§ 994.3.Recovery Against Party that Received Payment - Third-Party Payer - Payments - Recovery Worksheet

Chapter 15: Appeal and Error · Not amended since adoption on record · Last verified August 3, 2026

In one sentenceSection 994.3 extends the same procurement-cost reduction formula from Medicaid recovery to any payor with contractual or statutory reimbursement rights, cutting what it can recover from a judgment or settlement by a proportional share of the costs the other party spent obtaining it.

Full Text of § 994.3

Text sizeJump to: (A) (B) (C) (D) (E) (F) (G)

A. Recovery against the party that received payment.

1. General rule. Any payor of money benefits with recovery or reimbursement rights by contract or statute reduces its recovery to take account of the cost of procuring the judgment or settlement from a third party, as provided in this section, if:

a. procurement costs are incurred because the claim is disputed, and

b. those costs are borne by the party against which the payor seeks to recover.

2. Special rule. If a payor must file suit because the party that received payment opposes the payor's recovery, the recovery amount is as set forth in subsection E of this section.

B. Recovery against the third-party payer. If the payor seeks recovery from the third-party payer, the recovery amount will be no greater than the amount determined under subsection C, D or E of this section.

C. Payments made by a payor that are less than the judgment or settlement amount. If a payor's payments are less than the judgment or settlement amount, the recovery is computed as follows:

1. Determine the ratio of the procurement costs to the total judgment or settlement payment;

2. Apply the ratio to the person or entity's payment. The product is the payor's share of procurement costs; and

3. Subtract the payor's share of procurement costs from his or her claimed payments. The remainder is the payor's recovery amount.

D. A payor's payments that equals or exceeds the judgment or settlement amount. If payor's payments equal or exceed the judgment or settlement amount, the recovery amount is the total judgment or settlement payment minus the total procurement costs.

E. The payor incurs procurement costs because of opposition to its recovery. If the payor must bring suit against the party that received payment because that party opposes the recovery, the recovery amount is the lower of the following:

1. The person or entity's payment; or

2. The total judgment or settlement amount, minus the party's total procurement cost.

F. Recovery worksheet. The amount to be recovered from the beneficiary is the amount payor paid, less a proportionate share of the costs of procuring the judgment or settlement. The amount to be refunded is determined as follows:

If the payor's payment is less than the amount of judgment or settlement:

1. Determine the ratio of the payments to the total amount of the judgment or settlement;

2. Apply this ratio to the costs of procuring the judgment or settlement, including attorney fees; and

3. Subtract the payor's share of procurement costs from their payments. The remainder is the amount of reimbursement to be refunded to the payor seeking recovery of payments.

Step 1:

$__________________ / $___________________ = ___________________

Payor's Payment Judgment/Settlement Ratio Carry out 6 digits

Step 2:

___________________ X $___________________ = ___________________

Ratio from Step 1 Carry out 6 Procurement Costs Payor's Share of Procurement digits Costs

Step 3:

$__________________ - $___________________ = ___________________

Payor's Payment Payor's Share of Procurement Refund to Payor Costs

G. If the payor's payments equal or exceed the amount of the judgment or settlement, subtract the total procurement costs from the judgment or settlement. The remainder is the amount of reimbursement to be refunded to the payor. The beneficiary will not be required to refund more than the liability insurance payment minus the procurement costs.

$__________________ - $___________________ = $__________________ Judgment/Settlement Procurement Costs Refund

End

Amendment History

Added by Laws 2023, c. 161, s. 2, eff. 11/1/2023.

Plain-English Summary

This section generalizes the formula Section 994.2 applies to Medicaid recovery, extending it to any payor of money benefits with a contractual or statutory right to recovery or reimbursement — a health insurer or other third-party payor, for instance — rather than the Oklahoma Health Care Authority alone. The reduction applies only when procurement costs were incurred because the claim was disputed and the party the payor seeks to recover from bore those costs.

The calculation mirrors Section 994.2's structure: if the payor's payment is less than the judgment or settlement, the recovery is the payment minus the payor's proportional share of procurement costs; if the payment equals or exceeds the recovery, the recovery is the total judgment or settlement minus the total procurement costs; and if the payor had to sue because the recipient opposed recovery, the recovery is capped at the lower of the payment or the recovery minus procurement costs. A worksheet in subsection F walks through the same math step by step.

Frequently Asked Questions

Does this section apply only to Medicaid recovery?

No — unlike Section 994.2, this section covers any payor of money benefits with a contractual or statutory right to recovery or reimbursement, not just the Oklahoma Health Care Authority.

When does the procurement-cost reduction apply?

Only when procurement costs were incurred because the claim was disputed and the party the payor seeks to recover from bore those costs.

How is the payor's recovery calculated if its payment is less than the settlement?

By determining the ratio of procurement costs to the total judgment or settlement, applying that ratio to the payor's payment, and subtracting the result from the payment.

What if the payor has to sue because the recipient opposes recovery?

Subsection E caps the recovery at the lower of the payor's payment or the total judgment or settlement minus that party's procurement costs.

Source & verification. Section text is reproduced verbatim from Title 12 of the Oklahoma Statutes, enacted by the Oklahoma Legislature. Last verified August 3, 2026. · Official source

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