Bill Text: MI HB5646 | 2009-2010 | 95th Legislature | Introduced

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Bill Title: Human services; medical services; certain notice requirements when filing a complaint or settling a claim without filing a complaint; clarify. Amends sec. 106 of 1939 PA 280 (MCL 400.106).

Spectrum: Partisan Bill (Democrat 6-0)

Status: (Introduced - Dead) 2009-12-08 - Printed Bill Filed 12/04/2009 [HB5646 Detail]

Download: Michigan-2009-HB5646-Introduced.html

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HOUSE BILL No. 5646

 

December 3, 2009, Introduced by Reps. Constan, Clemente, Polidori, Lahti, Gonzales and Spade and referred to the Committee on Government Operations.

 

     A bill to amend 1939 PA 280, entitled

 

"The social welfare act,"

 

by amending section 106 (MCL 400.106), as amended by 2006 PA 144.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 106. (1) A medically indigent individual is defined as:

 

     (a) An individual receiving family independence program

 

benefits or an individual receiving supplemental security income

 

under title XVI or state supplementation under title XVI subject to

 

limitations imposed by the director according to title XIX.

 

     (b) Except as provided in section 106a, an individual who

 

meets all of the following conditions:

 

     (i) The individual has applied in the manner the family

 

independence agency department prescribes.

 

     (ii) The individual's need for the type of medical assistance

 

available under this act for which the individual applied has been

 

professionally established and payment for it is not available

 

through the legal obligation of a public or private contractor to

 

pay or provide for the care without regard to the income or

 

resources of the patient. The state department is subrogated to any

 

right of recovery that a patient may have for the cost of

 

hospitalization, pharmaceutical services, physician services,

 

nursing services, and other medical services not to exceed the

 

amount of funds expended by the state department for the care and

 

treatment of the patient. The patient or other person acting in the

 

patient's behalf shall execute and deliver an assignment of claim

 

or other authorizations as necessary to secure the right of

 

recovery to the department. A payment may be withheld under this

 

act for medical assistance for an injury or disability for which

 

the individual is entitled to medical care or reimbursement for the

 

cost of medical care under sections 3101 to 3179 of the insurance

 

code of 1956, 1956 PA 218, MCL 500.3101 to 500.3179, or under

 

another policy of insurance providing medical or hospital benefits,

 

or both, for the individual unless the individual's entitlement to

 

that medical care or reimbursement is at issue. If a payment is

 

made, the state department, to enforce its subrogation right, may

 

do either of the following: (a) intervene or join in an action or

 

proceeding brought by the injured, diseased, or disabled

 

individual, the individual's guardian, personal representative,

 

estate, dependents, or survivors, against the third person who may

 

be liable for the injury, disease, or disability, or against

 

contractors, public or private, who may be liable to pay or provide

 

medical care and services rendered to an injured, diseased, or

 

disabled individual; (b) institute and prosecute a legal proceeding

 

against a third person who may be liable for the injury, disease,

 

or disability, or against contractors, public or private, who may

 

be liable to pay or provide medical care and services rendered to

 

an injured, diseased, or disabled individual, in state or federal

 

court, either alone or in conjunction with the injured, diseased,

 

or disabled individual, the individual's guardian, personal

 

representative, estate, dependents, or survivors. The state

 

department may institute the proceedings in its own name or in the

 

name of the injured, diseased, or disabled individual, the

 

individual's guardian, personal representative, estate, dependents,

 

or survivors. As provided in section 6023 of the revised judicature

 

act of 1961, 1961 PA 236, MCL 600.6023, the state department, in

 

enforcing its subrogation right, shall not satisfy a judgment

 

against the third person's property that is exempt from levy and

 

sale. The injured, diseased, or disabled individual may proceed in

 

his or her own name, collecting the costs without the necessity of

 

joining the state department or the state as a named party. The

 

injured, diseased, or disabled individual shall notify the state

 

department of the action or proceeding entered into upon

 

commencement of the action or proceeding. An action taken by the

 

state or the state department in connection with the right of

 

recovery afforded by this section does not deny the injured,

 

diseased, or disabled individual any part of the recovery beyond

 

the costs expended on the individual's behalf by the state

 

department. The costs of legal action initiated by the state shall

 

be paid by the state. A payment shall not be made under this act

 

for medical assistance for an injury, disease, or disability for

 

which the individual is entitled to medical care or the cost of

 

medical care under the worker's disability compensation act of

 

