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1570 Supplemental Security Income (SSI) for Children in Foster Care

CPS December 2011

Supplemental Security Income (SSI) benefits are based on financial need and disability. Benefits include monthly maintenance payments and Medicaid coverage. Children receiving SSI Medicaid are placed on a DFPS Foster Care related Medicaid  with Star Health coverage unless the child is in a placement that requires SSI Medicaid to cover the cost of care or to pay for the placement. This does not affect the SSI payment.

Regional SSI coordinators are responsible for applying for SSI benefits from the Social Security Administration (SSA) on behalf of children who appear to meet the necessary criteria for SSI eligibility. When these benefits are approved DFPS becomes the representative payee of the benefit. DFPS generally uses the benefit to offset the cost of the child’s foster care payment.

Children entering foster care may be receiving SSI or Retirement, Survivors and Disability Insurance (RSDI) benefits. The SSI coordinator is responsible for submitting a Representative Payee Application (SS-11) to SSA requesting that the agency be the representative payee of the child’s benefits. When SSA approves the payee change DFPS becomes the representative payee of the benefit. DFPS remains the representative payee of the benefit until managing conservatorship has ended. SSI coordinators consult with the state office Federal and State Support Division before allowing another entity to become the representative payee of a child’s benefit.

1571 Effect of SSI Eligibility on Title IV-E Foster Care

CPS December 2011

When an SSI coordinator has decided to apply for SSI benefits for a child who is eligible for Title IV-E assistance, the SSI coordinator submits a letter of intent to file an application to SSA and then contacts the regional foster care eligibility specialist informing him or her of the letter's submission. In IMPACT the specialist leaves the child’s Actual Eligibility as Title IV-E but changes the child’s Selected Eligibility to state-paid effective the first date of the month in which letter of intent was submitted to SSA. If the child’s SSI application is denied, the SSI coordinator notifies the eligibility specialist. In IMPACT the specialist changes the child’s Selected Eligibility to Title IV-E effective the first day of the month in which letter of intent was submitted to SSA.

The child’s service level affects the agency’s decision whether to continue receiving the child’s SSI benefit or claim Title IV-E funds for the child’s cost of care.

  •  If the child’s service level is Basic, the agency chooses to leave the child on SSI and change the child’s eligibility to state-paid eligible. In IMPACT the eligibility specialist keeps the child’s Actual Eligibility as Title IV-E but changes the child’s Selected Eligibility to state-paid.

  •  If the child’s service level is raised to Moderate or above, the agency chooses to keep the child Title IV-E eligible in lieu of receiving the SSI benefit. The SSI coordinator contacts SSA and requests the suspension of the child’s SSI benefits. In IMPACT the eligibility specialist keeps the child’s Actual Eligibility status as Title IV-E and changes the child’s Selected Eligibility status to Title IV-E. The effective date of the eligibility change is the first day of the month following the request to SSA to suspend benefits.

  •  If the child’s service level is later reduced to Basic, the eligibility specialist changes the child’s eligibility to state-paid and contacts the SSI coordinator to resume the child’s SSI benefits. The SSI coordinator contacts SSA and requests they resume the child’s SSI benefits. In this case the child’s Actual Eligibility status remains Title IV-E and the eligibility worker changes the child’s Selected Eligibility to state-paid effective the 1st day of the month in which SSA begins issuing the SSI benefit to the agency.

The table below illustrates this policy:

Child Eligible for IV-E and SSI

IMPACT Actual Eligibility Status

IMPACT Selected Eligibility Status

Foster Care Funding Source

Basic Service Level

IV-E

State-paid

SSI and State-paid

Moderate, Specialized, Intense Service Level

IV-E

IV-E

IV-E

1572 Effect of SSI Eligibility on State-Paid Foster Care

CPS December 2011

A child who receives SSI benefits is eligible for state-paid foster care if the cost of foster care exceeds the SSI payment and the child meets the eligibility requirements for state-paid foster care. The child’s state-paid foster care payments do not affect the child’s eligibility for SSI or the amount of SSI benefits a child receives.

