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HB 1381

RELATING TO CHILD WELFARE SERVICES.

2025 Regular Session Introduced by Terez Amato and 17 co-sponsors

House Bill 1381 clarifies insurers' rights to recover up to $5,000 in medical costs from beneficiaries' third-party settlements, impacting beneficiaries and insurers alike.

Referred to HSH, JHA, FIN, referral sheet 4
#appropriation($) #childwelfaresystem #judiciary #workinggroup
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Bill Summary · HB 1381

Summary of House Bill 1381 (HB 1381)

Bill Information:
- Bill Number: HB 1381
- Title: Relating to Child Welfare Services
- Status: Referred to HSH, JHA, FIN, referral sheet 4
- Introduced: February 03, 2025
- Classification: Bill
- Subject: Appropriation ($), Child Welfare System, Judiciary, Working Group

Purpose and Intent

House Bill 1381 aims to address the rights of insurers regarding subrogation and reimbursement for medical and hospital benefits. The bill seeks to clarify the conditions under which insurers can recover costs when a beneficiary receives compensation from a third party for injuries sustained.

Key Provisions

  1. Limit on Applicability:

    • The bill limits its applicability to medical and hospital benefits that do not exceed $5,000 under Arkansas Code § 23-89-202(1).

  2. Insurer's Right of Reimbursement:

    • Insurers have the right to reimbursement from any tort recovery or settlement received by the beneficiary, minus the costs of collection.
    • Insurers will hold a lien on the recovery amount equivalent to the benefits paid.

  3. Subrogation Rights:

    • If a beneficiary does not pursue recovery from a liable third party, the insurer is granted the right of subrogation, allowing them to step into the beneficiary's shoes to recover costs.

  4. Cost of Collection:

    • The costs associated with the collection of the recovery will be divided proportionately between the insurer and the insured based on the benefits received.

  5. Settlement Conditions:

    • Insurers cannot condition the settlement or payment of a judgment on issuing a single check to both the injured party and the insurer.

  6. Common Law Doctrine:

    • The bill specifies that the common law doctrine requiring a party to be made whole before an insurer can be reimbursed does not apply under this section.

  7. Exclusions:

    • The provisions of this bill do not affect the rights and obligations under the Workers' Compensation Law.

Impact

  • Beneficiaries: Individuals receiving medical and hospital benefits under the specified code will be directly impacted, as their rights in recovery scenarios are clarified.
  • Insurers: Insurance companies will have clearer guidelines on their rights to reimbursement and subrogation, potentially affecting their financial operations and claims processes.
  • Legal and Judicial System: The bill may influence how tort claims are settled and how insurers interact with beneficiaries and third parties.

Procedural Timeline

  • February 03, 2025: Bill filed and read for the first time.
  • February 12, 2025: Bill withdrawn by the author.
  • Subsequent Actions: The bill was referred to multiple committees, including HSH, JHA, and FIN, for further consideration.

Related Legislation

  • SB 1228: A companion bill that may address similar issues or provide additional context to the provisions outlined in HB 1381.

This summary provides an overview of HB 1381, detailing its purpose, key provisions, and potential impacts on stakeholders within the child welfare and insurance sectors.

Compiled from official sources — confirm details with the bill’s official record.

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