, of the reasonable value of
benefits provided on behalf of the beneficiary.
14124.71. (a) When benefits are provided or will be provided to a
beneficiary under this chapter because of an injury for which another
person is liable, or for which a carrier is liable in accordance
with the provisions of any policy of insurance issued pursuant to
Insurance Code Section 11580.2, the director shall have a right to
recover from such person or carrier the reasonable value of benefits
so provided. The Attorney General, or counsel for the fiscal
intermediary under the Medi-Cal program with the permission of the
Attorney General, or a contractor pursuant to Section 14124.80, or a
county through its civil legal adviser, may, to enforce such right,
institute and prosecute legal proceedings against the third person or
carrier who may be liable for the injury in an appropriate court,
either in the name of the director or in the name of the injured
person, his guardian, conservator, personal representative, estate,
or survivors.
(b) The director may:
(1) Compromise, or settle and release any such claim, or
(2) Waive any such claim, in whole or in part, for the convenience
of the director, or if the director determines that collection would
result in undue hardship upon the person who suffered the injury, or
in a wrongful death action upon the heirs of the deceased.
(c) No action taken in behalf of the director pursuant to this
section or any judgment rendered in such action shall be a bar to any
action upon the claim or cause of action of the beneficiary, his
guardian, conservator, personal representative, estate, dependents,
or survivors against the third person who may be liable for the
injury, or shall operate to deny to the beneficiary the recovery for
that portion of any damages not covered hereunder.
(d) The cost of a service provided to an eligible developmentally
disabled Medi-Cal beneficiary under Section 14132.44 may be recovered
by the director from a liable third person or an insurance carrier.
14124.72. (a) Where an action is brought by the director pursuant
to Section 14124.71, it shall be commenced within the period
prescribed in Section 338 of the Code of Civil Procedure.
(b) The death of the beneficiary does not abate any right of
action established by Section 14124.71.
(c) When an action or claim is brought by persons entitled to
bring such actions or assert such claims against a third party who
may be liable for causing the death of a beneficiary, any settlement,
judgment or award obtained is subject to the director's right to
recover from that party the reasonable value of the benefits provided
to the beneficiary under the Medi-Cal program, as provided in
subdivision (d).
(d) Where the action or claim is brought by the beneficiary alone
and the beneficiary incurs a personal liability to pay attorney's
fees and costs of litigation, the director's claim for reimbursement
of the benefits provided to the beneficiary shall be limited to the
reasonable value of benefits provided to the beneficiary under the
Medi-Cal program less 25 percent which represents the director's
reasonable share of attorney's fees paid by the beneficiary and that
portion of the cost of litigation expenses determined by multiplying
by the ratio of the full amount of the reasonable value of benefits
so provided to the full amount of the judgment, award, or settlement.
14124.73. (a) If either the beneficiary or the director brings an
action or claim against such third person or carrier the beneficiary
or the director shall within 30 days of filing the action give to the
other written notice by personal service or registered mail of the
action or claim, and of the name of the court or state or local
agency in which the action or claim is brought. Proof of such notice
shall be filed in such action or claim. If an action or claim is
brought by either the director or the beneficiary, the other may, at
any time before trial on the facts, become a party to, or shall
consolidate his action or claim with the other if brought
independently.
(b) If an action or claim is brought by the director pursuant to
subdivision (a) of Section 14124.71, written notice to the
beneficiary, guardian, conservator, personal representative, estate
or survivor given pursuant to this section shall advise him of his
right to intervene in the proceeding, his right to obtain a private
attorney of his choice, and the director's right to recover the
reasonable value of the benefits provided.
14124.74. In the event of judgment or award in a suit or claim
against a third party or carrier:
(a) If the action or claim is prosecuted by the beneficiary alone,
the court or agency shall first order paid from any judgment or
award the reasonable litigation expenses incurred in preparation and
prosecution of the action or claim, together with reasonable attorney'
s fees, when an attorney has been retained. After payment of these
expenses and attorney's fees the court or agency shall, on the
application of the director, allow as a first lien against the amount
of the settlement, judgment, or award the reasonable value of
additional benefits provided to the beneficiary under the Medi-Cal
program, as provided in subdivision (d) of Section 14124.72, and as a
second lien, the amount of any claims, pursuant to Section 14019.3,
owed to a provider, as provided in Section 14124.791.
(b) If the action or claim is prosecuted both by the beneficiary
and the director, the court or agency shall first order paid from any
judgment or award, the reasonable litigation expenses incurred in
preparation and prosecution of the action or claim, together with
reasonable attorney's fees based solely on the services rendered for
the benefit of the beneficiary. After payment of these expenses and
attorney's fees, the court or agency shall first apply out of the
balance of the judgment or award an amount sufficient to reimburse
the director the full amount of the reasonable value of benefits
provided on behalf of the beneficiary under the Medi-Cal program, and
then an amount sufficient to reimburse a provider who has filed a
lien for any claims for services rendered to the beneficiary, as
provided under Section 14124.791.
14124.75. The court or agency shall, upon further application at
any time before the judgment or award is satisfied, allow as a
further lien the reasonable value of additional benefits provided
arising out of the same cause of action or claim provided on behalf
of the beneficiary under the Medi-Cal Program, where such benefits
were provided or became payable subsequent to the original order.
14124.76. (a) No settlement, judgment, or award in any action or
claim by a beneficiary to recover damages for injuries, where the
director has an interest, shall be deemed final or satisfied without
first giving the director notice and a reasonable opportunity to
perfect and to satisfy the director's lien. Recovery of the director'
s lien from an injured beneficiary's action or claim is limited to
that portion of a settlement, judgment, or award that represents
payment for medical expenses, or medical care, provided on behalf of
the beneficiary. All reasonable efforts shall be made to obtain the
director's advance agreement to a determination as to what portion of
a settlement, judgment, or award that represents payment for medical
expenses, or medical care, provided of behalf on the beneficiary.
Absent the director's advance agreement as to what portion of a
settlement, judgment, or award represents payment for medical
expenses, or medical care, provided on behalf of the beneficiary, the
matter shall be submitted to a court for decision. Either the
director or the beneficiary may seek resolution of the dispute by
filing a motion, which shall be subject to regular law and motion
procedures. In determining what portion of a settlement, judgment, or
award represents payment for medical expenses, or medical care,
provided on behalf of the beneficiary and as to what the appropriate
reimbursement amount to the director should be, the court shall be
guided by the United States Supreme Court decision in Arkansas
Department of Health and Human Services v. Ahlborn (2006) 547 U.S.
268 and other relevant statutory and case law.