1573 Effect of SSI Eligibility on MAO Foster Care

CPS December 2011

Children receiving SSI benefits must remain active on foster care Medicaid while they are in DFPS managing conservatorship. Situations may arise when it may be in the child’s best interest to discontinue foster care Medicaid and utilize the child's SSI Medicaid coverage instead. Utilizing the child's SSI Medicaid coverage might be needed to facilitate a placement or to provide the child access to other medical services. Staff obtain approval from the CPS State Office division administrator of the Federal and State Support Division before terminating the foster care Medicaid of any child in the conservatorship of DFPS.

1574 SSI Applications for Youth Aging Out of Care

CPS December 2011

SSA rules require each SSI recipient or potential recipient who is 18 years of age or older to be evaluated according to the adult listings of impairments. If a child has a significant disability and will require the appointment of a legal guardian, the CPS caseworker notifies the SSI coordinator when the child turns 17 years old. The SSI coordinator submits an SSI application on behalf of the child.

Although the child will be re-evaluated sometime after he or she turns 18 to determine whether the criteria of an adult with a disability are met, the medical evidence will already be on file with SSA when the child’s eligibility is established. For more information about a youth’s long-term care needs, see 10340 Preparation for Long-Term Care or Support in Adulthood for Youth with Disabilities.

State office sends a quarterly report to regional SSI coordinators identifying youth in foster care who are age 17 and who are potentially eligible for SSI. The regional SSI coordinators are responsible for submitting SSI applications for the identified youth regardless of eligibility for Title IV-E assistance. For more information about the report, see 1583.2 17-Year-Old SSI Report.

1575 Placement in Home and Community-Based Services (HCS) Homes

CPS December 2011

The HCS program provides individualized services and supports to persons with intellectual and developmental disabilities who are living with their family, in their own homes, or in other community settings, such as small group homes. In most cases, persons are placed on a waiting list to obtain HCS services since there are more individuals than Medicaid slots available.

Children eligible for an HCS waiver slot placement must have active Supplemental Security Income (SSI) eligibility before placement. When the child is placed the agency allows the HCS home provider to become the representative payee of the child’s SSI benefit. The HCS home provider utilizes the child’s SSI monthly benefit to pay for room and board. The CPS worker placing the child notifies the HCS provider of the need to become the child's representative payee for the child's SSI benefits. When the child is placed the worker records the child's HCS placement as a "Non-FPS Paid" placement type as the agency does not pay for the child's cost of care.

1575.1 SSI Coordinator and Foster Care Eligibility Specialist Responsibilities

CPS December 2011

The regional SSI coordinator and the foster care eligibility specialist have specific responsibilities to ensure the transition of:

  •  the representative payee of the child's SSI benefits from DFPS to the HCS provider occurs; and

  •  the child's foster care Medicaid coverage to an SSI Medicaid coverage before and after the HCS placement occurs.

When an HCS waiver slot is offered to a child, the regional developmental disability specialist (DDS) contacts the regional SSI coordinator. The SSI coordinator verifies whether the child's SSI benefits are active, suspended or denied. This may involve contacting their local SSA office.

Within three days of being contacted, the SSI coordinator notifies the DDS, the caseworker and the foster care eligibility specialist about the status of the benefits and if an application for SSI must be submitted. A pending SSI application must not prevent the caseworker from accepting an HCS waiver slot.

The SSI coordinator and the foster care eligibility specialist follow the procedures described in the applicable scenario below according the status of the child's SSI benefits.

1) SSI Benefits are Active

DFPS is receiving the child's monthly SSI benefit. The SSI coordinator informs the DDS, the caseworker and the foster care eligibility specialist that the SSI benefits are active and reminds the caseworker to contact the HCS provider to apply with SSA to be the child's representative payee of the SSI benefits after the placement is made.

When the child is subsequently placed with the HCS provider and the placement is recorded by the CPS worker as a "Non-FPS" paid placement, the foster care eligibility specialist receives a task to-do in IMPACT. When the to-do is received or if notified by the worker that the child has been placed in an HSC placement, the eligibility specialist:

  •  notifies the SSI coordinator about the placement;

  •  ends the child's foster care eligibility effective the date of placement, which sends a denial request to the HHSC TIERS system to end the child's foster care Medicaid and reinstate the SSI Medicaid; and

  •  within two to three days of ending eligibility, views the child's Medicaid History screen in TIERS to ensure the child's foster care Medicaid has a denial date.

