Senate File 546 - Enrolled

PAG LIN

1	1	SENATE FILE 546
1	2
1	3	AN ACT
1	4 RELATING TO A HOSPITAL LIEN.
1	5
1	6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1	7
1	8	Section 1.	NEW SECTION.	582.0A	DEFINITIONS.
1	9	1.	"Health plan" means an individual or group plan that
1 10 provides, or pays the costs of, medical care as that term is
1 11 defined in the federal Health Insurance Portability and
1 12 Accountability Act of 1996, Pub. L. No. 104=191 and
1 13 regulations promulgated thereunder.
1 14	2.	"Hospital" means a public or private institution
1 15 licensed pursuant to chapter 135B.
1 16	3.	"Provider agreement" means a contract, understanding,
1 17 or arrangement made by an association, corporation, county,
1 18 municipal corporation, or other institution maintaining a
1 19 hospital in the state, with any health plan or other entity
1 20 for the provision or payment of health care services.
1 21	Sec. 2.	Section 582.1, Code 2007, is amended to read as
1 22 follows:
1 23	582.1	NATURE OF LIEN.
1 24	1.	Every association, corporation, county, municipal

  1 25 corporation, or

other

institution, including a municipal

  1 26 corporation, maintaining a hospital in the state, which shall
1 27 furnish medical or other service to any patient injured by
1 28 reason of an accident not covered by the workers' compensation
1 29 Act, shall, if such injured party shall assert or maintain a
1 30 claim against another for damages on account of such injuries,
1 31 have a lien upon that part going or belonging to such patient
1 32 of any recovery or sum had or collected or to be collected by
1 33 such patient, or by the patient's heirs or personal
1 34 representatives in the case of the patient's death, whether by
35 judgment or by settlement or compromise to the amount of the
  2  1 reasonable and necessary charges of such hospital for the
  2  2 treatment, care, and maintenance of such patient in such
  2  3 hospital up to the date of payment of such damages; provided,
  2  4 however, that this to the amount of the reasonable and
  2  5 customary charges of such hospital for the treatment, care,
  2  6 and maintenance of such patient in such hospital up to the
  2  7 date of payment of such damages, except as provided in
  2  8 subsection 2.
9	2.  If a patient provides proof of insurance coverage under
  2 10 a health plan within thirty days of the patient's discharge
  2 11 from a hospital, the hospital shall submit all charges to the
  2 12 patient's health plan prior to filing the notice of the lien
  2 13 pursuant to section 582.2.  The patient's health plan shall
  2 14 not deny payment for hospital services received on the basis
  2 15 that a third party or other insurance carrier is responsible
  2 16 for the patient's injuries.  If the health plan denies payment
  2 17 for any other reason, the health plan shall nonetheless
  2 18 provide the hospital and the patient with a statement
  2 19 detailing the amount the health plan would have paid for the
  2 20 hospital services provided and the amount the patient would
  2 21 have been responsible for had the claim not been denied.  In
  2 22 such a case, the amount of the lien shall be limited to the
  2 23 amount the hospital would have received if such charges were
  2 24 covered by the patient's health plan.  A health plan's failure
  2 25 to provide a statement shall not affect the limitations on a
  2 26 hospital lien pursuant to this section.  This subsection shall
  2 27 not prohibit a hospital from filing notice of a lien pursuant
  2 28 to section 582.2 for the amount owed to the hospital due to
  2 29 patient responsibility including but not limited to
  2 30 deductibles, co=payments, and coinsurance.
31	3.  If at any time subsequent to the filing of the notice
  2 32 of the lien a hospital receives health plan information
  2 33 regarding a patient, the hospital shall not be required to
  2 34 withdraw notice of the lien but shall submit the hospital's
  2 35 charges to the health plan.  In such a case, the amount of the
  3  1 hospital's lien shall be limited pursuant to subsection 2.
2	4.  The lien shall not in any way prejudice or interfere
3	3 with any lien or contract which may be made by such patient or

3	4 the patient's heirs or personal representatives with any
3	5 attorney or attorneys for handling the claim on behalf of such
3	6 patient, the patient's heirs, or personal representatives;
3	7 provided, further, that the lien herein set forth shall not be
3	8 applied or considered valid against anyone coming under a

