THE ATTORNEY GENERAL
OF TEXAS
September 7, 1989
JlX Mxl"roX
.%lTo*SEY G&SERAL.
Honorable John Owens Opinion No. JR-1094
Henderson County Attorney
Courthouse Re: Whether a county may re-
Athens, Texas 75751 cover expenses incurred under
the Indigent Health Care Act
(RQ-1522)
Dear Mr. Owens:
You ask about the authority of a county to seek reim-
bursement for money it has spent pursuant to the provisions
of the Indigent Health Care and Treatment Act, article
44381, V.T.C.S. You explain that Henderson County has spent
a large sum of money for medical treatment for a particular
individual. The individual has now filed a personal injury
action against a private individual, and you ask whether the
county may seek reimbursement if the individual receives a
settlement or judgment that covers his medical expenses.
The Indigent Health Care and Treatment Act requires a
county to pay for medical care for indigent residents of the
county who are not residents of a hospital district or the
area a public hospital has an obligation to serve. Id.
tit. 2. The act requires that the Department of Human
Services "establish eligibility standards and application,
documentation, and verification procedures for counties 'to
use in determining eligibility." & 5 1.06(a).
Nothing in the Indigent Health Care and Treatment Act
or the current regulations purports to place a lien on or
to provide for the assignment of any potential right of
recovery in a personal injury action. Cf. Hum. Res. Code
9 32.033 (filing of an application for receipt of medical
assistance constitutes an assignment of the applicant's
right of recovery from another person for personal injur
caused by the other person's negligence or wrong).?i
1. For examples from other jurisdictions of statutory
liens on or assignments of later-acquired property of
(Footnote Continued)
Honorable John Owens - Page 2 (JM-1094)
Indeed, nothing in the Indigent Health Care and Treatment
Act or current regulations would require an indigent to
report any unsettled tort claim on an application for
assistance under the Indigent Health Care and Treatment Act.
See a-nerallv 40 T.A.C. ss 14.104 and 14.105 (income and
resources standards under Indigent Health Care and Treatment
Act) .2
Although the act does not expressly provide for a lien
or an assignment in the context you ask about, it is clear
. that the legislature did not intend for counties to pay for
medical care when another source of payment exists. For
example, section 1.06(c)(5) requires that an applicant
provide information about "the existence of insurance
coverage or other hospital or health care benefits for which
the applicant is eligible." Also, section 2.02(b) of
article 4438f provides:
The county is the payor of last resort
and shall provide assistance only if other
adequate public or private sources of payment
are not available.
(Footnote Continued)
welfare recipients, see Conn. Gen. Stat. Ann. 55 17-83e,
17-83f (West 1988) (lien on later acquired prq;rty or
estate for AFDC or delinquent child support); . Ann.
Stat. ch. 23, para. 11-22 (Smith-Hurd 1988) (charge on
personal injury claims for repayment of public medical
assistance): Minn. Stat. Ann. 5 393.10 (West 1968 & Supp.
1989) (county lien on any cause of action o: 4rf;o;
furnished medical assistance): N.J. Stat. Ann. : -
(West Supp. 1988) (provision that application for AFDC
operates as assignment of other rights to support): N.Y.
Sot. Serv. Law 5 104-b (McKinney 1983) (lien on suit for
personal injury as repayment of public assistance): id.
8 366 (McKinney 1983 & Supp. 1988) (repayment of costs of
medical care and services): Pa. Stat. Ann. tit. 62 5 403
(Purdon Supp. 1988) (assignment of property rights to state
as prerequisite for public assistance).
2. The regulations of the Department of Human Services
list "lump-sum payments" as a type of resource. 40 T.A.C.
5 14.105(c)(ll). We think it is clear from the examples of
OOlump-sumpayments," however, that a V1lump-sumpayment" is a
payment the receipt of which is certain.
p. 5733
Honorable John Owens - Page 3 (JM-1094)
Section 2.03(a)(3) provides that a county has an obligation
to provide indigent health care only if 'no other adequate
source of payment exists." Also, a rule adopted by the
Department of Human Services provides that mandatory
services under the Indigent Health Care and Treatment Act do
not include services and supplies that:
are payable by or available under any health,
accident, or other insurance coverage; by
any private or other governmental benefit
systems; hv anv leaallv liable third nartv;
or under other contract. (Emphasis added.)
