Medicaid Third Party Liability Act
Sponsored By: Representative Crenshaw
Introduced
Summary
States would have to verify third-party health coverage before Medicaid pays. The bill would repeal special exceptions that let Medicaid pay first for preventive pediatric care and for services tied to child support enforcement and would create rules for how states contract with insurers about recovery and assignment of payment rights.
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- Families and children: Preventive pediatric care that previously qualified for a Medicaid-first exception would instead be billed to any legally liable third-party insurer when coverage exists.
- State Medicaid programs and enrollees: States would be required to collect and verify whether an individual has third-party coverage, and after January 1, 2026, the federal government would not pay for services for which the state did not obtain and verify that information.
- Health insurers and plans: States could contract with insurers, including group and self-insured plans, managed care organizations, and pharmacy benefit managers, to delegate recovery rights or accept assignments of payment rights from beneficiaries.
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Bill Overview
Analyzed Economic Effects
4 provisions identified: 1 benefits, 1 costs, 2 mixed.
Stricter Medicaid checks for other insurance
If enacted, Medicaid applications would ask if you have other health insurance and the plan name. States would need to get and verify this information. For care paid after January 1, 2026, the federal match would not pay if the State did not verify it. This could add paperwork for applicants and push costs to States that do not verify.
Ends special carve‑outs in Medicaid recovery
If enacted, the bill would remove two special rules in Medicaid’s third‑party liability section. This could change how some services and payments are treated when another payer is responsible. The change would start upon enactment.
States may let insurers recover payments
If enacted, starting after January 1, 2026, State contracts with health insurers would have to say if the State lets the insurer recover from other responsible parties and if any assigned rights are transferred. If a State chooses this, it would need to assure the federal government that State law gives the insurer the needed authority. After January 1, 2026, States would also have to recognize certain authorizations made under the State plan as valid. This could change who pursues repayment and how billing is handled.
More time for states to comply
If enacted, States that need new State laws to meet these rules would get extra time. They would not be treated as out of compliance until the first day of the first calendar quarter after their next regular session ends. In States with two‑year sessions, each year would count as a separate session. This would start upon enactment.
Sponsors & CoSponsors
Sponsor
Crenshaw
TX • R
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
No roll call votes available for this bill.
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