1969, 1969 PA 317, MCL 418.101 to 418.941; except that payment may

 

be made if an appropriate application for medical care or the cost

 

of the medical care has been made under the worker's disability

 

compensation act of 1969, 1969 PA 317, MCL 418.101 to 418.941,

 

entitlement has not been finally determined, and an arrangement

 

satisfactory to the state department has been made for

 

reimbursement if the claim under the worker's disability

 

compensation act of 1969, 1969 PA 317, MCL 418.101 to 418.941, is

 

finally sustained.

 

     (iii) The individual has an annual income that is below, or

 

subject to limitations imposed by the director and because of

 

medical expenses falls below, the protected basic maintenance

 

level. The protected basic maintenance level for 1-person and 2-

 

person families shall be at least 100% of the payment standards

 

generally used to determine eligibility in the family independence

 

program. For families of 3 or more persons, the protected basic

 

maintenance level shall be at least 100% of the payment standard

 

generally used to determine eligibility in the family independence

 

program. These levels shall recognize regional variations and shall

 

not exceed 133-1/3% of the payment standard generally used to

 

determine eligibility in the family independence program.

 

     (iv) The individual, if a family independence program related

 

individual and living alone, has liquid or marketable assets of not

 

more than $2,000.00 in value, or, if a 2-person family, the family

 

has liquid or marketable assets of not more than $3,000.00 in

 

value. The state department shall establish comparable liquid or

 

marketable asset amounts for larger family groups. Excluded in

 

making the determination of the value of liquid or marketable

 

assets are the values of: the homestead; clothing; household

 

effects; $1,000.00 of cash surrender value of life insurance,

 

except that if the insured's health of the insured makes

 

continuance of continuing the insurance desirable, the entire cash

 

surrender value of life insurance is excluded from consideration,

 

up to the maximum provided or allowed by federal regulations and in

 

accordance with state department rules; the fair market value of

 

tangible personal property used in earning income; an amount paid

 

as judgment or settlement for damages suffered as a result of

 

exposure to agent orange, as defined in section 5701 of the public

 

health code, 1978 PA 368, MCL 333.5701; and a space or plot

 

purchased for the purposes of burial for the person. For

 

individuals related to the title XVI program, the appropriate

 

resource levels and property exemptions specified in title XVI

 

shall be used.

 

     (v) The individual is not an inmate of a public institution

 

except as a patient in a medical institution.

 

     (vi) The individual meets the eligibility standards for

 

supplemental security income under title XVI or for state

 

supplementation under the act, subject to limitations imposed by

 

the director according to title XIX; or meets the eligibility

 

standards for family independence program benefits; or meets the

 

eligibility standards for optional eligibility groups under title

 

XIX, subject to limitations imposed by the director according to

 

title XIX.

 

     (2) As used in this act:

 

     (a) "Medicaid contracted health plan" means a managed care

 

organization with whom the state department contracts to provide or

 

arrange for the delivery of comprehensive health care services as

 

authorized under this act.

 

     (b) "Medical institution" means a state licensed or approved

 

hospital, nursing home, medical care facility, psychiatric

 

hospital, or other facility or identifiable unit of a listed

 

institution certified as meeting established standards for a

 

nursing home or hospital in accordance with the laws of this state.

 

     (c) "Title XVI" means title XVI of the social security act, 42

 

USC 1381 to 1382j and 1383 to 1383f.

