Arizona ruling allows hospital liens in some Medicaid cases

The Arizona Supreme Court says hospitals can go after lawsuit settlements to get additional reimbursement for costs of providing care for some patients covered by the state’s Medicaid program.

The court says hospitals can’t be sued for recording and enforcing liens on settlements won by patients if the patients reached agreements with hospitals to pay negotiated amounts so hospitals would release their liens.

The court’s unanimous ruling acknowledges that federal law prohibits so-called “balance billing” against Medicaid patients and that some courts have ruled that the prohibition applies to settlement proceeds.

But the Arizona ruling says that doesn’t matter when patients and hospitals negotiated agreements.

The decision leaves undecided whether hospitals can be sued over liens on settlements won by patients who didn’t negotiate agreements with hospitals.

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