TPL

Third Party Liability

In some cases, Medicaid beneficiaries may have more than one source of coverage for health care services, such as group health plans, self-insured plans, or managed care organizations. Third Party Liability (TPL) systems identify these situations to ensure that the appropriate party pays for services.

CMS-Required Outcomes (13)

Ref	Outcome	Sources
TPL1 Application	The system does the following: - Records third parties, - Determines the liability of third parties, - Avoids payment of third-party claims, - Recovers reimbursement from third parties after Medicaid claims payment, and - Records information and actions related to the plan.	42 CFR 433.138(k)(2)(i)
TPL2 Health Insurance Information	The system records other health insurance information at the time of application or renewal for Medicaid eligibility that would be useful in identifying legally liable third-party resources.	42 CFR 433.136 42 CFR 433.137 42 CFR 433.138Section 1902(a)(25) of the Act
TPL3 Information to Determine Legal Liability	The system uses electronic exchange state wage information collection agency. The system(s) regularly updates the member file with any third-party liability information, how long it is valid, and for what services, through regular automated checks with these databases.	42 CFR 433.138(d)42 CFR 435.4State Plan
TPL4 Rejection Based on TPL	The system rejects and returns to the provider for a determination of the amount of liability for all claims for which the probable existence of third-party liability is established at the time the claim is filed.	42 CFR 433.139(b)
TPL5 Pay and Chase Identification	For claims identified with a third-party liability and designated as 'mandatory pay and chase,' the system makes appropriate payments and identifies such claims for future recovery. (Examples include preventive pediatric services provided to children, or medical child support from an absent parent.)	42 CFR 433.139(b)(3)(ii)Section 1902(a)(25) of the Act
TPL6 Pay and Chase Timeline	The system(s) supports providing up to 100 days to pay claims related to medical support enforcement, preventive pediatric services, labor and delivery, and postpartum care that are subject to 'pay and chase.' If a state cannot differentiate the costs for prenatal services from labor and delivery on the claim, it will have to cost avoid the entire claim.	Bipartisan Budget Act of 2018, Sec. 53102Section 1902(a)(25) of the ActCMCS Informational Bulleting (CIB) November 14, 2019 (pg. 2)
TPL7 Claims Identification for TPL	The system identifies paid claims that contain diagnosis codes indicative of trauma, injury, poisoning, and other consequences of external causes on a routine and timely basis for the purposes of determining legal liability of third parties.	42 CFR 433.138(e)
TPL8 Probable TPL Determination Timeline	The system identifies probable TPL within 60 days after the end of the month in which payment has been made (unless there is an approved waiver to not recoup funds).	42 CFR 433.139(d)
TPL9 Report Generation	The system can generate reports on data exchanges and trauma codes so that the state can evaluate its TPL identification process.	42 CFR 433.138(j)
TPL10 Cost Effectiveness	The system enables the agency to seek reimbursement from a liable third party on all claims for which it is cost effective.	42 CFR 433.139(f)
TPL11 MCO TPL Recovery	As determined by the state policies, system(s) enables the state to manage and oversee TPL recoveries made by its MCOs.	COB/TPL Training and Handbook- 2020 (pg. 53-55)
TPL12 Privacy and Security	Before requesting information from or releasing information to other agencies to identify legally liable third-party resources, state must execute data exchange agreements with those agencies.	42 CFR 433.138(h)
TPL13 Reimbursement Tracking	The system tracks TPL reimbursements received so that the state can reimburse the federal government in accordance with the state's FMAP.	42 CFR 433.140