  •  If the Foster Care Medicaid has a denial date, the specialist searches the HHSC SAVERR and TIERS systems to verify that the child's SSI Medicaid is active.

  •  If the SSI Medicaid is not active the specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to facilitate the reinstatement of the SSI Medicaid with HHSC.

  •  If the Foster Care Medicaid does not have a denial date, the eligibility specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to have the foster care Medicaid denied and to facilitate the reinstatement of the SSI Medicaid with HHSC.

When the SSI coordinator is contacted that the placement has been made, the SSI coordinator:

  •  contacts SSA to resign as representative payee for the child's SSI benefits and explains that the HCS provider will be applying to be the successor payee; and

  •  notifies the regional Children's Income Accounting (CIA) staff to return any SSI benefits received after the representative payee resignation occurred. Provided DFPS remains the managing conservator of the child, the child's conserved funds in a checking, savings or dedicated account will not be returned to SSA unless instructed by SSA.

2) SSI Benefits are Suspended

The child's SSI case is active but SSA is not issuing monthly benefits. The SSI coordinator:

  •  requests that SSA reinstate the child's SSI monthly benefits effective the following month;

  •  contacts the foster care eligibility specialist to change the child’s Selected Eligibility from Title IV-E to State-paid, if applicable, effective the first day of the following month;

  •  informs the DDS and the caseworker that the SSI benefits are being reinstated and reminds the caseworker to contact the HCS provider to apply with SSA to be the child's representative payee of the SSI benefits after the placement is made; and

  •  contacts the DDS, the caseworker and the foster care eligibility specialist when the award letter from SSA is received notifying them that the child's SSI benefits have been reinstated.

When the child is subsequently placed with the HCS provider and the placement is recorded by the CPS worker as a "Non-FPS" paid placement, the foster care eligibility specialist receives a task to-do in IMPACT. When the to-do is received or if notified by the worker that the child has been placed in the HSC placement, the eligibility specialist:

  •  notifies the SSI coordinator about the placement;

  •  ends the child's foster care eligibility effective the date of placement, which sends a denial request to the HHSC TIERS system to end the child's foster care Medicaid and reinstate the SSI Medicaid; and

  •  within two to three days of ending eligibility, views the child's Medicaid History screen in TIERS to ensure the child's foster care Medicaid has a denial date.

  •  If the Foster Care Medicaid has a denial date, the specialist searches the HHSC SAVERR and TIERS systems to verify that the child's SSI Medicaid is active.

  •  If the SSI Medicaid is not active the specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to facilitate the reinstatement of the SSI Medicaid with HHSC.

  •  If the foster care Medicaid does not have a denial date, the eligibility specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to have the foster care Medicaid denied and to facilitate the reinstatement of the SSI Medicaid with HHSC.

When the SSI coordinator is contacted that the placement has been made, the SSI coordinator:

  •  contacts SSA to resign as representative payee for the child's SSI benefits and explains that the HCS provider will be applying to be the successor payee; and

  •  notifies the regional Children's Income Accounting (CIA) staff to return any SSI benefits received after the representative payee resignation occurred. Provided DFPS remains the managing conservator of the child, the child's conserved funds in a checking, savings or dedicated account will not be returned to SSA unless instructed by SSA.

3) SSI Benefits are Denied

The child never had SSI or the child's SSI benefits were previously suspended by DFPS and SSA decides that submission of a new SSI application is required to reinstate the SSI benefits. The SSI coordinator:

  •  responds to the DDS, the caseworker, and the foster care eligibility specialist that the child doesn't have SSI eligibility and that an application for SSI benefits will be submitted;

  •  requests a protective filing date from SSA as notice of intent to file an application for SSI;

  •  contacts the foster care eligibility specialist to change the child’s Selected Eligibility from Title IV-E to State-paid effective the first day of the month in which the protective filing date request is sent to SSA, if applicable;

  •  submits a full application for SSI to SSA within 60 days of requesting the protective filing date; and

  •  contacts the DDS, the caseworker and the foster care eligibility specialist when the child's SSI benefits have been approved and reminds the caseworker to contact the HCS provider to apply with SSA to be the child's representative payee of the SSI benefits after the placement is made.

