U.S. Supreme Court Hears Appeal in Region 8 Medicaid Case

FEBRUARY 28, 2006 - Posted at 7:54 a.m. CST

WASHINGTON (AP) - The U.S. Supreme Court is to decide by the summer an Arkansas appeal seeking full reimbursement of Medicaid costs from a legal settlement won by an Independence County woman injured in a traffic accident.

The court heard oral arguments yesterday.  It was the first time in 11 years that the state's attorney general's office argued a case before the nation's highest court.  That year, then-Attorney General Winston Bryant was unsuccessful in arguing term limits for Arkansas' congressional members.

In the current case, Lori Freno-Engman argued before the high court.

At issue is whether an Arkansas law requiring Medicaid applicants to assign their rights to any settlement to the state conflicts with federal laws that prohibit the state from putting liens on a person's property.

A federal appeals court says that $550,000 paid to Heidi Ahlborn of Newark in her lawsuit in a traffic accident was her property and the state could only claim a portion of it.  For Arkansas, that means recovering about $35,000 instead of $216,000 in Medicaid costs.

(Copyright 2006 by The Associated Press.  All Rights Reserved.)