On Tuesday, March 12, 2019, a three-judge panel of the Arizona Appeals Court held that Arizona statutes that allowed hospitals to impose liens on Arizona Medicaid recipients who suffered accidents in order to recover the difference between the Medicaid payments and the hospitals’ costs violated Federal law. 

The case is Ansley vs. Banner Health Network and the federal regulation found to being violated is 42 CFR section 447.15.

The court made it clear that pursuant to the federal regulation the hospitals could not engage in “balance billing” by going after amounts that were not paid by the state Medicaid agency.  However, the court stated that the prohibition did not bar the Medicaid agency from filing a lien against a third party who caused the incident to recover the money paid for the beneficiary’s care.