(b) If the beneficiary has filed a third-party action or claim,
the court where the action or claim was filed shall have jurisdiction
over a dispute between the director and the beneficiary regarding
the amount of a lien asserted pursuant to this section that is based
upon an allocation of damages contained in a settlement or compromise
of the third-party action or claim. If no third-party action or
claim has been filed, any superior court in California where venue
would have been proper had a claim or action been filed shall have
jurisdiction over the motion. The motion may be filed as a special
motion and treated as an ordinary law and motion proceeding and
subject to regular motion fees. The reimbursement determination
motion shall be treated as a special proceeding of a civil nature
pursuant to Part 3 (commencing with Section 1063) of the Code of
Civil Procedure. When no action is pending, the person making the
motion shall be required to pay a first appearance fee. When an
action is pending, the person making the motion shall pay a regular
law and motion fee. Notwithstanding Section 1064 of the Code of Civil
Procedure, either the beneficiary or the director may appeal the
final findings, decision, or order.
(c) The court shall issue its findings, decision, or order, which
shall be considered the final determination of the parties' rights
and obligations with respect to the director's lien, unless the
settlement is contingent on an acceptable allocation of the
settlement proceeds, in which case, the court's findings, decision,
or order shall be considered a tentative determination. If the
beneficiary does not serve notice of a rejection of the tentative
determination, which shall be based solely upon a rejection of the
contingent settlement, within 30 days of the notice of entry of the
court's tentative determination, subject to further consideration by
the court pursuant to subdivision (d), the tentative determination
shall become final. Notwithstanding Section 1064 of the Code of Civil
Procedure, either the beneficiary or the director may appeal the
final findings, decision, or order.
(d) If the beneficiary does not accept the tentative
determination, which shall be based solely upon a rejection of the
contingent settlement, any party may subsequently seek further
consideration of the court's findings upon application to modify the
prior findings, decision, or order based on new or different facts or
circumstances. The application shall include an affidavit showing
what application was made before, when, and to what judge, what order
or decision was made, and what new or different facts or
circumstances, including a different settlement, are claimed to
exist. Upon further consideration, the court may modify the
allocation in the interest of fairness and for good cause.
14124.77. When the director has perfected a lien upon a judgment or
award in favor of a beneficiary against any third party for an
injury for which the beneficiary has received benefits under the
Medi-Cal Program, the director shall be entitled to a writ of
execution as lien claimant to enforce payment of said lien against
such third party with interest and other accruing costs as in the
case of other executions. In the event the amount of such judgment or
award so recovered has been paid to the beneficiary, the director
shall be entitled to a writ of execution against such beneficiary to
the extent of the director's lien, with interest and other accruing
costs as in the case of other executions.
14124.78. Notwithstanding any other provision of law, in no event
shall the director recover more than the beneficiary recovers after
deducting, from the settlement judgment, or award, attorney's fees
and litigation costs paid for by the beneficiary. If the director's
recovery is determined under this section, the reductions in
subdivision (d) of Section 14124.72 shall not apply.
14124.785. The director's recovery is limited to the amount derived
from applying Section 14124.72, 14124.76, or 14124.78, whichever is
less.
14124.79. In the event that the beneficiary, his guardian,
conservator, personal representative, estate or survivors or any of
them brings an action against the third person who may be liable for
the injury, notice of institution of legal proceedings, notice of
settlement and all other notices required by this code shall be given
to the director in Sacramento except in cases where the director
specifies that notice shall be given to the Attorney General. All
such notices shall be given by insurance carriers, as described in
Section 14124.70, having liability for the beneficiary's claim, and
by the attorney retained to assert the beneficiary's claim, or by the
injured party beneficiary, his guardian, conservator, personal
representative, estate or survivors, if no attorney is retained.
14124.791. (a) Subject to the director's prior right of recovery, a
provider who has rendered services to a beneficiary because of an
injury for which a third party is liable and who has received payment
under the Medi-Cal program shall be entitled to file a lien for all
fees for services provided to the beneficiary against any judgment,
award, or settlement obtained by the beneficiary or the director
against that third party. A provider may only recover upon the lien
if the provider has made a full reimbursement of any fees paid by the
department for those services.
(b) If either the beneficiary or the director brings an action or
claim against the third party, the party bringing the action shall,
within 30 days of bringing the action, give written notice to any
provider who is eligible to file a lien under subdivision (a) of the
action and of the name of the court or state or local agency in which
the action or claim is brought. Notice shall be given by personal
service or registered mail, and proof of service shall be filed in
the action or claim.
(c) The provider's claim for reimbursement for fees for services
rendered to the beneficiary shall be limited to the amount of the
fees less 25 percent, which represents the provider's reasonable
share of attorneys' fees for prosecution of the action and of the
cost of litigation expense.
(d) No claim authorized by this section shall be permitted to the
extent that the claim would reduce the director's right to recover
pursuant to Section 14124.78.
14124.792. If any provision of this article, or the application of
any provision of this article to any person, firm, corporation, or
other entity or to any circumstance or situation, shall be held
invalid, the remaining provisions of this article shall not be
affected thereby, and shall be given effect.
14124.795. It is the intent of the Legislature to comply with
federal law requiring that when a beneficiary has other available
health coverage or insurance, the Medi-Cal program shall be the payer
of last resort. Notwithstanding any other provision of law, any
carrier described in Section 14124.70, including automobile,
casualty, property, and malpractice insurers, shall enter into an
agreement with the department to permit and assist the matching of
the department's Medi-Cal eligibility file against the carrier's
claim files, utilizing, if necessary, social security numbers as
common identifiers for the purpose of determining whether Medi-Cal
benefits were provided to a beneficiary because of an injury for
which another person is liable, or for which a carrier is liable in
accordance with the provisions of any policy of insurance. The
carrier shall maintain a centralized file of claimants' names,
mailing addresses, and social security numbers or dates of birth.
This information shall be made available to the department upon the
department's reasonable request. The agreement described in this
section shall include financial arrangements for reimbursing carriers
for necessary costs incurred in furnishing requested information.
14124.80. The Legislature finds and declares that:
(a) Many instances of potential third-party liability,
particularly workers' compensation claims, are not discovered by the
department. Similarly, the Legislature finds that there are private
nongovernmental sources of potential claim information which is
unique to these private sources and not otherwise readily available
to the department. This private information is unique in that,
although the information may be shared between private claimants,
including potential private lienors, the department is not privy to
it and includes past adjudicated claims, expired or expiring health
policy claims, long-term care and settlement situations where
Medi-Cal is not identified in any application or filing for benefits.
Additionally, there are applications and other filings made without
any identification of potential Medi-Cal rights which become known to
private sources because of this information sharing system. Further,
there are other miscellaneous claims that have not been and will not
be discovered in the ordinary course of administration by the
department.
(b) There is a backlog of potential claims or liens which could
result in the recovery of substantial amounts if private sources of
information were available to the state.
(c) A cost-effective manner of recovering these potentially large
amounts is through the contracting by the state, on a pilot program
basis, with a private organization which possesses the expertise and
resources required to rapidly discover and recover the lienable
amounts owing by third parties for health care services provided by
the Medi-Cal program, and which will receive compensation on a
contingency fee arrangement, thereby supplementing the ongoing
functions of the state in recovering lienable amounts, reducing the
cost to the state of the recovery effort, and maximizing the amounts
recovered for the Medi-Cal program.