SSI Approved Before HCS Placement

When the child is subsequently placed with the HCS provider and the placement is recorded by the CPS worker as a "Non-FPS" paid placement, the foster care eligibility specialist receives a task to-do in IMPACT. When the to-do is received or if notified by the worker that the child has been placed in the HSC placement, the eligibility specialist:

  •  notifies the SSI coordinator who will resign as representative payee of the SSI benefits;

  •  ends the child's foster care eligibility effective the date of placement, which sends a denial request to the HHSC TIERS system to end the child's foster care Medicaid and reinstate the SSI Medicaid; and

  •  within two to three days of ending eligibility, views the child's Medicaid History screen on in TIERS to ensure the child's foster care Medicaid has a denial date.

  •  If the Foster Care Medicaid has a denial date, the specialist searches the HHSC SAVERR and TIERS systems to verify that the child's SSI Medicaid is active.

  •  If the SSI Medicaid is not active the specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to facilitate the reinstatement of the SSI Medicaid with HHSC.

  •  If the Foster Care Medicaid does not have a denial date, the eligibility specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to have the FOSTER CARE Medicaid denied and to facilitate the reinstatement of the SSI Medicaid with HHSC.

If the SSI Medicaid cannot be reinstated by HHSC the "DFPS FC-ADO Medicaid Exceptions" mailbox notifies the eligibility specialist. When this occurs the eligibility specialist contacts the CPS worker to ask the HCS provider to inquire with SSA about reinstating the child's SSI Medicaid.

SSI Approved After HCS Placement

In situations where the child is placed with the HCS provider prior to the approval of SSI application or if an SSI application had not been submitted, DFPS continues the child's Foster Care Medicaid coverage. In these situations the eligibility specialist:

  •  changes the child's Selected Eligibility to MAO effective the date of the placement with the HCS provider if the child is under age 18; or

  •  ends the child's foster care eligibility effective the date of the placement with the HCS provider if the child is age 18 or older; and

  •  notifies the SSI coordinator about the child's placement.

The SSI coordinator contacts the CPS state office SSI program specialist for consultation.

When the child's SSI is subsequently approved, the SSI coordinator:

  •  notifies the CPS caseworker, the DDS, and the foster care eligibility specialist and reminds the caseworker to contact the HCS provider to apply with SSA to be the child's representative payee of the SSI benefits;

  •  contacts SSA to resign as representative payee for the child's SSI benefits and explains that the HCS provider will be applying to be the successor payee; and

  •  notifies the regional Children's Income Accounting (CIA) staff to return any SSI benefits received after the representative payee resignation occurred. Provided DFPS remains the managing conservator of the child, the child's conserved funds in a checking, savings or dedicated account will not be returned to SSA unless instructed by SSA.

When notified that the child's SSI has been approved, the foster eligibility specialist:

  •  ends the child's foster care eligibility, effective the date notice from the SSI coordinator, which sends a denial request to the HHSC TIERS system to end the child's Foster Care Medicaid and reinstate the SSI Medicaid; and

  •  within two to three days of ending eligibility, views the child's Medicaid History screen in TIERS to ensure the child's Foster Care Medicaid has a denial date.

  •  If the Foster Care Medicaid has a denial date, the specialist searches the HHSC SAVERR and TIERS systems to verify that the child's SSI Medicaid is active.

  •  If the SSI Medicaid is not active the specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to facilitate the reinstatement of the SSI Medicaid with HHSC.

  •  If the Foster Care Medicaid does not have a denial date, the eligibility specialist sends a request to the "DFPS FC-ADO Medicaid Exceptions" mailbox to have the Foster Care Medicaid denied and to facilitate the reinstatement of the SSI Medicaid with HHSC.

