(a) Providers must make a good faith effort to determine whether a recipient is or may be insured by a third party resource at the time services are provided, by making a reasonable attempt to verify with the recipient either orally or in writing.
(b) If a third party resource is identified, providers are required to bill the third party resource before submitting a claim for payment to HHSC under the provisions of §354.1003 of this chapter (relating to Time Limits for Submitted Claims) unless otherwise directed by HHSC.
(c) Providers who identify a third party resource, within 12 months from the date of service, and wish to submit a claim for payment to a third party resource after a claim for payment has been submitted and paid by HHSC, must refund any amounts paid by Medicaid prior to submitting a claim for payment to the third party resource.
(d) Providers are limited to the Medicaid payable amount and the provider is required to accept the amount paid by HHSC as payment in full if:
  (1) a claim for payment is submitted to and paid by HHSC; and
  (2) the provider failed to inform HHSC at the time the claim was filed, or any time thereafter, that a third party resource was also billed for the same service.
(e) Payments made by a third party resource to a provider who is limited to the Medicaid payable amount under subsection (d) of this section must be forwarded to HHSC for distribution as follows:
  (1) for fee-for-service (FFS), according to the provisions of §354.2334 of this subchapter (relating to Notices and Payments); or
  (2) for Medicaid managed care, according to provisions as outlined in the provider's contract with an MCO.
(f) If the amount paid by a third party resource is less than the amount payable for the service by Medicaid, HHSC may be billed for the difference between the amount paid by the third party resource and the Medicaid payable amount, if a claim was timely filed with HHSC under the provisions of §354.1003 of this chapter.
(g) Any provider who accepts Medicaid payment as payment in full for health care items or services and retains any amount in excess of the Medicaid payable amount from a third party resource and conceals or fails to account to HHSC for the third party amount, resulting in excessive or duplicate payment for the same health care items or services, may be referred for investigation and prosecution for violations of state or federal Medicaid or false claims laws, or both.
(h) Providers are prohibited from submitting a bill, or other written demand for payment or collection of debt for any Medicaid-covered service from an individual who the provider knows or should know is a Medicaid eligible recipient or from the representative of a recipient, regardless of whether a claim for payment for the service is submitted to HHSC. This section does not prohibit a provider from submitting reasonable inquiries or requests for information to a recipient, or representative of a recipient to assist the provider in identifying a third party resource. However, any inquiry which would lead a reasonable person to believe that the provider was making a demand for payment, or attempting to collect an unpaid debt, will bring the provider within the limitations and prohibitions as follows.
  (1) If a provider attempts to recover any amount from a recipient for any Medicaid-covered service, HHSC may provide for a reduction of an amount otherwise payable to the provider in addition to referring the provider for investigation and prosecution for violations of state or federal Medicaid or false claims laws, or both.
  (2) The amount of the reduction may be up to three times the amount the provider sought in excess of the Medicaid payable amount.
(i) Providers are prohibited from refusing to provide health care items or services to a Medicaid recipient because the recipient has a third party resource that may potentially be liable for payment of health care items or services.
(j) Eventual recovery, repayment or recoupment of money by HHSC or the recipient will not release or preclude referral by HHSC for investigation, prosecution or liability under any civil or criminal law which would otherwise apply to the unlawful conduct.
(k) HHSC will not accept any claim for payment under this section submitted after 18 months from the date of service, regardless of whether an informational claim has been timely filed.
(l) A payment made by a third party resource to HHSC or a provider on a claim for payment of a health care item or service provided to a Medicaid recipient is final on the date that is two years after the third party payment was made. After a claim is final, the claim is subject to adjustment only if an action for recovery of an overpayment was commenced under subsection (b) of this section before the date the claim became final and the recovery is agreed to by HHSC under subsection (c) of this section.
(m) If a third party resource determines that it overpaid a claim for payment, the third party resource may seek to recover all or part of the overpayment by filing a notice of its intent to seek recovery with HHSC in writing before the date the payment is final. The notice must specify all of the following:
  (1) the full name of the Medicaid recipient who received the health care item or service that is the subject of the claim;
  (2) the date on which the health care item or service was provided;
  (3) the amount allegedly overpaid and the amount the third party resource seeks to recover;
  (4) the claim number and any other number HHSC has assigned to the claim;
  (5) the third party resource's rationale for seeking recovery;
  (6) the date the third party resource made the payment and the method of payment used;
  (7) if payment was made by check, the check number; and
  (8) whether the third party resource would prefer to receive payment from HHSC, or prefer HHSC to offset the amount from a future payment.

Source Note: The provisions of this §354.2321 adopted to be effective April 30, 1999, 24 TexReg 3083; transferred effective September 1, 2001, as published in the Texas Register May 24, 2002, 27 TexReg 4562; amended to be effective March 28, 2004, 29 TexReg 2867; amended to be effective February 22, 2024, 49 TexReg 855