(d) Attorneys or the beneficiary, his guardian, personal
representative, estate or survivors of any of them who are currently
mandated under Section 14124.79 to report Medi-Cal involvement are
excluded from any further remuneration benefits under this section.
14124.81. The State Department of Health Services shall administer
the provisions of Sections 14124.82 to 14124.88, inclusive. The
department shall establish a pilot project for the discovery and
recovery of amounts owing by third parties for health care services
provided by the Medi-Cal program.
14124.82. (a) The department shall enter, by October 1, 1981, into
at least two at-risk performance type contracts with private
organizations that have access to information on cases with potential
for the recovery of amounts owing for services rendered under the
Medi-Cal program, and that have access to a substantial backlog
period of information on past due Medi-Cal claims, as well as current
and future potential claims. At least one contract shall cover
northern California claims, and at least one contract shall cover
southern California claims. Any contractor, otherwise qualified under
this section, may separately contract in each geographical area.
(b) Priority, by the terms of the contract or contracts, shall be
given to the identification and recovery of claims nearing the
statute of limitations, prior adjudicated claims, and prior existing
injury claims. However, all claims which are older, in whole or part,
than 12 months, at the time of discovery and notification by the
contractor to the department, shall be subject to contractual lien
recovery unless departmental personnel have previously identified
these claims and have filed appropriate liens, notices, or other
payment demands. A claim arises and the 12-month period begins when
the department or its fiscal agent has first made payment for medical
services related to the personal or workers' compensation action on
behalf of a given recipient. The department may waive any time
requirement, if it concludes that it will not otherwise discover the
claim and be able to effect recovery.
14124.83. The agreement shall include, but is not limited to, the
following provisions:
(a) The contractor shall discover and recover amounts owing by
third parties which may be subject to a claim for reimbursement.
(b) Payment to the contractor shall be based upon a no cost
percentage of recovery formula, which shall not exceed 25 percent of
the gross recovery upon the claim. It is the intent of the
Legislature that "no cost" include all considerations for court
costs, legal fees, and the universe of the case processing activity,
not including, however, departmental processing.
(c) The contractor shall report periodically to the department
concerning its progress in the discovery of cases and the recovery of
amounts subject to claim, and shall provide such other information
as the department may require to adequately monitor the progress of
the contractor. Reports and other information shall be required only
at one-month intervals.
14124.84. The department shall provide the contractor with such
information as is reasonably necessary for the contractor to perform
its obligations under the contract, including accounting data and
other information the contractor may request.
14124.85. The contractor, for the duration of the contract period,
shall have the powers of the Director of the State Department of
Health Services as set forth in this article, except for the power to
waive a claim under paragraph (2) of subdivision (b) of Section
14124.71. The contract shall specify the particular means and
documentation of the delegation of powers under paragraph (1) of
subdivision (b) of Section 14124.71. The contractor shall be subject
to the provisions of Section 14100.2 except that those provisions
shall not inhibit performance of the contract.
14124.86. The pilot project contract entered into by the department
pursuant to Section 14124.82 shall not exceed a term of three years
from the date of its execution. The contractor shall retain its
rights and duties under the contract with respect to any claims or
liens processed in whole or in part prior to the termination date of
the agreement.
14124.88. (a) Subsequent to the expiration of the pilot project
contract, the department, in its reasonable discretion, may execute a
separate, additional agreement for the discovery and recovery of
amounts which may be subject to claim pursuant to this article,
subject to Sections 14124.81 to 14124.87, inclusive.
(b) The department, if it receives a competitive qualified offer
of such services within the criteria set forth in Sections 14124.80
through 14124.87, shall separately contract for discovery and
recovery of workers' compensation claims with one contract to cover
areas of northern California and one to cover areas of southern
California.
(c) (1) Priority and inclusion of claims shall be as set forth in
subdivision (b) of Section 14124.82 and additionally shall include
any matter on file with the Workers' Compensation Appeals Board for a
period of more than 12 months unless the department has previously
identified these claims and has filed the appropriate lien or liens.
(2) The contract may include, or may be subsequently amended to
include, any or all previously identified claims and any other
potential lien claims, identified or not, if the department
determines that it will not otherwise be able to effectively process
recovery. This paragraph shall cease to be operative on January 1,
1995.
(d) There shall be no cost to the contractor for claim detail
reports provided by the fiscal intermediary. In all cases of workers'
compensation appeals, payment shall be made directly to the state
and a contractor shall not handle or have access to any moneys owing
the state. In these cases a bond required by the state for collection
agencies shall be sufficient. Contractor's files shall be subject to
audit, pursuant to the contract, but shall remain the property of
the contractor. At the request of the department, the contractor
shall provide copies of any claims related to a particular recovery.
(e) The contract shall provide that the contractor, with the
permission of the Attorney General, may appeal decisions of the
Workers' Compensation Appeals Board.
14124.89. (a) Every health insurer, self-insured plan, group health
plan, as defined in Section 607(1) of the Employee Retirement Income
Security Act of 1974, service benefit plan, managed care
organization, including health care service plans as defined in
subdivision (f) of Section 1345 of the Health and Safety Code,
licensed pursuant to the Knox-Keene Health Care Service Plan Act of
1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the
Health and Safety Code), pharmacy benefit manager, or other party
that is, by statute, contract, or agreement, legally responsible for
payment of a claim for a health care item or service shall, upon
request of the department for any records, or any information
contained in records pertaining to an individual or group health
insurance policy or plan issued by such insurer or plan against, or
pertaining to the medical or dental benefits paid by or claims made
against such insurer or plans under a policy or plan, make the
requested records or information available upon a certification by
the department that the individual is an applicant for or recipient
of services under this chapter or is a person who is legally
responsible for such an applicant or recipient.
(b) The department shall enter into a cooperative agreement
setting forth mutually agreeable procedures for requesting and
furnishing appropriate information, not inconsistent with any law
pertaining to the confidentiality and privacy of medical records,
which procedure shall include such financial arrangements as may be
necessary to reimburse insurers or plans for necessary costs incurred
in furnishing requested information, and the time and manner such
procedures are to become effective. Reimbursement to insurers or
plans complying with the provisions of this section shall be at the
same rate of reimbursement used to reimburse the Department of Motor
Vehicles for providing information to insurance carriers.
(c) The information required to be made available pursuant to this
section shall be limited to information necessary to determine
whether health benefits have been or should have been claimed and
paid pursuant to a health insurance policy or plan with respect to
items of medical care and services received by a particular
individual for which Medi-Cal coverage would otherwise be available.
(d) Not later than the date upon which the procedures agreed to
pursuant to subdivision (b) become effective, the director shall
establish guidelines to assure that information relating to an
individual certified to be an applicant for or recipient of medical
assistance, furnished to any insurer or plan pursuant to this
section, is used only for the purpose of identifying the records or
information requested in such manner so as not to violate the
confidentiality of an applicant or recipient.
