May 18, 2006, Introduced by Reps. Jones, Steil, Wenke, Schuitmaker, Hune, Polidori, Miller and Pearce and referred to the Committee on Senior Health, Security, and Retirement.
A bill to amend 1939 PA 280, entitled
"The social welfare act,"
by amending section 106 (MCL 400.106), as amended by 2004 PA 409.
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 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
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 higher
of the payment standards generally used to determine eligibility in
the family independence program and the supplemental security
income program under title XVI, including state supplementation.
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 family independence agency 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 health of the insured makes
continuance of 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 the rules of the family independence agency; 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;
the amount a nursing home is required to pay an individual under
section 21799c(4) of the public health code, 1978 PA 368, MCL
333.21799c; 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, except for
income or income and resources; or is a child from 18 to 21 years
of age and his or her adult caretaker would be eligible for family
independence program benefits except for age, income, or income and
resources; or is a child under 21 years of age and is from a family
whose income is below the basic maintenance level.
(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 individual receiving medical assistance under this act
or his or her legal counsel shall notify the state department when
filing an action in which the state department may have a right to
recover expenses paid under this act. If the individual is enrolled
in a medicaid contracted health plan, the individual or his or her
legal counsel shall provide notice to the contracted health plan in
addition to providing notice to the state department.
(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 the date of
the amendatory act that added this subsection 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.
(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). 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). 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.
Enacting section 1. This amendatory act does not take effect
unless Senate Bill No.____ or House Bill No. 5931(request no.
02485'05) of the 93rd Legislature is enacted into law.