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The Pennsylvania Department of Human Services (DHS) administers a Medical Assistance (MA) Program to provide health insurance benefits to eligible residents of Pennsylvania. While the MA Program is jointly funded with state and federal tax dollars, the DHS must ensure that Pennsylvania and the federal government do not pay for services when other coverage is or becomes available. Thus, any funds paid by the MA program when a responsible third party is liable for health care costs must be recovered.

These “third parties” subject to the mandatory recovery provisions include: (1) self-insured plans, (2) pharmacy benefits managers, and (3) “other parties that are, by statute, contract, or agreement, legally responsible for payment of a claim for a health care item or service” such as workers’ compensation, automobile insurance, liability insurance plans, and managed care organizations. To comply with this mandate, DHS created the Third Party Liability (TPL) Program.

When a third party reimburses a provider in part or in full for claims paid by the MA program, the state’s MA program must be reimbursed. Because of the federal mandate, TPL identifies and pursues responsible third parties for reimbursement to the DHS.