(e) The department shall implement the provisions of this section
by January 1, 1983.
14124.90. It is the intent of the Legislature to comply with
federal law requiring that when a beneficiary has third-party health
coverage or insurance, the State Department of Health Services shall
be the payer of last resort. In order to assess overlapping or
duplicate health coverage, every health insurer, self-insured plan,
group health plan, as defined in Section 607(1) of the Employee
Retirement Income Security Act of 1974, service benefit plan, managed
care organization, including health care service plans as defined in
subdivision (f) of Section 1345 of the Health and Safety Code,
licensed pursuant to the Knox-Keene Health Care Service Plan Act of
1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the
Health and Safety Code), pharmacy benefit manager, or other party
that is, by statute, contract, or agreement, legally responsible for
payment of a claim for a health care item or service shall maintain a
centralized file of the subscribers', policyholders', or enrollees'
names, mailing addresses, and social security numbers or date of
birth, and where available, for all other covered persons, the names
and social security numbers or date of birth. This information shall
be made available to the State Department of Health Services upon
reasonable request. Notwithstanding Section 20134 of the Government
Code, the Board of Administration of the California Public Employees'
Retirement System and affiliated systems or contract agencies shall
permit data matches with the state department to identify Medi-Cal
beneficiaries with third-party health coverage or insurance. A
recipient's Medi-Cal identification card shall, where information is
available, contain information advising providers of health care
services of any third-party health coverage for the recipient.
Providers shall seek reimbursement from available third-party health
coverage before billing the Medi-Cal program.
14124.91. The State Department of Health Services shall, whenever
it is cost-effective, pay the premium for third-party health coverage
for beneficiaries under this chapter. The State Department of Health
Services shall, when a beneficiary's third-party health coverage
would lapse due to loss of employment or change in health status,
lack of sufficient income or financial resources, or any other
reason, continue the health coverage by paying the costs of
continuation of group coverage pursuant to federal law or converting
from a group to an individual plan, whenever it is cost-effective.
Notwithstanding any other provision of a contract or of law, the time
period for the department to exercise either of these options shall
be 60 days from the date of lapse of the policy.
14124.92. (a) The department may pay administrative expenses and
make incentive payments to any county, state, or federal agency, or a
contracting agent of the department for identifying and reporting
third-party health care coverage held or offered to beneficiaries
under this chapter.
(b) Unless the third-party health care coverage identified is
excluded under subdivision (d) from the incentive payment plan, an
agency or contractor may be entitled to an incentive payment if the
agency or contractor does all of the following:
(1) Identifies a case of which the department was not previously
aware.
(2) Provides to the department adequate and necessary information
relevant to the third-party health care coverage in order to make a
claim for benefits or reimbursement for services rendered that would
otherwise be paid by Medi-Cal.
(3) Reports to the department the identified third-party health
care coverage within 30 days of the date of discovery on a form
approved by the department.
(c) In no event shall any one incentive for each case identified
exceed one month of savings received by the department for benefits
paid by the third-party health care coverage.
(d) Third-party health care coverage that does not qualify for the
incentive payment plan under this section shall be identified by the
department based on policy limitations and cost-effectiveness. The
types of coverage that do not qualify under this section include
those that to which any of the following apply:
(1) Not specifically intended to provide third-party health care
coverage, such as coverage that provides life or car insurance
benefits, periodic benefits for disability or hospitalization, or
income protection.
(2) Coverage is limited to a specific diagnosis, unless the
beneficiary has been diagnosed with a condition or disease specified
in the coverage.
(3) Coverage is limited to a specific circumstance, such as
accidental injury or dismemberment.
(4) Coverage is limited to one specific category of service.
(e) For the purposes of this section, "third-party health care
coverage" means health care service plans, benefits, insurance
policies, and funds, including those described in Section 14124.90.
14124.93. (a) The Department of Child Support Services shall
provide payments to the local child support agency of fifty dollars
($50) per case for obtaining third-party health coverage or insurance
of beneficiaries, to the extent that funds are appropriated in the
annual Budget Act.
(b) A county shall be eligible for a payment if the county obtains
third-party health coverage or insurance for applicants or
recipients of Title IV-D services not previously covered, or for whom
coverage has lapsed, and the county provides all required
information on a form approved by both the Department of Child
Support Services and the State Department of Health Care Services.
(c) Payments to the local child support agency under this section
shall be suspended for the 2003-04, 2004-05, 2005-06, 2006-07,
2007-08, 2008-09, 2009-10, 2010-11, and 2011-12 fiscal years.
14124.94. (a) When the rights of a Medi-Cal beneficiary to health
care benefits from an insurer have been assigned to the department,
an insurer shall not impose any requirement on the department that is
different from any requirement applicable to an agent or any
assignee of the covered beneficiary.
(b) The department, in the administration of the Medi-Cal program,
may garnish the wages, salary, or other employment income of, and
withhold amounts from state tax refunds from, any person to whom both
of the following apply:
(1) The person is required by a court or administrative order to
provide coverage of the costs of health services to a child who is
eligible for medical assistance under the Medi-Cal program.
(2) The person has received payment from a third party for the
costs of the health services for the child, but he or she has not
used the payments to reimburse, as appropriate, either the other
parent or the person having custody of the child, or the provider of
the health services, to the extent necessary to reimburse the
department for expenditures for those costs under the Medi-Cal
program. All claims for current or past due child support shall take
priority over claims made by the department for the costs of Medi-Cal
services.
(c) For purposes of this section, "insurer" includes every health
insurer, self-insured plan, group health plan, as defined in Section
607(1) of the Employee Retirement Income Security Act of 1974,
service benefit plan, managed care organization, including health
care service plans as defined in subdivision (f) of Section 1345 of
the Health and Safety Code, licensed pursuant to the Knox-Keene
Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with
Section 1340) of Division 2 of the Health and Safety Code), pharmacy
benefit manager, or other party that is, by statute, contract, or
agreement, legally responsible for payment of a claim for a health
care item or service.
WELFARE AND INSTITUTIONS CODE
SECTION 14124.70-14124.94
14124.70. As used in this article:
(a) "Carrier" includes any insurer as defined in Section 23 of the
Insurance Code, including any private company, corporation, mutual
association, trust fund, reciprocal or interinsurance exchange
authorized under the laws of this state to insure persons against
liability or injuries caused to another, and also any insurer
providing benefits under a policy of bodily injury liability
insurance covering liability arising out of the ownership,
maintenance or use of a motor vehicle which provides uninsured
motorist endorsement or coverage, pursuant to Section 11580.2 of the
Insurance Code.
(b) "Beneficiary" means any person who has received benefits or
will be provided benefits under this chapter because of an injury for
which another person or party may be liable. It includes such
beneficiary's guardian, conservator or other personal representative,
his estate or survivors.
