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Attention to all Kansas school districts, KDOT, public hospitals, county and city employees who have ever been injured by another person that resulted in medical treatment.

On Friday January 5, 2024, the Kansas Supreme Court handed down the decision of Towne v. U.S.D. 259 et. al. The Court held that a municipality that self-insures its health care plan cannot demand that its employee insured repay the municipality any money that the plan paid to treat the injuries that its employee insured suffered when another person’s actions caused the injuries.
Case Background

In Kansas, a municipality includes every governmental entity except for the State of Kansas such as cities, counties, school districts, county owned hospitals, townships. There are two types of self-funded municipal health care plans -

  1. A single self-funded health care plan, like USD 259 self-funded health care plan;
  2. A municipal group-funded health care pool–a group-funded municipal plan requires 5 or more municipalities.

In Kansas, there is a regulation that prohibits health insurance companies from demanding that their insureds repay the medical expenses that the insurance company paid because its insured was injured by someone else negligence–like a car wreck. This demand is called subrogation.

Until 2013, this regulation was limited to health insurance companies. The municipal self-funded and group-funded both argued that they were not “insurance companies” so the anti-subrogation regulation did not apply to them. In 1996, the Kansas Court of Appeals agreed with the municipal self-funded and group-funded--both continued to demand that their insureds repay them for any expenses that they paid for because their insured was injured by the negligence of a third party. The municipal self-funded and group-funded health care plans were the only two Kansas health care plans that were allowed to subrogate.

An example of how the subrogation worked. Insured’s car gets hit by a drunken driver and insured suffers a significant injury. The health plan pays $20,000 of the insured’s medical expenses. The insured settles his case. From his settlement, he has to repay the health care plan the $20,000.

In 2013, the Kansas Legislature expanded the anti-subrogation regulation to include those health care plans that were excluded from the regulation by technicality. Despite this expansion, the municipal self-funded and group-funded continued to subrogate.

Troy Gott worked tirelessly on Mr. Towne’s case and this winning verdict could be an opportunity for you to recuperate money wrongly taken from you. He will work tirelessly for you.
Call Troy at 316-682-8500 or 800-829-5005

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