  3  9 patient covered under

the workers' compensation Act in this

  3 10 state pursuant to chapters 85, 85A, and 85B.
3 11	5.  A hospital that recovers from a judgment, verdict, or
  3 12 settlement pursuant to this chapter shall be responsible for
  3 13 the pro rata share of the legal and administrative expenses
  3 14 incurred in obtaining the judgment, verdict, or settlement.
3 15	Sec. 3.	Section 582.2, Code 2007, is amended to read as
3 16 follows:
3 17	582.2	WRITTEN NOTICE OF LIEN.
3 18	No such lien shall be effective, however, unless a written
3 19 notice containing the name and address of the injured person,
3 20 the date of the accident, the name and location of the
3 21 hospital, and the name of the person or persons, firm or
3 22 firms, corporation or corporations alleged to be liable to the
3 23 injured party for the injuries received, shall be filed in the
3 24 office of the clerk of the district court of the county in
3 25 which such hospital is located, prior to the payment of any
3 26 moneys to such injured person, the person's attorneys or legal
3 27 representative, as compensation for such injuries; nor unless
3 28 the hospital shall also mail, postage prepaid, a copy of such
3 29 notice with a statement of the date of filing thereof to the
3 30 person or persons, firm or firms, corporation or corporations
3 31 alleged to be liable to the injured party for the injuries
3 32 sustained prior to the payment of any moneys to such injured
3 33 person, the person's attorneys or legal representative, as
3 34 compensation for such injuries.	Such hospital shall mail a
35 copy of such notice to any insurance carrier which has insured
1 such person, firm or corporation against such liability, if
4	2 the name and address shall be known.	Such hospital shall also
  4  3 mail a copy of such notice to the injured person or to the
  4  4 injured person's attorney or legal representative, if known.
4	5	Sec. 4.	Section 582.3, Code 2007, is amended to read as
4	6 follows:
4	7	582.3	DURATION AND ENFORCEMENT OF LIEN.
4	8	1.	Any person or persons, firm or firms, or corporation or
  4  9 corporations, including an insurance carrier, making any
4 10 payment to such patient or to the patient's attorneys or heirs
4 11 or legal representatives as compensation for the injury
4 12 sustained, after the filing and mailing of such notice without
4 13 paying to such hospital the amount of its lien recoverable
  4 14 pursuant to section 582.1 from such person, firm, or
  4 15 corporation or so much thereof as can be satisfied out of the
4 16 moneys due under any final judgment or compromise or
4 17 settlement agreement, after paying the amount of any prior
4 18 liens, shall, for a period of one year from the date of
4 19 payment to such patient or the patient's heirs, attorneys, or
4 20 legal representatives, as aforesaid, be and remain liable to
4 21 such hospital for the amount which such hospital was entitled
4 22 to receive as aforesaid; any such association, corporation, or
4 23 other institution maintaining such hospital may, within such
4 24 period, enforce its lien by a suit at law against such person
4 25 or persons, firm, or firms, corporation or corporations making
4 26 any such payment.
27	2.  Prior to payment by a person, firm, or corporation,
  4 28 including an insurance carrier, to a patient's attorney, the
  4 29 patient's attorney may notify the person, firm, or corporation
  4 30 that will be making the payment that the attorney agrees to
  4 31 assume responsibility for the satisfaction of some or all
  4 32 liens of which the person, firm, or attorney has received
  4 33 notice pursuant to section 582.2.  Upon receipt of such
  4 34 notification by the patient's attorney, such person, firm, or
  4 35 corporation shall provide the patient's attorney with copies
  5  1 of any lien notice relating to a hospital lien for which the
  5  2 attorney has agreed to assume responsibility and such person,
  5  3 firm, or corporation shall not thereafter be responsible to
  5  4 any hospital encompassed by such notification.  A patient's
  5  5 attorney who so notifies a person, firm, or corporation and
  5  6 who receives a copy of any lien notice encompassed by such
  5  7 notification from the person, firm, or corporation shall pay
  5  8 such hospital the amount to which the hospital is entitled
  5  9 pursuant to section 582.1 from the amount received from the
  5 10 person, firm, or corporation.  If there is a dispute
  5 11 concerning the amount owed to a hospital pursuant to section
  5 12 582.1, a patient's attorney shall hold in trust the maximum
  5 13 amount to which the hospital may be entitled pursuant to
  5 14 section 582.1 and may disburse any other amounts to the

  5 15 patient, attorney, or other persons entitled to the funds.
  5 16 Any dispute concerning the amount owed to a hospital pursuant
  5 17 to section 582.1 shall be resolved by the court in which the
  5 18 patient filed an action to recover for the patient's injury
  5 19 and the court shall retain jurisdiction of the case to resolve
  5 20 the amount of the lien after dismissal of the action.  If no
  5 21 such action was commenced by the patient, a court in which
  5 22 such action could have been brought shall have jurisdiction to
  5 23 determine the amount owed to the hospital.
5 24
5 25
5 26
27	JOHN P. KIBBIE
5 28	President of the Senate
5 29
5 30
5 31
5 32	PATRICK J. MURPHY
5 33	Speaker of the House
5 34
35	I hereby certify that this bill originated in the Senate and
1 is known as Senate File 546, Eighty=second General Assembly. 6	2
6	3
6	4
6	5	MICHAEL E. MARSHALL
6	6	Secretary of the Senate
6	7 Approved	, 2007
6	8
6	9
6 10  	
6 11 CHESTER J. CULVER
6 12 Governor