If the SSI Medicaid cannot be reinstated by HHSC the "DFPS FC-ADO Medicaid Exceptions" mailbox notifies the eligibility specialist. When this occurs the eligibility specialist contacts the CPS worker to ask the HCS provider to inquire with SSA about reinstating the child's SSI Medicaid.

See policy at 4221 Home and Community-Based Services (HCS) Program for more information about HCS placements.

1576 Child Specific Contract Placements

CPS December 2011

In rare instances DFPS may enter into a child specific contract (CSC) with a provider for the care of a child, including HCS home providers. The child’s Actual Eligibility and Selected Eligibility types affect how the agency handles the child’s SSI benefits while placed in the CSC placement.

  •  If the child's Actual Eligibility type is state-paid then the agency continues to receive the child’s SSI benefit and uses it to offset the cost of the child’s foster care payment.

  •  If the child's Actual Eligibility type is Title IV-E, then the child’s SSI benefit and Selected Eligibility are handled as follows:

  •  If the CSC contract utilizes a DFPS scheduled rate, or if the placement is not court-ordered, Title IV-E benefits can be used to pay the cost of care. The foster care eligibility specialist ensures the child’s Selected Eligibility is Title IV-E while in the CSC placement. The SSI coordinator notifies SSA to suspend the child’s SSI monthly benefits.

  •  If the CSC contract utilizes a DFPS unscheduled rate, or if the placement is court-ordered, Title IV-E benefits cannot be used to pay the cost of care. The foster care eligibility specialist ensures the child’s Selected Eligibility is state-paid while in the CSC placement. The agency continues to receive the child’s SSI monthly benefit and uses it to offset the cost of foster care.

1577 Establishing a Dedicated Account Using a Supplemental Security Income (SSI) Lump Sum

CPS December 2011

Dedicated Accounts

Federal law requires that an SSI lump sum award that exceeds six times the current Federal Benefit Rate is to be placed in a “dedicated account.” Dedicated accounts are not regarded as a resource under Social Security Administration (SSA) rules. Dedicated accounts are excluded from the resource limits for both Title IV-E and state-paid foster care and Medicaid.

SSA determines when an award requires a dedicated account and notifies the representative payee. The regional SSI coordinator serves as the region’s point of contact for facilitating the establishment of a dedicated account.

SSI awards that do not exceed six times the current Federal Benefit Rate are handled in accordance with 1581 Managing a Supplemental Security Income (SSI) Lump Sum.

Other Types of Lump Sums

The requirement for a dedicated account applies only to SSI lump sums. No other type of lump sum award may be commingled with the SSI lump sum in the dedicated account. Other types of federal benefits such as Retirement, Survivor, Disability Insurance (RSDI) or Veteran's Administration (VA) benefits, or any other types of benefits that may be awarded in a lump sum should be handled according to 1582 Managing a Non SSI (Supplemental Security Income) Lump Sum.

Establishing a Dedicated Account

The following procedures are used to establish a dedicated account:

  •  The regional SSI coordinator receives an award letter from SSA naming the child and the amount of the award, and stating that a dedicated account is required.

  •  The regional SSI coordinator e-mails the state office SSI program specialist to request that a dedicated account be established and sends the program specialist a copy of the award letter.

  •  The SSI program specialist forwards the request to state office accounting. State office accounting submits the required documentation to the bank to open a dedicated account.

  •  Once the account is established, state office accounting sends the account number to the program specialist. The program specialist forwards the account information, including the bank routing number, to the SSI coordinator.

  •  The SSI coordinator sends the account number and bank routing number to the SSA office that sent the award letter.

  •  The SSI coordinator notifies the regional Children’s Income Account (CIA) accountant that a dedicated account has been established. The CIA accountant checks the dedicated account indicator box in IMPACT located on the child’s checking account page.

  •  The SSA deposits the award via wire transfer to the account.

  •  For large award amounts, SSA may deposit the award in installments. The award letter indicates the total amount of the award and the amount of the first installment. The SSI coordinator receives a notice when each installment is made and sends a copy to the SSI program specialist who forwards a copy to state office accounting.

