Bill Text: MS HB1413 | 2024 | Regular Session | Introduced
Bill Title: Insurers; require to exchange certain information with the MS Department of Human Services regarding delinquent child support.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2024-03-05 - Died In Committee [HB1413 Detail]
Download: Mississippi-2024-HB1413-Introduced.html
MISSISSIPPI LEGISLATURE
2024 Regular Session
To: Judiciary A
By: Representative Yancey
House Bill 1413
AN ACT TO CREATE NEW SECTION 43-19-50, MISSISSIPPI CODE OF 1972, TO REQUIRE INSURERS TO EXCHANGE CERTAIN INFORMATION WITH THE MISSISSIPPI DEPARTMENT OF HUMAN SERVICES FOR NONCUSTODIAL PARENTS DELINQUENT IN CHILD SUPPORT; TO PROVIDE THE REQUIREMENTS FOR INSURERS TO PARTICIPATE AND THEIR DUTIES; TO PROVIDE THE INFORMATION TO BE EXCHANGED; TO PROVIDE DEFINITIONS; TO PROVIDE PENALTIES FOR FAILURE TO COMPLY; TO BRING FORWARD SECTION 43-19-48, MISSISSIPPI CODE OF 1972, FOR THE PURPOSE OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. The following shall be codified as Section 43-19-50, Mississippi Code of 1972:
43-19-50. (1) Except as otherwise provided in subsection (10), each insurer or insurance company, as defined by Section 83-19-1 and 83-7-1 under the regulatory authority of the Mississippi Department of Insurance, shall exchange information with the Mississippi Department of Human Services (MDHS) in the manner prescribed by MDHS to verify whether the claimant owes debt for the support of one or more children not later than five (5) days after the opening of a claim which seeks an economic benefit for a claimant for Five Hundred Dollars ($500.00) or more. The obligation of an insurer to exchange information with MDHS shall be discharged upon complying with the requirements of this subsection.
(2) To the extent feasible, the MDHS shall facilitate a secure electronic process to exchange information with insurers and file liens and levies. When the operation of such data match system results in a match for a noncustodial parent who owes past-due support, or when a claim is located through any means, MDHS (a) shall have the authority to encumber and seize assets payable to an obligor, and (b) may request and shall receive additional financial or other information including account numbers, names and Social Security numbers on record for accounts, and account balances, from any insurer or insurance company needed to establish, modify, or enforce a support order. The insurer or insurance company shall not disclose to a claim holder, policy holder, or contract beneficiary that the name of such person has been received from or furnished to MDHS. The insurer or insurance company shall disclose to its account holders or its depositors that under the data match system, MDHS has the authority to request certain identifying information on the account holder's or the depositor's accounts.
(3) Notice of such encumbrance initiated by MDHS shall be provided to the insurer, insurance company or any applicable commission via electronic means, regular mail or as prescribed in Section 71-3-129. Notice shall be delivered to the obligor via regular mail at the current mailing address as recorded by MDHS at the commencement of the action described herein.
(4) Except as otherwise provided in subsection (8), if an insurer is notified by MDHS that a claimant owes debt for the support of one or more children, the insurer shall, upon receipt of a notice issued by the enforcing authority identifying the amount of debt owed:
(a) Not later than five (5) days after receiving notice from the enforcing authority, notify the claimant and his or her attorney, if known to the insurer, of the debt owed;
(b) Withhold from claim payments, awards, settlements or payments intended to prevent litigation, the amount specified in the notice; and
(c) Remit the amount withheld from payment to the enforcing authority within thirty (30) days.
(5) When an insurer withholds and remits any money to the enforcing authority pursuant to subsection (4), the insurer shall notify the claimant and his or her attorney, if known to the insurer, of that fact.
(6) Any amount encumbered and forwarded by the insurer or insurance company under this section shall not exceed the arrearage owed by the obligor.
