§446. Recovery of medical assistance payments; notice; pleadings; compromise; prescription; privilege for reimbursement of Medicaid payments

A. As used in this Section, the following terms have the meaning ascribed in this Subsection:

(1) "Department" means the Louisiana Department of Health.

(2) "Medicaid" means the medical assistance program provided for in Title XIX of the Social Security Act.

(3) "Medicaid managed care organization" means any private entity that contracts with the department to provide Medicaid benefits and services to enrollees of the Medicaid program.

B. When an injury has been sustained or an illness or death incurred by any person under circumstances creating in some third person or legal entity a legal liability or obligation to pay damages or compensation to that person or to his spouse, representative, or dependent, the department shall have a cause of action against such third party to recover the medical assistance payments the department has paid or is obligated to pay on behalf of the injured, ill, or deceased person in connection with the injury, illness, or death. The department, a Medicaid managed care organization, or both, may intervene in a suit filed by or on behalf of the injured, ill, or deceased person or his spouse, representative, or dependent against such third party to recover the medical assistance payments the department, Medicaid managed care organization, or each, has paid or is obligated to pay on behalf of the injured, ill, or deceased person in connection with said injury, illness, or death.

C. Any person or his spouse, representative, or dependent who files suit for the recovery of damages or compensation as the result of an injury, illness, or death for which medical assistance payments in whole or in part have been paid by the department, a Medicaid managed care organization, or both, for which the department, Medicaid managed care organization, or each, has an obligation to pay therefor, shall at the time suit is filed cause a copy of the petition to be served on the department, Medicaid managed care organization, or both, in the manner prescribed by Article 1313 of the Louisiana Code of Civil Procedure. Such person filing suit shall be responsible to the department, Medicaid managed care organization, or both, to the extent of the medical assistance payments received, interest, and attorney fees if he fails to have service made upon the department, Medicaid managed care organization, or both. Such person shall also be responsible to the department, Medicaid managed care organization, or both, if he compromises his claim without giving the department, Medicaid managed care organization, or both, written notice at least thirty days before the compromise is affected. This written notice shall include the name and date of birth of all injured or ill recipients and the name and address of the party or parties potentially liable for damages or compensation.

D. Pleadings filed on behalf of the department or Medicaid managed care organization shall be accompanied by an itemized statement of its monetary claim, and when accompanied by an affidavit to the correctness thereof to the best of the affiant's knowledge and belief, such itemized statement shall be accepted as prima facie proof of the amount, purpose, and necessity of such payments.

E. No compromise of any claim referred to in Subsections B and C of this Section shall be binding upon or affect the rights of the department or a Medicaid managed care organization against a third party if the department or Medicaid managed care organization has notified such third party in writing of the amount of its claim prior to the date the compromise settlement is made. The notice provided for herein may be directed to either the third party or his agent.

F. An intervention filed by the department or a Medicaid managed care organization as provided by Subsection B of this Section is not barred by prescription if it was not barred at the time the main demand was filed, provided such intervention is filed within ninety days of the date of service of the main demand upon the department.

G. The department and a Medicaid managed care organization shall have a privilege for the medical assistance payments made by the department or Medicaid managed care organization on behalf of an injured or ill Medicaid recipient on the amount payable to the injured recipient, his heirs, or legal representatives out of the total amount of any recovery or sum had, collected, or to be collected, whether by judgment, settlement, or compromise, from another person on account of such injuries, and on the amount payable by any insurance company under any contract providing for indemnity or compensation to the injured person. The privilege of an attorney shall have precedence over the privilege created under this Section.

H. The privilege created in Subsection G of this Section shall become effective if, prior to the payment of insurance proceeds, or to the payment of any judgment, settlement, or compromise on account of injuries, a written notice containing the name and address of the injured person, and if known, the name of the person alleged to be liable to the injured person on account of the injuries received, is mailed by the department, a Medicaid managed care organization, or an attorney or agent of either, by certified mail, return receipt requested, to the injured person, to his attorney, to the person alleged to be liable to the injured person on account of the injuries sustained, to any insurance carrier which has insured such person against liability, and to any insurance company obligated by contract to pay indemnity or compensation to the injured person. This privilege shall be effective against the persons given notice according to the provisions hereof, and shall not be defeated nor rendered ineffective as against the persons who have been given such notice, because of failure to give such notice to other persons named herein.

I. Any insurer, potentially liable third party, or other person who, having received notice in accordance with the provisions of this Section, pays over any monies subject to the privilege created herein to any injured person, or to the attorney, heirs, or legal representatives of any injured person, and any injured person, his legal representative, or attorney who receives monies subject to the privilege created in Subsection G of this Section shall be liable to the department, Medicaid managed care organization, or both, for the amount of the privilege not to exceed the amount paid by the insurer, potentially liable third party, or other person.

J. Nothing in this Section shall be construed to create any statutory lien or privilege on any life insurance proceeds or trust proceeds in favor of any third person.

Acts 1972, No. 411, §§1 to 5. Amended by Acts 1974, No. 362, §1; Acts 1978, No. 786, §6, eff. July 17, 1978; Acts 1983, 1st Ex.Sess., No. 1, §6; Acts 1997, No. 806, §1; Acts 1999, No. 1115, §1; Acts 2014, No. 824, §1.