(c) "Reasonable value of benefits" means both of the following:
(1) Except in a case in which services were provided to a
beneficiary under a managed care arrangement or contract, "reasonable
value of benefits" means the Medi-Cal rate of payment, for the type
of services rendered, under the schedule of maximum allowances
authorized by Section 14106 or, the Medi-Cal rate of payment, for the
type of services rendered, under regulations adopted pursuant to
this chapter, including but not limited, to Section 14105.
(2) If services were provided to a beneficiary under a managed
care arrangement or contract, "reasonable value of benefits" means
the rate of payment to the provider by the plan for the services
rendered to the beneficiary, except in cases where the plan pays the
provider on a capitated or risk sharing basis, in which case it means
the value of the services rendered to the beneficiary calculated by
the plan as the usual customary and reasonable charge made to the
general public by the provider for similar services.
(d) "Lien" means the director's claim for recovery, from a
beneficiary's tort action or claim, of the reasonable value of
benefits provided on behalf of the beneficiary.
14124.71. (a) When benefits are provided or will be provided to a
beneficiary under this chapter because of an injury for which another
person is liable, or for which a carrier is liable in accordance
with the provisions of any policy of insurance issued pursuant to
Insurance Code Section 11580.2, the director shall have a right to
recover from such person or carrier the reasonable value of benefits
so provided. The Attorney General, or counsel for the fiscal
intermediary under the Medi-Cal program with the permission of the
Attorney General, or a contractor pursuant to Section 14124.80, or a
county through its civil legal adviser, may, to enforce such right,
institute and prosecute legal proceedings against the third person or
carrier who may be liable for the injury in an appropriate court,
either in the name of the director or in the name of the injured
person, his guardian, conservator, personal representative, estate,
or survivors.
(b) The director may:
(1) Compromise, or settle and release any such claim, or
(2) Waive any such claim, in whole or in part, for the convenience
of the director, or if the director determines that collection would
result in undue hardship upon the person who suffered the injury, or
in a wrongful death action upon the heirs of the deceased.
(c) No action taken in behalf of the director pursuant to this
section or any judgment rendered in such action shall be a bar to any
action upon the claim or cause of action of the beneficiary, his
guardian, conservator, personal representative, estate, dependents,
or survivors against the third person who may be liable for the
injury, or shall operate to deny to the beneficiary the recovery for
that portion of any damages not covered hereunder.
(d) The cost of a service provided to an eligible developmentally
disabled Medi-Cal beneficiary under Section 14132.44 may be recovered
by the director from a liable third person or an insurance carrier.
14124.72. (a) Where an action is brought by the director pursuant
to Section 14124.71, it shall be commenced within the period
prescribed in Section 338 of the Code of Civil Procedure.
(b) The death of the beneficiary does not abate any right of
action established by Section 14124.71.
(c) When an action or claim is brought by persons entitled to
bring such actions or assert such claims against a third party who
may be liable for causing the death of a beneficiary, any settlement,
judgment or award obtained is subject to the director's right to
recover from that party the reasonable value of the benefits provided
to the beneficiary under the Medi-Cal program, as provided in
subdivision (d).
(d) Where the action or claim is brought by the beneficiary alone
and the beneficiary incurs a personal liability to pay attorney's
fees and costs of litigation, the director's claim for reimbursement
of the benefits provided to the beneficiary shall be limited to the
reasonable value of benefits provided to the beneficiary under the
Medi-Cal program less 25 percent which represents the director's
reasonable share of attorney's fees paid by the beneficiary and that
portion of the cost of litigation expenses determined by multiplying
by the ratio of the full amount of the reasonable value of benefits
so provided to the full amount of the judgment, award, or settlement.
14124.73. (a) If either the beneficiary or the director brings an
action or claim against such third person or carrier the beneficiary
or the director shall within 30 days of filing the action give to the
other written notice by personal service or registered mail of the
action or claim, and of the name of the court or state or local
agency in which the action or claim is brought. Proof of such notice
shall be filed in such action or claim. If an action or claim is
brought by either the director or the beneficiary, the other may, at
any time before trial on the facts, become a party to, or shall
consolidate his action or claim with the other if brought
independently.
(b) If an action or claim is brought by the director pursuant to
subdivision (a) of Section 14124.71, written notice to the
beneficiary, guardian, conservator, personal representative, estate
or survivor given pursuant to this section shall advise him of his
right to intervene in the proceeding, his right to obtain a private
attorney of his choice, and the director's right to recover the
reasonable value of the benefits provided.
14124.74. In the event of judgment or award in a suit or claim
against a third party or carrier:
(a) If the action or claim is prosecuted by the beneficiary alone,
the court or agency shall first order paid from any judgment or
award the reasonable litigation expenses incurred in preparation and
prosecution of the action or claim, together with reasonable attorney'
s fees, when an attorney has been retained. After payment of these
expenses and attorney's fees the court or agency shall, on the
application of the director, allow as a first lien against the amount
of the settlement, judgment, or award the reasonable value of
additional benefits provided to the beneficiary under the Medi-Cal
program, as provided in subdivision (d) of Section 14124.72, and as a
second lien, the amount of any claims, pursuant to Section 14019.3,
owed to a provider, as provided in Section 14124.791.
(b) If the action or claim is prosecuted both by the beneficiary
and the director, the court or agency shall first order paid from any
judgment or award, the reasonable litigation expenses incurred in
preparation and prosecution of the action or claim, together with
reasonable attorney's fees based solely on the services rendered for
the benefit of the beneficiary. After payment of these expenses and
attorney's fees, the court or agency shall first apply out of the
balance of the judgment or award an amount sufficient to reimburse
the director the full amount of the reasonable value of benefits
provided on behalf of the beneficiary under the Medi-Cal program, and
then an amount sufficient to reimburse a provider who has filed a
lien for any claims for services rendered to the beneficiary, as
provided under Section 14124.791.
14124.75. The court or agency shall, upon further application at
any time before the judgment or award is satisfied, allow as a
further lien the reasonable value of additional benefits provided
arising out of the same cause of action or claim provided on behalf
of the beneficiary under the Medi-Cal Program, where such benefits
were provided or became payable subsequent to the original order.
14124.76. (a) No settlement, judgment, or award in any action or
claim by a beneficiary to recover damages for injuries, where the
director has an interest, shall be deemed final or satisfied without
first giving the director notice and a reasonable opportunity to
perfect and to satisfy the director's lien. Recovery of the director'
s lien from an injured beneficiary's action or claim is limited to
that portion of a settlement, judgment, or award that represents
payment for medical expenses, or medical care, provided on behalf of
the beneficiary. All reasonable efforts shall be made to obtain the
director's advance agreement to a determination as to what portion of
a settlement, judgment, or award that represents payment for medical
expenses, or medical care, provided of behalf on the beneficiary.
