Could Connecticut share Medicaid claims data to investigate private insurers’ unpaid care costs?

Plain-English summary

In 2005, Connecticut's social services commissioner asked whether Medicaid paid claims data could be shared with the Attorney General and Child Advocate. They were investigating whether private insurers had failed to pay for care provided to children, leaving Medicaid to bear costs those insurers might owe. The AG said the disclosure was permitted because pursuing third party liability was directly connected with administration of the Medicaid program.

The opinion addressed this particular investigative purpose. It did not treat Medicaid recipient information as generally open for unrelated uses.

Currency note

This opinion was issued in 2005. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Social services and investigators at the time

The AG linked disclosure to the state's duty to identify and recover payments owed by third parties. He concluded that sharing paid claims information for the described inquiry fit the federal administrative purpose exception.

Medicaid recipients at the time

The records concerned care paid for children in the program. The AG's analysis turned on the specific recovery inquiry, not on a public right of access to private medical data.

Common questions

Q: Could the state share Medicaid claims data with its insurer liability investigators?
A: The AG said yes for the described Attorney General and Child Advocate investigation into whether private insurers should have paid the claims.

Q: Why did federal confidentiality law permit that use?
A: The AG treated third party recovery as part of administering Medicaid, the purpose required by the federal disclosure rule.

Background and statutory framework

The AG read the restriction in 42 C.F.R. § 431.300(a) alongside Medicaid third party liability requirements, including 42 U.S.C. § 1396a(25)(A), and the state's subrogation right in Conn. Gen. Stat. § 17b-265(a). He concluded the requested data use served recovery of costs properly owed by insurers.

Citations and references

Authorities cited in the opinion: 42 C.F.R. § 431.300(a); Conn. Gen. Stat. § 17b-265(a); 42 U.S.C. § 1396a(25)(A).

Source

• Landing page: https://portal.ct.gov/AG/Opinions
• Opinion page: https://portal.ct.gov/ag/opinions/2005-formal-opinions/the-honorable-patricia-wilsoncoker-department-of-social-services-2005006-formal-opinion-attorney-gen

Original opinion text

The Honorable Patricia Wilson-Coker, Department of Social Services, 2005-006 Formal Opinion, Attorney General of Connecticut

Attorney General's Opinion

Attorney General, Richard Blumenthal

February 15, 2005

Honorable Patricia Wilson-Coker

Department of Social Services

25 Sigourney Street

Hartford, CT 06106-5033

Dear Commissioner Wilson-Coker:

This is in response to your request for an Attorney General's Opinion on whether the disclosure by the Department of Social Services ("DSS") to the Offices of the Connecticut Attorney General and the Connecticut Child Advocate of information concerning Medicaid medical assistance recipients, to be used in an investigation into the liability of insurance companies for the cost of services paid for by Medicaid, is provided for purposes directly connected with the administration of the Medicaid program, and is fully permitted by federal law.

As you know, the Offices of the Attorney General and the Child Advocate have undertaken a joint investigation of Connecticut's mental health care system for children. Although my office obviously is involved in the investigation itself, my view is that the urgent and clear public policy and legal answers to your inquiry fully justify our responding.

One important aspect of our investigation will be an analysis of whether health insurance companies have improperly refused to pay for treatment needed by mentally ill children enrolled in Medicaid, or other State assistance programs, thereby improperly shifting costs from the insurance companies to the taxpayers. To further this review, the Attorney General and the Child Advocate have requested DSS to furnish them with "paid claims" data showing details about the services DSS has paid for. Investigators plan to identify State-paid services delivered to children listed by DSS as insured by commercial health insurance plans. They will then audit claims on a sample basis, reviewing provider care records and interviewing patient families where appropriate, to conclude whether the services involved should have been covered by private insurance.

Medicaid is a federal program implemented at the state level through state plans that must comply with federal requirements in order to receive federal funding. See 42 U.S.C. § 1396a. In Connecticut the program is administered by DSS. Conn. Gen. Stat. § 17b-2. Because Medicaid is a "payor of last resort," 42 U.S.C. § 1369a(a)(25) requires states to implement "third party liability (TPL) programs" which "ensure that Federal and State funds are not misspent for covered services to eligible Medicaid recipients when third parties exist that are legally liable to pay for those services." Medicaid Programs; State Plan Requirements and Other Provisions Relating to State Third Party Liability Programs, 55 Fed. Reg. 1423, 1423-24 (1990). The Medicaid statute requires that each state agency administering the Medicaid program take measures to find out when third parties (like private insurers) are legally obligated to pay for services covered by the plan. See 42 U.S.C. § 1396a(25)(A). Each state plan must include a method of pursuing claims against such third parties. See id. If third party liability is discovered after medical care has been provided, the state agency must seek reimbursement from the third party. See 42 U.S.C. § 1396a(25)(B); Wesley Health Care Center, Inc. v. DeBuono, 244 F.3d 280, 281 (2nd Cir. 2001).

A State Medicaid plan must provide that, as a condition of eligibility, the recipient assign to the State any right the recipient has to payment for medical care from any third party. 42 U.S.C. § 1396k(a)(1)(A). The recipient must cooperate with the State by providing information and assisting the State in pursuing any liable third party. 42 U.S.C. § 1396k(a)(1)(C). Under Connecticut law, DSS is subrogated to the recipient's right to recovery from any private insurer or other third party. Conn. Gen. Stat. § 17b-265(a).

Federal law forbids DSS from disclosing information about Medicaid recipients unless the disclosure is for "purposes directly connected with the administration of the [Medicaid] plan." 42 C.F.R. § 431.300(a). As stated, DSS is obligated to pursue contributions that may be due from any private insurer, and recipients are required to assist in all third-party recovery efforts. Recipient information is sought to pursue an investigation seeking to determine whether private insurance companies have improperly refused to pay for treatment needed by mentally ill children enrolled in Medicaid or other State assistance programs. Accordingly, the information is sought "for purposes directly connected with the administration of the [Medicaid] plan," and is permitted by both federal and state law.

Very truly yours,

RICHARD BLUMENTHAL

ATTORNEY GENERAL