  •  If SSA inadvertently issues a lump sum award in excess of the amount requiring a dedicated account without requesting that a dedicated account be established, the SSI coordinator consults with the SSI program specialist.

How to Request and Process Expenditures

Expenditures from the dedicated account can be made only with SSA approval and must be related to the child’s impairment. Requests for expenditures are made by the CPS caseworker who sends the request to the regional SSI coordinator. The request includes a cost estimate or invoice showing the cost of the item or service to be purchased. The SSI coordinator sends the CPS supervisor, the program director, and the regional developmental disability specialist, if appropriate, an e-mail asking for approval of the expenditure.

If the request is approved, the SSI coordinator contacts the local SSA office to obtain approval from SSA. If the item is approved by SSA, the SSI coordinator notifies the SSI program specialist in state office and includes the cost estimate or invoice for the item or service and vendor information where the item or service will be purchased. If the approval by SSA is in writing, the approval is sent to the SSI program specialist as well.

The SSI program specialist has a check issued payable to the vendor indicated by the SSI coordinator, the check is sent by overnight mail to the SSI coordinator. The SSI coordinator forwards it to the caseworker, or to whoever will be paying the designated vendor of the approved goods or services. For audit purposes, copies of all receipts for purchases must be maintained in the child’s financial record in the Children's Income Accounting unit.

Closing a Dedicated Account

Unless directed by SSA to return the dedicated account funds, DFPS maintains the child’s dedicated account as long as the agency is the representative payee of the child’s SSI benefits or if the youth enters extended foster care. Dedicated account funds are always returned to SSA directly and never forwarded to the beneficiary or a subsequent representative payee. See 1562 Handling Deceased Children’s Income for handling the dedicated account funds for children who die while in DFPS managing conservatorship.

The following are procedures to close a dedicated account:

  •  The SSI coordinator informs the local SSA that DFPS is no longer the managing conservator of the child, or that the youth is 18 and has left CPS care. The SSI coordinator provides SSA with the name and address of the individuals with whom the child currently resides.

  •  The SSI coordinator notifies the local SSA that DFPS will be returning the balance of funds remaining in the dedicated account for the child to SSA. The SSI coordinator obtains the name and address of the SSA staff to send the money via certified mail.

  •  The SSI coordinator provides the SSI program specialist with an e-mail containing:

  •  the child’s name, Social Security number (SSN), and date of birth (DOB);

  •  the date DFPS conservatorship was terminated;

  •  the name, relationship, address, and phone number of the person with whom the child currently resides; and

  •  the name and address of the SSA contact to whom the conserved funds are sent via certified mail.

  •  The SSI program specialist contacts state office accounting to request closure of the account and for the bank to issue a check of the account balance.

  •  Once the check is received the SSI program specialist sends a letter and the check via certified mail to the SSA contact identified by the SSI coordinator. The program specialist sends a copy of the letter to the SSI coordinator.

  •  The SSI coordinator notifies the regional Children’s Income Account (CIA) accountant that a dedicated account has been closed. The CIA accountant unchecks the dedicated account indicator box in IMPACT that is located on the child’s checking account page.

1578 Money Earned by Foster Children From Full- or Part-Time Employment

CPS December 2011

Personal Bank Accounts

A child in foster care who earns income from full- or part-time employment is entitled to keep any money earned. The child may also deposit the money in a personal bank or savings account for the child’s own use before or after leaving foster care. The child has the sole responsibility of the control and management of the account subject to §34.305 of the Texas Finance Code. The child is the owner of the account and retains ownership even when he or she returns home. DFPS is not involved in the management of these personal accounts. These accounts are separate from any DFPS savings account that DFPS may have opened for the benefit of the child.

Texas Family Code §264.0111

Income and Resources

Any money DFPS or the child places in a bank account is considered a resource and may affect the child’s eligibility for Supplemental Security Income (SSI) benefits. For any child receiving SSI benefits who is working, the child’s caseworker reports the earnings and the balance of any funds in the child’s personal bank account to the SSI coordinator. The SSI coordinator reports earning information to the Social Security Administration and determines if the money in the child’s personal savings account affects the child’s eligibility for SSI.