Absent the director's advance agreement as to what portion of a
settlement, judgment, or award represents payment for medical
expenses, or medical care, provided on behalf of the beneficiary, the
matter shall be submitted to a court for decision. Either the
director or the beneficiary may seek resolution of the dispute by
filing a motion, which shall be subject to regular law and motion
procedures. In determining what portion of a settlement, judgment, or
award represents payment for medical expenses, or medical care,
provided on behalf of the beneficiary and as to what the appropriate
reimbursement amount to the director should be, the court shall be
guided by the United States Supreme Court decision in Arkansas
Department of Health and Human Services v. Ahlborn (2006) 547 U.S.
268 and other relevant statutory and case law.
(b) If the beneficiary has filed a third-party action or claim,
the court where the action or claim was filed shall have jurisdiction
over a dispute between the director and the beneficiary regarding
the amount of a lien asserted pursuant to this section that is based
upon an allocation of damages contained in a settlement or compromise
of the third-party action or claim. If no third-party action or
claim has been filed, any superior court in California where venue
would have been proper had a claim or action been filed shall have
jurisdiction over the motion. The motion may be filed as a special
motion and treated as an ordinary law and motion proceeding and
subject to regular motion fees. The reimbursement determination
motion shall be treated as a special proceeding of a civil nature
pursuant to Part 3 (commencing with Section 1063) of the Code of
Civil Procedure. When no action is pending, the person making the
motion shall be required to pay a first appearance fee. When an
action is pending, the person making the motion shall pay a regular
law and motion fee. Notwithstanding Section 1064 of the Code of Civil
Procedure, either the beneficiary or the director may appeal the
final findings, decision, or order.
(c) The court shall issue its findings, decision, or order, which
shall be considered the final determination of the parties' rights
and obligations with respect to the director's lien, unless the
settlement is contingent on an acceptable allocation of the
settlement proceeds, in which case, the court's findings, decision,
or order shall be considered a tentative determination. If the
beneficiary does not serve notice of a rejection of the tentative
determination, which shall be based solely upon a rejection of the
contingent settlement, within 30 days of the notice of entry of the
court's tentative determination, subject to further consideration by
the court pursuant to subdivision (d), the tentative determination
shall become final. Notwithstanding Section 1064 of the Code of Civil
Procedure, either the beneficiary or the director may appeal the
final findings, decision, or order.
(d) If the beneficiary does not accept the tentative
determination, which shall be based solely upon a rejection of the
contingent settlement, any party may subsequently seek further
consideration of the court's findings upon application to modify the
prior findings, decision, or order based on new or different facts or
circumstances. The application shall include an affidavit showing
what application was made before, when, and to what judge, what order
or decision was made, and what new or different facts or
circumstances, including a different settlement, are claimed to
exist. Upon further consideration, the court may modify the
allocation in the interest of fairness and for good cause.
14124.77. When the director has perfected a lien upon a judgment or
award in favor of a beneficiary against any third party for an
injury for which the beneficiary has received benefits under the
Medi-Cal Program, the director shall be entitled to a writ of
execution as lien claimant to enforce payment of said lien against
such third party with interest and other accruing costs as in the
case of other executions. In the event the amount of such judgment or
award so recovered has been paid to the beneficiary, the director
shall be entitled to a writ of execution against such beneficiary to
the extent of the director's lien, with interest and other accruing
costs as in the case of other executions.
14124.78. Notwithstanding any other provision of law, in no event
shall the director recover more than the beneficiary recovers after
deducting, from the settlement judgment, or award, attorney's fees
and litigation costs paid for by the beneficiary. If the director's
recovery is determined under this section, the reductions in
subdivision (d) of Section 14124.72 shall not apply.
14124.785. The director's recovery is limited to the amount derived
from applying Section 14124.72, 14124.76, or 14124.78, whichever is
less.
14124.79. In the event that the beneficiary, his guardian,
conservator, personal representative, estate or survivors or any of
them brings an action against the third person who may be liable for
the injury, notice of institution of legal proceedings, notice of
settlement and all other notices required by this code shall be given
to the director in Sacramento except in cases where the director
specifies that notice shall be given to the Attorney General. All
such notices shall be given by insurance carriers, as described in
Section 14124.70, having liability for the beneficiary's claim, and
by the attorney retained to assert the beneficiary's claim, or by the
injured party beneficiary, his guardian, conservator, personal
representative, estate or survivors, if no attorney is retained.
14124.791. (a) Subject to the director's prior right of recovery, a
provider who has rendered services to a beneficiary because of an
injury for which a third party is liable and who has received payment
under the Medi-Cal program shall be entitled to file a lien for all
fees for services provided to the beneficiary against any judgment,
award, or settlement obtained by the beneficiary or the director
against that third party. A provider may only recover upon the lien
if the provider has made a full reimbursement of any fees paid by the
department for those services.
(b) If either the beneficiary or the director brings an action or
claim against the third party, the party bringing the action shall,
within 30 days of bringing the action, give written notice to any
provider who is eligible to file a lien under subdivision (a) of the
action and of the name of the court or state or local agency in which
the action or claim is brought. Notice shall be given by personal
service or registered mail, and proof of service shall be filed in
the action or claim.
(c) The provider's claim for reimbursement for fees for services
rendered to the beneficiary shall be limited to the amount of the
fees less 25 percent, which represents the provider's reasonable
share of attorneys' fees for prosecution of the action and of the
cost of litigation expense.
(d) No claim authorized by this section shall be permitted to the
extent that the claim would reduce the director's right to recover
pursuant to Section 14124.78.
14124.792. If any provision of this article, or the application of
any provision of this article to any person, firm, corporation, or
other entity or to any circumstance or situation, shall be held
invalid, the remaining provisions of this article shall not be
affected thereby, and shall be given effect.
14124.795. It is the intent of the Legislature to comply with
federal law requiring that when a beneficiary has other available
health coverage or insurance, the Medi-Cal program shall be the payer
of last resort. Notwithstanding any other provision of law, any
carrier described in Section 14124.70, including automobile,
casualty, property, and malpractice insurers, shall enter into an
agreement with the department to permit and assist the matching of
the department's Medi-Cal eligibility file against the carrier's
claim files, utilizing, if necessary, social security numbers as
common identifiers for the purpose of determining whether Medi-Cal
benefits were provided to a beneficiary because of an injury for
which another person is liable, or for which a carrier is liable in
accordance with the provisions of any policy of insurance. The
carrier shall maintain a centralized file of claimants' names,
mailing addresses, and social security numbers or dates of birth.
This information shall be made available to the department upon the
department's reasonable request. The agreement described in this
section shall include financial arrangements for reimbursing carriers
for necessary costs incurred in furnishing requested information.
14124.80. The Legislature finds and declares that:
(a) Many instances of potential third-party liability,
particularly workers' compensation claims, are not discovered by the
department. Similarly, the Legislature finds that there are private
nongovernmental sources of potential claim information which is
unique to these private sources and not otherwise readily available
to the department. This private information is unique in that,
although the information may be shared between private claimants,
including potential private lienors, the department is not privy to
it and includes past adjudicated claims, expired or expiring health
policy claims, long-term care and settlement situations where
Medi-Cal is not identified in any application or filing for benefits.
