SENATE BILL 537

47th legislature - STATE OF NEW MEXICO - first session, 2005

INTRODUCED BY

John T.L. Grubesic

AN ACT

RELATING TO MEDICAID; CLARIFYING THIRD-PARTY LIABILITY AND ASSIGNMENT OF RIGHTS; AMENDING A SECTION OF THE PUBLIC ASSISTANCE ACT.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     Section 1. Section 27-2-23 NMSA 1978 (being Laws 1969, Chapter 232, Section 1) is amended to read:

     "27-2-23. THIRD PARTY LIABILITY.--

          A. Medicaid is the payor of last resort for medically necessary goods and services furnished to medicaid recipients.

          [A.] B. The [health and social services] department shall make reasonable efforts to ascertain any legal liability of third parties who are or may be liable to pay all or part of the medical cost of injury, disease or disability of an applicant for or recipient of medical assistance.

          C. An applicant, recipient or legal representative shall inform the department of:

                (1) any rights the applicant or recipient has to third-party benefits; and

                (2) the name and address of a person that is or may be liable to provide third-party benefits.

          D. A health care provider shall notify the department when the health care provider has reason to believe that a third party may be liable for payment of the costs of health care services provided to medicaid recipients.

          [B.] E. When the department makes medical assistance payments [in] on behalf of a recipient, the department is subrogated to any right of the recipient against a third party for recovery of medical expenses to the extent that the department has made payment.

          F. The application for medicaid benefits shall constitute an assignment to the department, as described in Section 27-2-28 NMSA 1978, of a medicaid applicant's right to any settlement, judgment or award that may be obtained against a third party to the full extent of the amount of medical assistance provided by medicaid for the benefit of the applicant.

          G. The assignment made by submitting an application for medicaid shall be considered a statutory lien on any settlement, judgment or award received by the recipient from a liable third party.

          H. In regard to all or part of a lien, the department may:

                (1) compromise or settle the lien; or

                (2) in circumstances of hardship, waive the lien.

          I. Whenever the department's recovery under the lien is the result of an action initiated by a medicaid recipient, the attorney for the medicaid recipient is entitled to the department's pro rata share of the recipient's attorney fees and costs. Attorney fees shall not exceed:

                (1) one-third of the settlement for cases settled prior to trial; or

                (2) two-fifths of the settlement, judgment or award recovered in cases when a trial is convened." 

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