 

     (3) An If an individual receiving medical assistance under

 

this act or his or her legal counsel shall notify the state

 

department when filing an action files a complaint in which the

 

state department may have a right to recover expenses paid under

 

this act, the individual, his or her representative, or his or her

 

legal counsel must notify the state department and serve a copy of

 

the complaint on the state department not later than 7 days after

 

the complaint has been filed with the court. If the individual is

 

enrolled in a medicaid contracted health plan, the individual, or

 

his or her representative, or his or her legal counsel shall must

 

provide notice to the medicaid contracted health plan in addition

 

to providing notice to the state department not later than 7 days

 

after the complaint has been filed with the court.

 

     (4) If a legal action in which the state department, a

 

medicaid contracted health plan, or both has a right to recover

 

expenses paid under this act is filed and settled after November

 

29, 2004 without notice to the state department or the medicaid

 

contracted health plan, the state department or the medicaid

 

contracted health plan may file a legal action against the

 

individual or his or her legal counsel, or both, to recover

 

expenses paid under this act. The attorney general shall recover

 

any cost or attorney fees associated with a recovery under this

 

subsection.

 

     (4) Except as provided in subsection (6), the individual or

 

his or her representative must certify that he or she has provided

 

notice and a copy of the complaint to the state department, on the

 

summons and complaint form, in a manner to be determined by the

 

state court administrator.

 

     (5) Except as provided in subsection (6), if an individual or

 

his or her representative seeks to settle an action in which the

 

state department may have a right to recover expenses paid under

 

this act without filing a complaint, the individual or his or her

 

representative must notify the state department in writing before

 

beginning settlement discussions. The parties to the settlement

 

discussions must allow the department or its representative an

 

opportunity to participate in those settlement discussions. If the

 

individual is enrolled in a medicaid contracted health plan, the

 

individual or his or her representative must notify the medicaid

 

contracted health plan in writing and allow the medicaid contracted

 

health plan or its representative an opportunity to participate in

 

the settlement discussions in addition to providing notice to the

 

state department before the matter is settled.

 

     (6) If the individual is represented by legal counsel, the

 

legal counsel and not the individual or his or her representative

 

must do all of the following:

 

     (a) Certify that he or she has provided notice and a copy of

 

the complaint to the state department, on the summons and complaint

 

form, in a manner to be determined by the state court

 

administrator. This certification must be made on all cases that

 

are no-fault automobile insurance cases, medical malpractice cases,

 

personal injury-automobile negligence cases, other personal injury

 

cases, or any other case in which the state department may have a

 

right to recover expenses paid under this act.

 

     (b) Notify the state department in writing before beginning

 

settlement discussions. The parties to the discussions must allow

 

the department or its representative an opportunity to participate

 

in those settlement discussions.

 

     (c) Notify the medicaid contracted health plan in writing in

 

addition to providing notice to the state department before the

 

matter is settled.

 

     (7) If notice was not given as required in subsection (3) or

 

(5), the state department or the medicaid contracted health plan is

 

entitled to recover from the individual all of the medical expenses

 

paid under this act and attorney fees and costs associated with

 

recovering the medical expenses paid under this act.

 

     (8) If no complaint has been filed, but the claim was settled

 

and notice of the settlement was not given as required in

 

subsection (3) or (5), the state department is entitled to recover

 

from the individual all of the medical expenses paid under this act

 

and attorney fees and costs associated with recovering the medical

 

expenses paid under this act.

 

     (9) (5) The state department has first priority against the

 

proceeds of the net recovery from the settlement or judgment in an

 

action settled in which notice has been provided under subsection

 

(3) or (5). A medicaid contracted health plan has priority

 

immediately after the state department in an action settled in

 

which notice has been provided under subsection (3) or (5). The

 

state department and a medicaid contracted health plan shall

 

recover the full cost of expenses paid under this act unless the

 

state department or the medicaid contracted health plan agrees to

 

accept an amount less than the full amount. If the individual would

 

recover less against the proceeds of the net recovery than the

 

expenses paid under this act, the state department or medicaid

 

contracted health plan, and the individual shall share equally in

 

the proceeds of the net recovery. As used in this subsection, "net

 

recovery" means the total settlement or judgment less the costs and

 

fees incurred by or on behalf of the individual who obtains the

 

settlement or judgment.