407 IAC 1-2-6 - Subrogation of claims and third party liability

Authority: IC 12-17.6-2-11

Affected: IC 12-17.6

Sec. 6.

(a) By applying for and accepting benefits under the CHIP program, a CHIP applicant or member or one legally authorized to act on behalf of an applicant or member shall be considered to have assigned to the office the member's rights to medical payments from any responsible third party.

(b) The office shall be subrogated to all claims by CHIP members against third parties to the extent of CHIP benefits paid by the office.

(c) The office, acting on behalf of the CHIP member, may initiate an action against a third party that is or may be liable for the injury, illness, or disease of a CHIP member when:

(1) the member has not done so; and

(2) the time remaining under the statute of limitations for the action is six (6) months or less.

(d) The office may seek reimbursement from any money or fund payable by any third party who is or may be liable for the medical expenses of a CHIP member when CHIP provides benefits. Circumstances under which the office may seek reimbursement include, but are not limited to, cases where CHIP has made payment because:

(1) payment from a third party was not immediately available;

(2) there are disputes and delays in the coordination of benefits;

(3) the third party was not identified;

(4) the office erroneously made payment before the third party or all other parties had made payment;

(5) a court order has been issued; or

(6) the member asserts a claim against a third party who is or may be liable for the injury, illness, or disease of a CHIP applicant or member.

(e) The office may enforce its right to seek reimbursement by serving notice to third parties in the following manner:

(1) By sending a notice to the following persons or entities if the appropriate names and addresses are determined:

(A) The member.

(B) The member's attorney.

(C) The insurer or other third parties.

(2) The notice under this subsection shall include the following:

(A) The name and address of the member.

(B) That the individual is eligible for CHIP.

(C) The name of the person or third party alleged to be liable to the injured or ill member.

(f) Before submitting a claim to the office or its contractor, the provider shall make reasonable efforts to determine whether a third party is responsible for payment of the service. If a responsible third party is identified, the provider must seek payment from the third party prior to billing CHIP.

(g) If the office has established the probable existence of third party liability at the time the claim is filed, the office may deny the claim and return it to the provider for a determination of the amount of liability. The establishment of third party liability takes place when the office receives confirmation from the provider or a third party resource indicating the extent of third party liability. When the amount of liability is determined, the office may then pay the claim to the extent that payment allowed under CHIP exceeds the amount of the third party's payment.

(h) If the probable existence of third party liability cannot be established or third party benefits are not available to pay the recipient's medical expenses at the time the claim is filed, the office may pay the full amount allowed under CHIP program and seek recovery of reimbursement from the third party.

(i) The office may waive its right to seek reimbursement under this section, at its discretion.

Notes

407 IAC 1-2-6

Office of the Children's Health Insurance Program; 407 IAC 1-2-6; filed May 3, 2000, 2:02 p.m.: 23 IR 2228; errata filed Aug 2, 2000, 3:21 p.m.: 23 IR 3091; readopted filed May 22, 2006, 3:22 p.m.: 29 IR 3424; readopted filed Jun 18, 2012, 11:23 a.m.: 20120718-IR-407120202RFA