Additionally, there are applications and other filings made without
any identification of potential Medi-Cal rights which become known to
private sources because of this information sharing system. Further,
there are other miscellaneous claims that have not been and will not
be discovered in the ordinary course of administration by the
department.
(b) There is a backlog of potential claims or liens which could
result in the recovery of substantial amounts if private sources of
information were available to the state.
(c) A cost-effective manner of recovering these potentially large
amounts is through the contracting by the state, on a pilot program
basis, with a private organization which possesses the expertise and
resources required to rapidly discover and recover the lienable
amounts owing by third parties for health care services provided by
the Medi-Cal program, and which will receive compensation on a
contingency fee arrangement, thereby supplementing the ongoing
functions of the state in recovering lienable amounts, reducing the
cost to the state of the recovery effort, and maximizing the amounts
recovered for the Medi-Cal program.
(d) Attorneys or the beneficiary, his guardian, personal
representative, estate or survivors of any of them who are currently
mandated under Section 14124.79 to report Medi-Cal involvement are
excluded from any further remuneration benefits under this section.
14124.81. The State Department of Health Services shall administer
the provisions of Sections 14124.82 to 14124.88, inclusive. The
department shall establish a pilot project for the discovery and
recovery of amounts owing by third parties for health care services
provided by the Medi-Cal program.
14124.82. (a) The department shall enter, by October 1, 1981, into
at least two at-risk performance type contracts with private
organizations that have access to information on cases with potential
for the recovery of amounts owing for services rendered under the
Medi-Cal program, and that have access to a substantial backlog
period of information on past due Medi-Cal claims, as well as current
and future potential claims. At least one contract shall cover
northern California claims, and at least one contract shall cover
southern California claims. Any contractor, otherwise qualified under
this section, may separately contract in each geographical area.
(b) Priority, by the terms of the contract or contracts, shall be
given to the identification and recovery of claims nearing the
statute of limitations, prior adjudicated claims, and prior existing
injury claims. However, all claims which are older, in whole or part,
than 12 months, at the time of discovery and notification by the
contractor to the department, shall be subject to contractual lien
recovery unless departmental personnel have previously identified
these claims and have filed appropriate liens, notices, or other
payment demands. A claim arises and the 12-month period begins when
the department or its fiscal agent has first made payment for medical
services related to the personal or workers' compensation action on
behalf of a given recipient. The department may waive any time
requirement, if it concludes that it will not otherwise discover the
claim and be able to effect recovery.
14124.83. The agreement shall include, but is not limited to, the
following provisions:
(a) The contractor shall discover and recover amounts owing by
third parties which may be subject to a claim for reimbursement.
(b) Payment to the contractor shall be based upon a no cost
percentage of recovery formula, which shall not exceed 25 percent of
the gross recovery upon the claim. It is the intent of the
Legislature that "no cost" include all considerations for court
costs, legal fees, and the universe of the case processing activity,
not including, however, departmental processing.
(c) The contractor shall report periodically to the department
concerning its progress in the discovery of cases and the recovery of
amounts subject to claim, and shall provide such other information
as the department may require to adequately monitor the progress of
the contractor. Reports and other information shall be required only
at one-month intervals.
14124.84. The department shall provide the contractor with such
information as is reasonably necessary for the contractor to perform
its obligations under the contract, including accounting data and
other information the contractor may request.
14124.85. The contractor, for the duration of the contract period,
shall have the powers of the Director of the State Department of
Health Services as set forth in this article, except for the power to
waive a claim under paragraph (2) of subdivision (b) of Section
14124.71. The contract shall specify the particular means and
documentation of the delegation of powers under paragraph (1) of
subdivision (b) of Section 14124.71. The contractor shall be subject
to the provisions of Section 14100.2 except that those provisions
shall not inhibit performance of the contract.
14124.86. The pilot project contract entered into by the department
pursuant to Section 14124.82 shall not exceed a term of three years
from the date of its execution. The contractor shall retain its
rights and duties under the contract with respect to any claims or
liens processed in whole or in part prior to the termination date of
the agreement.
14124.88. (a) Subsequent to the expiration of the pilot project
contract, the department, in its reasonable discretion, may execute a
separate, additional agreement for the discovery and recovery of
amounts which may be subject to claim pursuant to this article,
subject to Sections 14124.81 to 14124.87, inclusive.
(b) The department, if it receives a competitive qualified offer
of such services within the criteria set forth in Sections 14124.80
through 14124.87, shall separately contract for discovery and
recovery of workers' compensation claims with one contract to cover
areas of northern California and one to cover areas of southern
California.
(c) (1) Priority and inclusion of claims shall be as set forth in
subdivision (b) of Section 14124.82 and additionally shall include
any matter on file with the Workers' Compensation Appeals Board for a
period of more than 12 months unless the department has previously
identified these claims and has filed the appropriate lien or liens.
(2) The contract may include, or may be subsequently amended to
include, any or all previously identified claims and any other
potential lien claims, identified or not, if the department
determines that it will not otherwise be able to effectively process
recovery. This paragraph shall cease to be operative on January 1,
1995.
(d) There shall be no cost to the contractor for claim detail
reports provided by the fiscal intermediary. In all cases of workers'
compensation appeals, payment shall be made directly to the state
and a contractor shall not handle or have access to any moneys owing
the state. In these cases a bond required by the state for collection
agencies shall be sufficient. Contractor's files shall be subject to
audit, pursuant to the contract, but shall remain the property of
the contractor. At the request of the department, the contractor
shall provide copies of any claims related to a particular recovery.
(e) The contract shall provide that the contractor, with the
permission of the Attorney General, may appeal decisions of the
Workers' Compensation Appeals Board.
14124.89. (a) Every health insurer, self-insured plan, group health
plan, as defined in Section 607(1) of the Employee Retirement Income
Security Act of 1974, service benefit plan, managed care
organization, including health care service plans as defined in
subdivision (f) of Section 1345 of the Health and Safety Code,
licensed pursuant to the Knox-Keene Health Care Service Plan Act of
1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the
Health and Safety Code), pharmacy benefit manager, or other party
that is, by statute, contract, or agreement, legally responsible for
payment of a claim for a health care item or service shall, upon
request of the department for any records, or any information
contained in records pertaining to an individual or group health
insurance policy or plan issued by such insurer or plan against, or
pertaining to the medical or dental benefits paid by or claims made
against such insurer or plans under a policy or plan, make the
requested records or information available upon a certification by
the department that the individual is an applicant for or recipient
of services under this chapter or is a person who is legally
responsible for such an applicant or recipient.