(7) Priority over any withholding of payments pursuant to subsection (4) shall be given in the following order:
(a) Attorney's fees or costs incurred, if any, and
(b) Judgment, statutory or subrogation liens for medical expenses incurred as a result of the injury causing the claim.
(8) Any information obtained pursuant to this section shall be used only for the purpose of carrying out the provisions of this section. Notwithstanding the provisions of this subsection, an insurer or an insurance claim data collection organization approved by MDHS or other entity that performs the functions described in subsection (10) may not be held liable in any civil or criminal action under federal or state law for any act made in good faith pursuant to this section, including, without limitation:
(a) Any disclosure of information to the MDHS or the federal Office of Child Support Enforcement; or
(b) The withholding of any money from payment on a claim or the remittance of such money to the enforcing authority.
(9) For claims filed before the effective date of this act, an insurer shall not delay the disbursement of a payment on a claim to comply with the requirements of this section. An insurer is not required to comply with subsection (4) if the notice issued by the enforcing authority is received by the insurer after the insurer has disbursed the payment on the claim. In the case of a claim that will be paid through periodic payments, the insurer:
(a) Shall not be required to comply with the provisions of subsection (4) with regard to any payments disbursed to the claimant before the notice was received by the insurer; and
(b) Shall comply with the provisions of subsection (4) with regard to any payments on the claim scheduled to be made after the receipt of the notice.
(10) The insurer may comply with the requirements of this section by:
(a) Reporting directly to MDHS or its designee, or
(b) Authorizing the insurance claim data collection organization to provide claimant information to the federal Office of Child Support Enforcement of the United States Department of Health and Human Services.
(11) Failure to comply with the provisions of this section or the willful rendering of false information shall subject the insurer or insurance company to a fine of not less than One Thousand Dollars ($1,000.00).
(12) As used in this section, the following words and phrases shall have the meanings as defined in this subsection unless the context clearly indicates otherwise:
(a) "Economic benefit" means a payment in which an individual is paid directly by insurer as the payee or co-payee of a first-party or third-party claim; this term excludes claims for actual repair, replacement or loss of real or personal property; claims for reimbursement to a claimant for payments made by a claimant to a vendor or repair facility for the actual repair, replacement or loss of use of real or personal property; benefits payable for actual expenses to a funeral service provider or facility; medical payments coverage under a motor vehicle liability policy; benefits payable under a limited benefit insurance policy for coverage of specified diseases or illnesses, dental or vision benefits, or indemnity coverage; benefits paid in accordance with a long term care benefit plan; benefits paid on behalf of an individual directly to a retirement plan or an accelerated death benefit.
(b) "First party claim" means a claim made by the insured or policyholder under an insurance policy or contract or by a beneficiary.
(c) "Third-party claim" means a claim for bodily injury, property damage or other damages brought by a third party against an insured that is covered by a liability insurance policy or contract or by a self-insured.
(d) "Insurance claim data collection organization" means an organization that maintains a centralized database of information concerning insurance claims to assist insurers that subscribe to the database in processing claims and detecting and preventing fraud.
(e) "Insurer" means a person who holds a certificate of authority to transact insurance in this state.
SECTION 2. Section 43-19-48, Mississippi Code of 1972, is brought forward as follows:
43-19-48. (1) The Department of Human Services and financial institutions doing business in the state are required to enter into agreements:
(a) To develop and operate a data match system, using automated data exchanges, in which each such financial institution is required to provide for each calendar quarter the name, record address, social security number or other taxpayer identification number, and other identifying information for each noncustodial parent who maintains an account at such institution and who owes past-due support, as identified by the Department of Human Services by name and social security number or other taxpayer identification number;
(b) To encumber or surrender, as the case may be, assets held by such institution on behalf of any noncustodial parent who is subject to a child support lien; and
(c) To provide for payment of reasonable fees to financial institutions for conducting data matches, and for responding to other requests made pursuant to this section, with such fees not to exceed the actual costs incurred by such financial institutions.