40 T.A.C. S 14.202(b)(7). All those provisions, however,
apply to sources of payment that "exist" or "are available"
or for which a third party is "legally liable." A potential
award in a personal injury suit does not yet exist and it is
therefore not available. Further, no legal liability has
been determined. Therefore, even though we think it is
clear that the‘ legislature would not have intended for an
indigent to be able to retain a windfall in the circum-
stances you ask about, we do not think the provisions cited
above cover a potential, rather than actual, right to
reimbursement. The question, then, is whether a lien on or
an assignment of a future personal injury recovery can be
implied from the provisions of the Indigent Health Care and
Treatment Act.
'I
It is the rule in Texas that a lien on personal pro-
'perty or real estate arises only by virtue of contract or
statutory provision. Ro*on v , Gibson, 274 S.W. 292, 293
(Tex. Civ. App. - Waco 1925, no writ): see also Johnson v.
Second Iniurv w, 688 S.W.2d 107, 108 (Tex. 1985) (right
of subrogation does not exist except where clearly mandated
by the legislature). Also, in 1961 this office considered
whether a county could acquire a lien on the real estate of
paupers for whom the county provided support. Attorney
General Opinion WW-1150 (1961). This office concluded that
a county could not acquire such a lien. The basis for that
conclusion was that a county has only those powers expressly
or impliedly conferred on them by the constitution or
statutes. S e aener lly Annot., Personal Injury Recovery as
Affecting Elzgibilitt for, or Duty to Reimburse, Public
Welfare Assistance, 80 A.L.R.3d 772 (1977). In light of
those authorities, we must conclude that under the current
statute and regulations, which make no provision for a lien
on or an assignment of a future personal injury recovery, a
county does not have a right to reimbursement in the context
you ask about.
p. 5734
Honorable John Owens - Page 4 (JM-1094)
-‘,
Although current Department of Human Services regula-
tions under the Indigent Health Care and Treatment Act do
not require an assignment in the context you ask about, we
do think that the Department of Human Services has authority
to promulgate a rule requiring that an applicant for county
as&stance under the Indigent Health Care and Treatment Act
assign any personal injury recovery or right to recovery for
medical expenses to the county, to the extent of the public
funds expended.
The department is required to set eligibility standards
and application procedures "in accordance with" department
rules relating to the AFDC-Medicaid program. V.T.C.S. art.
4438f, 5.1.06(a). Section 32.033 of the Human Resources
Code, which governs the Medicaid program, provides in part:
(a) The filing of an application for or
receipt of medical assistance constitutes an
assignment of the applicant's or recipient's
- right of recovery from:
(1) personal insurance;
(2) other sources; or
(3) another person for personal injury
caused by the other person's negligence or
wrong.
See also 40 T.A.C. 9 45.501 (rule restating provision set
out above). Because the department is authorized to adopt
regulations governing eligibility for and application for
indigent health care that are "in accordanceWq with the
department's standards and procedures for determining
eligibility in the AFDC-Medicaid program, we think it is
within the department's authority to adopt a rule under the
Indigent Health Care and Treatment Act that tracks the
Uedicaid rule set out in section 32.033 of the Human
Resources Code.
It has been suggested that individual counties have
independent authority to adopt such a rule under section
1.06(h) of the Indigent Health Care and Treatment Act, which
provides:
A county may use the standards and
;:,,;Fres established by *the department a;i
use less restrictive standards
procedures. A-.
p. 5735
Honorable John Owens - Page 5 (JM-1094)
See also V.T.C.S. art. 4438f, 9 2.04(b). Although that
provision allows a county to adopt its own standards and
procedures, it allows a county to do so only if the county's
own standards and procedures are less restrictive than those
of the Department of Human Services. In the absence of a
department regulation requiring assignment of potential
personal injury recoveries, a county would have no authority
to adopt such a requirement since such a requirement would
be more restrictive than the department's requirements.
SUMMARY
A county has no authority, under current
law, to seek reimbursement from an indigent
whose medical expenses are paid by the county
in accordance with the Indigent Health Care
and Treatment Act and who subsequently
recovers damages in a personal injury suit.
However, the Department of Human Services
does have authority under the Indigent Health
Care and Treatment Act to promulgate a rule
requiring that applicants for county assis-
tance under the Indigent Health Care and
-.. Treatment Act assign their rights to reim-
bursement from another person for personal
injury caused by the other personjs negli-
gence or wrong.
JIM MATTOX
Attorney General of Texas
MARY KELLER
First Assistant Attorney General
mu MCCREARY
Executive Assistant Attorney General
JUDGE ZOLLIE STEARLEY
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by Sarah Woelk
.- Assistant Attorney General
P. 5736