(b) The department shall enter into a cooperative agreement
setting forth mutually agreeable procedures for requesting and
furnishing appropriate information, not inconsistent with any law
pertaining to the confidentiality and privacy of medical records,
which procedure shall include such financial arrangements as may be
necessary to reimburse insurers or plans for necessary costs incurred
in furnishing requested information, and the time and manner such
procedures are to become effective. Reimbursement to insurers or
plans complying with the provisions of this section shall be at the
same rate of reimbursement used to reimburse the Department of Motor
Vehicles for providing information to insurance carriers.
(c) The information required to be made available pursuant to this
section shall be limited to information necessary to determine
whether health benefits have been or should have been claimed and
paid pursuant to a health insurance policy or plan with respect to
items of medical care and services received by a particular
individual for which Medi-Cal coverage would otherwise be available.
(d) Not later than the date upon which the procedures agreed to
pursuant to subdivision (b) become effective, the director shall
establish guidelines to assure that information relating to an
individual certified to be an applicant for or recipient of medical
assistance, furnished to any insurer or plan pursuant to this
section, is used only for the purpose of identifying the records or
information requested in such manner so as not to violate the
confidentiality of an applicant or recipient.
(e) The department shall implement the provisions of this section
by January 1, 1983.
14124.90. It is the intent of the Legislature to comply with
federal law requiring that when a beneficiary has third-party health
coverage or insurance, the State Department of Health Services shall
be the payer of last resort. In order to assess overlapping or
duplicate health coverage, every health insurer, self-insured plan,
group health plan, as defined in Section 607(1) of the Employee
Retirement Income Security Act of 1974, service benefit plan, managed
care organization, including health care service plans as defined in
subdivision (f) of Section 1345 of the Health and Safety Code,
licensed pursuant to the Knox-Keene Health Care Service Plan Act of
1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the
Health and Safety Code), pharmacy benefit manager, or other party
that is, by statute, contract, or agreement, legally responsible for
payment of a claim for a health care item or service shall maintain a
centralized file of the subscribers', policyholders', or enrollees'
names, mailing addresses, and social security numbers or date of
birth, and where available, for all other covered persons, the names
and social security numbers or date of birth. This information shall
be made available to the State Department of Health Services upon
reasonable request. Notwithstanding Section 20134 of the Government
Code, the Board of Administration of the California Public Employees'
Retirement System and affiliated systems or contract agencies shall
permit data matches with the state department to identify Medi-Cal
beneficiaries with third-party health coverage or insurance. A
recipient's Medi-Cal identification card shall, where information is
available, contain information advising providers of health care
services of any third-party health coverage for the recipient.
Providers shall seek reimbursement from available third-party health
coverage before billing the Medi-Cal program.
14124.91. The State Department of Health Services shall, whenever
it is cost-effective, pay the premium for third-party health coverage
for beneficiaries under this chapter. The State Department of Health
Services shall, when a beneficiary's third-party health coverage
would lapse due to loss of employment or change in health status,
lack of sufficient income or financial resources, or any other
reason, continue the health coverage by paying the costs of
continuation of group coverage pursuant to federal law or converting
from a group to an individual plan, whenever it is cost-effective.
Notwithstanding any other provision of a contract or of law, the time
period for the department to exercise either of these options shall
be 60 days from the date of lapse of the policy.
14124.92. (a) The department may pay administrative expenses and
make incentive payments to any county, state, or federal agency, or a
contracting agent of the department for identifying and reporting
third-party health care coverage held or offered to beneficiaries
under this chapter.
(b) Unless the third-party health care coverage identified is
excluded under subdivision (d) from the incentive payment plan, an
agency or contractor may be entitled to an incentive payment if the
agency or contractor does all of the following:
(1) Identifies a case of which the department was not previously
aware.
(2) Provides to the department adequate and necessary information
relevant to the third-party health care coverage in order to make a
claim for benefits or reimbursement for services rendered that would
otherwise be paid by Medi-Cal.
(3) Reports to the department the identified third-party health
care coverage within 30 days of the date of discovery on a form
approved by the department.
(c) In no event shall any one incentive for each case identified
exceed one month of savings received by the department for benefits
paid by the third-party health care coverage.
(d) Third-party health care coverage that does not qualify for the
incentive payment plan under this section shall be identified by the
department based on policy limitations and cost-effectiveness. The
types of coverage that do not qualify under this section include
those that to which any of the following apply:
(1) Not specifically intended to provide third-party health care
coverage, such as coverage that provides life or car insurance
benefits, periodic benefits for disability or hospitalization, or
income protection.
(2) Coverage is limited to a specific diagnosis, unless the
beneficiary has been diagnosed with a condition or disease specified
in the coverage.
(3) Coverage is limited to a specific circumstance, such as
accidental injury or dismemberment.
(4) Coverage is limited to one specific category of service.
(e) For the purposes of this section, "third-party health care
coverage" means health care service plans, benefits, insurance
policies, and funds, including those described in Section 14124.90.
14124.93. (a) The Department of Child Support Services shall
provide payments to the local child support agency of fifty dollars
($50) per case for obtaining third-party health coverage or insurance
of beneficiaries, to the extent that funds are appropriated in the
annual Budget Act.
(b) A county shall be eligible for a payment if the county obtains
third-party health coverage or insurance for applicants or
recipients of Title IV-D services not previously covered, or for whom
coverage has lapsed, and the county provides all required
information on a form approved by both the Department of Child
Support Services and the State Department of Health Care Services.
(c) Payments to the local child support agency under this section
shall be suspended for the 2003-04, 2004-05, 2005-06, 2006-07,
2007-08, 2008-09, 2009-10, 2010-11, and 2011-12 fiscal years.
14124.94. (a) When the rights of a Medi-Cal beneficiary to health
care benefits from an insurer have been assigned to the department,
an insurer shall not impose any requirement on the department that is
different from any requirement applicable to an agent or any
assignee of the covered beneficiary.
(b) The department, in the administration of the Medi-Cal program,
may garnish the wages, salary, or other employment income of, and
withhold amounts from state tax refunds from, any person to whom both
of the following apply:
(1) The person is required by a court or administrative order to
provide coverage of the costs of health services to a child who is
eligible for medical assistance under the Medi-Cal program.
(2) The person has received payment from a third party for the
costs of the health services for the child, but he or she has not
used the payments to reimburse, as appropriate, either the other
parent or the person having custody of the child, or the provider of
the health services, to the extent necessary to reimburse the
department for expenditures for those costs under the Medi-Cal
program. All claims for current or past due child support shall take
priority over claims made by the department for the costs of Medi-Cal
services.
(c) For purposes of this section, "insurer" includes every health
insurer, self-insured plan, group health plan, as defined in Section
607(1) of the Employee Retirement Income Security Act of 1974,
service benefit plan, managed care organization, including health
care service plans as defined in subdivision (f) of Section 1345 of
the Health and Safety Code, licensed pursuant to the Knox-Keene
Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with
Section 1340) of Division 2 of the Health and Safety Code), pharmacy
benefit manager, or other party that is, by statute, contract, or
agreement, legally responsible for payment of a claim for a health
care item or service.