(2) When the operation of such data match system results in the location of an account of a noncustodial parent who owes past-due support, or when such account is located through any means, the department may request and shall receive additional financial or other information including account numbers, names and social security numbers on record for accounts, and account balances, from any financial institution needed to establish, modify or enforce a support order.
(3) The department shall have the authority to encumber and seize assets held by an obligor in a financial institution doing business in Mississippi. Such assets shall be encumbered for either:
(a) A forty-five-day period; or
(b) Until such time as the issue of overdue support is resolved, provided the obligor has filed a petition for hearing with a court of appropriate jurisdiction and the financial institution receives written notice thereof from the department before the end of the said forty-five-day period.
(4) Notice of such encumbrance initiated by the department shall be provided to the financial institution and to the obligor:
(a) The department shall send, by certified mail, notice to the financial institution with which the account is placed, directing that the financial institution shall:
(i) Immediately encumber funds in any account(s) in which the obligor has an interest, and to the extent of the debt indicated in the notice from the department;
(ii) Forward the encumbered funds to the department after either the forty-five-day period stated in subsection 3(a) of this section, or a determination favorable to the department by a court of appropriate jurisdiction; or
(iii) In the event the obligor prevails before the court, immediately release said funds to the obligor.
(b) Notice shall be delivered to the obligor at the current mailing address as recorded by the department. Such notice shall be sent by regular mail at the commencement of the action described herein.
(c) The financial institution shall not disclose to an account holder or the depositor that the name of such person has been received from or furnished to the department. The financial institution shall disclose to its account holders or its depositors that under the data match system the department has the authority to request certain identifying information on the account holders' or the depositor's accounts.
(5) Challenges to encumbrance of an account:
(a) Challenges to such levy for child support arrearage may be initiated only by the obligor or by an account holder of interest.
(b) Challenges shall be made by the filing of a petition for hearing by the obligor in a court of appropriate jurisdiction under Rule 81(d)(2) of the Mississippi Rules of Civil Procedure. Service upon the department shall be as prescribed by Rule 4(d)(5) of the Mississippi Rules of Civil Procedure.
(c) Grounds for the petition challenging the encumbrance shall be limited to:
(i) Mistakes of identity; or
(ii) Mistakes in amount of overdue support.
(6) Liability of the financial institution and the department:
(a) Neither the department nor the financial institution shall be liable for any applicable early withdrawal penalties on the obligor's account(s).
(b) A financial institution shall be absolutely immune from any civil liability under any law or regulation to any person for the disclosure of or failure to disclose any information pursuant to this chapter or for the escrow, encumbrance, seizure or surrender of any assets held by the financial institution in response to any notice issued by the Department of Human Services, the Child Support Unit or any contractors or agents thereof unless the disclosure or failure to disclose was willful or intentional, or for any other action taken in good faith to comply with the requirements of this chapter.
(7) Any amount encumbered and forwarded by the financial institution under this section shall not exceed the arrearage owed by the obligor.
(8) The provisions herein and any other relevant sections shall be employed equally by authorized contractors of the department to collect delinquent support payments.
(9) A financial institution shall not be liable under federal or state law to any person:
(a) For any disclosure of information to the Department of Human Services;
(b) For encumbering or forwarding any assets held by such financial institution in response to a notice of lien or levy;
(c) For any other action taken in good faith to comply with the requirements of subsection (1)(a) or (b) above.
(10) Definitions. For purposes of this section:
(a) The term "financial institution" has the meaning given to such by Section 81-12-3, Mississippi Code of 1972, and shall include, but not be limited to, credit unions, stock brokerages, public or private entities administering retirement, savings, annuities, life insurance and/or pension funds;
(b) The term "account" means a demand deposit account, checking or negotiable withdrawal order account, savings account, time deposit account or money-market mutual fund account.
(11) Failure to comply with the provisions of this section or the willful rendering of false information shall subject the financial institution to a fine of not less than One Thousand Dollars ($1,000.00).
SECTION 3. This act shall take effect and be in force from and after July 1, 2024.
