MISSISSIPPI LEGISLATURE

2000 Regular Session

To: Insurance

By: Senator(s) Kirby

AN ACT TO CREATE A NEW SECTION TO BE CODIFIED AS SECTION 25-15-107, MISSISSIPPI CODE OF 1972, TO PROVIDE SUBROGATION RIGHTS UNDER SELF-INSURED AND POOLED RISKS HEALTH INSURANCE PLANS FOR POLITICAL SUBDIVISIONS OF THE STATE; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. The following shall be codified as Section 25-15-107, Mississippi Code of 1972:

25-15-107. (1) If medical assistance is provided to an employee or dependant under this article for injuries, disease or sickness caused under circumstances creating a cause of action in favor of the employee or eligible dependent against any person, firm or corporation, then the political subdivision or its designee shall be entitled to recover the proceeds that may result from the exercise of any rights of recovery which the employee or dependent may have against any such person, firm or corporation to the extent of the actual amount of the medical payments made by the plan on behalf of the employee or dependent. The employee dependent shall execute and deliver instruments and papers to do whatever is necessary to secure such rights and shall do nothing after the medical assistance is provided to prejudice the subrogation rights of the board. The political subdivision or its designee may compromise or settle any such claim and execute a release of any claim it has by virtue of this section.

(2) The acceptance of medical assistance under this article or making of a claim thereunder shall not affect the right of the employee, dependent or his legal representative to recover the medical assistance payments made by the plan as an element of special or general damages in any action at law or as part of any settlement in favor of the employee or eligible dependent against any person, firm or corporation. However, if an action at law is pursued, a copy of the pleadings shall be mailed certified to the political subdivision or its designee at the time of the institution of suit, and proof of such notice shall be filed of record in such action. The political subdivision, at any time before the trial on the facts, may join in such action or may intervene therein. Any amount recovered by an employee, dependent or legal representative shall be applied in the following order:

(a) The reasonable cost of the collection, including attorney's fees;

(b) The actual amount of the medical assistance payments made by the plan on behalf of the employee, or dependent or such pro rata amount as may be arrived at by the political subdivision or its designee and the employee, dependent or his legal representative, or as set by the court having jurisdiction, based upon admissible evidence, using the order of precedence of liens set forth herein;

(c) Any excess shall be awarded to the employee or dependent.

(3) No compromise of any claim by the employee, dependent or his legal representative shall be binding upon or affect the rights of the political subdivision against the third party unless the political subdivision or its designee has entered into the compromise. Any compromise effected by the employee, dependent or legal representative with the third party in the absence of advance notification to and approval by the political subdivision or its designee shall constitute conclusive evidence of the liability of the third party, and the political subdivision or its designee in litigating its claim against the third party shall be required only to prove the amount and correctness of its claim relating to such injury, disease or sickness. It is further provided that should the employee, dependent or his legal representative fail to notify the political subdivision or its designee of the institution of legal proceedings against a third party for which the political subdivision has a cause of action, the facts relating to negligence and the liability of the third party, if judgment is rendered for the employee or dependent, shall constitute conclusive evidence of liability in a subsequent action maintained by the political subdivision or its designee and only the amount and correctness of the political subdivision's claim relating to the injuries, disease or sickness shall be tried before the court. The political subdivision shall be authorized in bringing such action against the third party and his insurer jointly or against the insurer alone.

(4) Nothing herein shall be construed to diminish or otherwise restrict the subrogation right of the political subdivision against a third party for medical assistance paid by the plan in behalf of the employee or dependent as a result of injuries, disease or sickness caused under circumstances creating a cause of action in favor of the employee or dependent against such a third party.

SECTION 2. This act shall take effect and be in force from and after March 18, 1999.