States must seek reimbursement from liable third parties for Medicaid benefits paid. Recovery is limited to the portion of a settlement attributable to medical expenses under Ahlborn and Wos.

Allocation determines the recoverable amount.

Alternative Names:

Medicaid Recovery, State Medicaid Lien

Why it Matters?

The medical expense limitation is the substantive protection, since a state cannot reach the portion of a recovery allocated to pain and suffering or lost wages. Where a settlement is undifferentiated the allocation becomes the dispute, and obtaining a court-approved allocation or a stipulation reflecting the actual claim composition is what limits the recovery. Failing to address allocation invites the agency to assert a claim against the entire proceeds.

Frequently asked questions

Can Medicaid reach the entire settlement?

How is allocation established?