Medicaid Third Party Liability Act

Section 1902(a)(25) of the Social Security Act (42 U.S.C. 1396a(a)(25)) is amended by striking subparagraphs (E) and (F) and redesignating the subsequent subparagraphs accordingly.

Section 1902(a)(25) of the Social Security Act (42 U.S.C. 1396a(a)(25)), as amended by subsection (a), is further amended—

(1) in subparagraph (F) (as so redesignated), by striking at the end and;

(2) in subparagraph (G) (as so redesignated), by striking the period at the end and inserting; and; and

(3) by adding at the end the following new subparagraph:

(H) that, in the case of a State after January 1, 2026, that provides medical assistance under this title through a contract with a health insurer (including a group health plan (as defined in section 607(1) of the Employee Retirement Income Security Act of 1974), a self-insured plan, a fully insured plan, a service benefit plan, a managed care organization, a pharmacy benefit manager, or any other health plan determined appropriate by the Secretary)—

(i) such contract shall specify—

(I) whether the State is delegating to such insurer all or some of its right of recovery from a responsible third party for an item or service for which payment has been made under the State plan (or under a waiver of the plan); and

(II) whether the State is transferring to such insurer all or some of the assignment to the State of any right of an individual or other entity to payment from a responsible third party for an item or service for which payment has been made under the State plan (or under a waiver of the plan); and

(ii) in the case of a State that elects an option described in subclause (I) or (I) of clause (i) with respect to a health insurer (including a group health plan (as defined in section 607(1) of the Employee Retirement Income Security Act of 1974), self-insured plan, a fully insured plan, a service benefit plan, a managed care organization, a pharmacy benefit manager, and any other health plan determined appropriate by the Secretary), the State shall provide assurances to the Secretary that the State laws referred to in subparagraph (G) confer to the health insurer the authority of the State with respect to the requirements specified in clauses (i) through (iv) of such subparagraph.

Section 1902(a)(25)(G)(ii) of the Social Security Act (42 U.S.C. 1396a(a)(25)(G)(ii)), as so redesignated by subsection (a), is amended to read as follows:

(ii) accept—

(I) the State’s right of recovery and the assignment to the State of any right of an individual or other entity to payment from the party for an item or service for which payment has been made under the respective State’s plan (or under a waiver of the plan); and

(II) after January 1, 2026, as a valid authorization of the responsible third party for the furnishing of an item or service to an individual eligible to receive medical assistance under this title, an authorization made on behalf of such individual under the State plan (or under a waiver of such plan) for the furnishing of such item or service to such individual;

Section 1902(a)(25)(A)(i) of the Social Security Act (42 U.S.C. 1396a(a)(25)(A)(i)) is amended by inserting, including the collection of, with respect to an individual seeking to receive medical assistance under this title, information on whether the individual has health insurance coverage provided through a third party (as described in such paragraph) and the plan of such insurer in which the individual is enrolled, after in regulations).

Section 1903(i) of the Social Security Act (42 U.S.C. 1396b(i)) is amended—

(A) in paragraph (26), by striking; or and inserting;;

(B) in paragraph (27), by striking of the State. and inserting of the State; or; and

(C) by inserting after paragraph (27) the following:

(28) with respect to any amounts after January 1, 2026, expended for medical assistance for individuals for whom the State has not obtained and verified, in accordance with section 1902(a)(25)(A)(i), information on whether such an individual has coverage provided through a third party (as described in such paragraph) and the plan of such coverage in which the individual is enrolled.