1. (a) TPRs must be applied toward the client's medical and health expenses. Medicaid is usually the payor of last resort.

2. (b) TPRs include the following:

   1. (1) Individual or group health insurance. Health insurance policies include individual or group contracts and commercial hospital, medical, and surgical policies. A client may have medical insurance coverage from current employment, residual coverage from previous employment, or private insurance paid for by the client or a relative. A client's relative may have personal or group insurance that covers the client's medical expenses.
   2. (2) Government health insurance. Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) is available to dependent children and spouses of active, retired, and deceased military services personnel. Parts A and B of Medicare provide a TPR for Medicaid clients entitled to Medicare.
   3. (3) Liability or casualty insurance and court settlements. Accidental injuries may result in third parties being liable for medical expenses. The usual sources of payment for medical expenses in these situations are automobile insurance; homeowners insurance; owners, landlords, and tenants insurance; workers' compensation; and lawsuit settlements.
   4. (4) Direct providers. Direct providers are resources that provide the actual medical care at no cost to the client. These include VA facilities, public clinics, and health maintenance organizations (HMOs).

   5. (5) Long-term care insurance policies.

      1. (A) Long-term care insurance policies pay for nursing facility care. Benefits are specified in the policy purchased by the client.
      2. (B) Long-term care insurance policies do not affect Medicaid eligibility. If a client has such a policy, the eligibility specialist reports it as a third-party resource, using a Medical Insurance Input form.
3. (c) Persons applying for Medicaid automatically assign to the department their rights of recovery from TPRs to the extent that the department pays for the service. Medicaid clients must report to the department any TPR within 60 days of learning about the coverage or liability.

4. (d) The two methods for using TPRs are:

   1. (1) cost avoidance, in which available benefits are applied before Medicaid payment is made; and
   2. (2) post-payment recovery, in which Medicaid pays the medical costs before seeking reimbursement. A client must reimburse the department as soon as he receives the third-party payment for medical services already paid by Medicaid.
5. (e) Health insurance premium payment reimbursement program (HIPP). Once National Heritage Insurance Company (NHIC) has determined that the client's employer-based health insurance is cost-effective, participation in HIPP becomes a condition of eligibility. Denial of all benefits will result if the client voluntarily drops the coverage or fails to provide NHIC with the information needed to determine cost effectiveness.

Source Note:The provisions of this §358.215 adopted to be effective April 17, 1989, 14 TexReg 1083; amended to be effective October 1, 1995, 20 TexReg 7377; amended to be effective February 1, 1996, 21 TexReg 262; transferred effective September 1, 2004, as published in the Texas Register September 17, 2004, 29 TexReg 9013.