If the child’s resources exceed the allowable $2,000 limit for SSI eligibility, the eligibility worker immediately notifies the child’s caseworker. The child’s caseworker then ensures that the child’s resources are appropriately spent to a point where the resources are under the allowable $2,000 limit.

1579 Third Party Resources for Medical Care Services

CPS November 2014

Third party payers are entities or individuals that are legally responsible for paying the medical claims of Medicaid recipients. As a condition of eligibility, Medicaid recipients assign their rights to medical support and payment for medical care from any third party to Medicaid.

Pursuant to federal and state law, the Medicaid program, by law, is the payer of last resort. This means all other available third party liability (TPL) resources must meet their legal obligation to pay claims before the Medicaid program pays for the care of an individual eligible for Medicaid.

DFPS Rules, 1 TAC §§354.2311, 354.2313

1579.1 Third Party Payors

CPS November 2014

A third party payor is any individual, entity, or program that is, or may be, liable to pay for any medical assistance provided to a recipient under the approved state Medicaid plan. The most common sources of third party resources which may be available to children covered by Medicaid include:

  •   group medical insurance provided through a parent’s employment;

  •   private medical insurance paid for by the child’s parents or other relatives;

  •   TRICARE, formerly known as the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS), is a health care program of the United States Department of Defense Military Health System. TRICARE provides civilian health benefits for military personnel, military retirees, and their dependents, including some members of the Reserve Component. The TRICARE program is managed by TRICARE Management Activity (TMA) under the authority of the assistant secretary of defense (Health Affairs). TRICARE is the civilian component of the Military Health System, although historically it also included health care delivered in the military medical treatment facilities;

  •   direct medical providers who provide medical services at no cost to the child such as military and public health clinics;

  •   liability and casualty insurance and court settlements. Usual sources of payment for medical expenses or accidental injury situations are: automobile insurance; homeowners insurance; landlord and tenant insurance; products liability insurance; medical malpractice insurance; workman’s compensation; and lawsuit settlements, both criminal and civil; and

  •   wills and estates. Instructions in a will or estate may direct that proceeds of the estate be used to provide or reimburse for medical care provided on behalf of a Medicaid eligible child.

1579.2 Reporting Third Party Payors

CPS November 2014

Staff uses the following procedures for reporting and using third-party resources for children certified for Medicaid through foster care and Medicaid through the Title IV-E or state-paid adoption subsidy program.

Health Insurance:

  •   The worker must determine whether third-party resources are available. The worker must ask the child’s parents or caretakers if the child has any medical coverage provided through individual, group, or governmental health insurance. The worker or adoptive parent reports insurance coverage on Form 2200, Foster Care Assistance Application and Review, or Form 2250, Adoption Assistance Application.

  •   The worker notifies the parent or other policyholder that when the child needs medical care, DFPS will ask the medical provider to file for benefits from insurance before filing for Medicaid. The worker informs the policyholder to report any changes in insurance coverage to the worker.

  •   Staff must report insurance coverage of medical assistance clients to:

      Texas Medicaid & Healthcare Partnership
TPL Department
PO Box 202948
Austin, TX 78720-2948
1-800-846-7307
Fax to (512) 514‑4225

  •   Staff uses Form 1039-A/B, Medical Insurance Input, to report the coverage. For foster children, the foster care eligibility determination worker reports the coverage. For Title IV-E and state-paid adoption subsidy clients, the adoption subsidy eligibility specialist reports the coverage. The child’s worker or the adoptive parent must tell the medical provider about available insurance coverage other than Medicaid.

Liability Insurance:

HHSC’s contractor does not engage in cost recovery actions or pursue recovery by subrogation when a foster care child receiving Medicaid is injured in an accident involving a liable third party. The contractor does not take action due to the possibility that confidential information could be released resulting in safety issues for the child. Therefore, DFPS does not report information concerning accidents to the contractor or HHSC. However, upon request by a court or the plaintiff attorney representing the child in a suit against a third party, DFPS will assist to the extent it is capable in the reimbursement process. For example, contacting HHSC for the specific amount owed to Medicaid.

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