Print Friendly HOUSE BILL NO. 633 – Health insurance claim payments
HOUSE BILL NO. 633
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HEALTH INSURANCE - CLAIM PAYMENTS - Adds to existing law to govern the
timing of health insurance claim payments; to govern provider billing and
assignment of payments; to provide for the payment of interest; to provide
exceptions; and to provide for enforcement.
02/12 House intro - 1st rdg - to printing
02/13 Rpt prt - to Bus
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature Second Regular Session - 2002
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 633
BY BUSINESS COMMITTEE
1 AN ACT
2 RELATING TO PROMPT PAYMENT OF HEALTH CARE INSURANCE CLAIMS; AMENDING TITLE 41,
3 IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 56, TITLE 41, IDAHO CODE, TO
4 DEFINE TERMS, TO GOVERN TIMING OF CLAIM PAYMENTS, TO GOVERN PROVIDER BILL-
5 ING, TO GOVERN ASSIGNMENT OF PAYMENTS, TO PROVIDE FOR PAYMENT OF INTEREST,
6 TO PROVIDE EXCEPTIONS AND TO PROVIDE FOR ENFORCEMENT; PROVIDING AN EFFEC-
7 TIVE DATE AND TO PROVIDE FOR APPLICATION.
8 Be It Enacted by the Legislature of the State of Idaho:
9 SECTION 1. That Title 41, Idaho Code, be, and the same is hereby amended
10 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
11 ter 56, Title 41, Idaho Code, and to read as follows:
12 CHAPTER 56
13 PAYMENT OF CLAIMS
14 41-5601. DEFINITIONS. As used in this chapter:
15 (1) "Beneficiary" means a policyholder, subscriber, member, employer or
16 other person who is eligible for benefits under a contract providing hospital,
17 surgical, or medical expense coverage or a managed care organization or other
18 policy or agreement under which a third party payor agrees to reimburse for
19 covered health care services rendered to beneficiaries in accordance with the
20 benefits contract.
21 (2) "Clean claim" is as defined by the provisions of the contract between
22 the insurer and the provider.
23 (3) "Date of payment" means the date the payment is sent by the insurer
24 to the provider or to the beneficiary in the event there is no contract for
25 direct payment by the insurer to the provider.
26 (4) "Insurer" means an authorized insurer, as defined in section 41-110,
27 Idaho Code, that issues health insurance policies to any person within this
29 (5) "Provider" means a physician licensed to practice medicine pursuant
30 to Idaho law.
31 (6) "Receipt of claim" means the date the claim is actually received by
32 the insurer from the provider or the beneficiary.
33 41-5602. TIMING OF CLAIM PAYMENTS. (1) Unless otherwise provided in this
34 chapter, an insurer shall process a clean claim for payment for health care
35 services rendered by a provider to a beneficiary in accordance with this sec-
37 (2) An insurer shall pay or deny a clean claim not later than forty-five
38 (45) days after receipt of the claim.
39 (3) If an insurer denies the claim or needs additional information to
40 process the claim, the insurer shall notify the provider and the beneficiary
41 in writing. The notice shall state why the insurer denied the claim. If the
1 claim was denied because more information is required to process the claim,
2 the notice shall state that more information or supporting documentation is
3 needed to evaluate the claim for processing.
4 (4) Insurers and providers shall, in connection with all claims, use the
5 most current CPT code in effect, as published by the American medical associa-
6 tion, the most current ICD-9 code in effect, as published by the United States
7 department of health and human services, or the most current HCPCS code in
8 effect, as published by the United States health care financing administra-
9 tion. The provider shall submit the claim, either in paper or electronic
10 format, on the current UB-92 or HCFA-1500 claim form or a successor or equiva-
11 lent claim form as adopted by the national uniform billing committee (NUBC).
12 41-5603. PROVIDER BILLING. (1) The provider shall not send a bill to a
13 beneficiary until the time period for payment of a clean claim by the insurer,
14 as set forth in this section, has expired. The provider shall be permitted to
15 send a bill to the beneficiary for payment of any applicable copayment, coin-
16 surance or deductible prior to the expiration of the time period for payment
17 of a clean claim as set forth in this chapter.
18 (2) The provider may send an informational statement to the beneficiary
19 setting forth the charges for the services rendered. Any such statement shall
20 include language informing the beneficiary that the provider has submitted the
21 claim to the beneficiary's insurer for payment and that the beneficiary is not
22 required to submit payment, except for any applicable copayment, coinsurance
23 or deductible, to the provider until the insurer has met the requirements of
24 this chapter.
25 41-5604. ASSIGNMENT. Nothing in this section requires an insurer to
26 accept an assignment of payment by the beneficiary to a provider.
27 41-5605. INTEREST PAYMENTS. An insurer that fails to pay a claim to a
28 provider within the time periods established in this chapter shall pay inter-
29 est at the contract statutory rate pursuant to section 28-22-104, Idaho Code,
30 on the unpaid amount of a claim that is due and owing. The interest shall
31 accrue from the date payment was due, pursuant to the provisions of this chap-
32 ter, until the claim is processed. Payment of any interest amount of less than
33 five dollars ($5.00) shall not be required.
34 41-5606. EXCEPTIONS. The time periods set forth in this chapter shall not
35 apply to claims for which there is evidence of fraud, or misrepresentation by
36 a provider or beneficiary, or to instances where the insurer has not been
37 granted reasonable access to the information under the provider's control. An
38 insurer is not required to comply with the time periods set forth in this
39 chapter if the failure to comply is due to an act of God, bankruptcy, an act
40 of a governmental authority responding to an act of God or emergency, or the
41 result of a strike, walkout or other labor dispute.
42 41-5607. ENFORCEMENT. The director of the department of insurance shall
43 enforce the provisions of this chapter. The director shall review and investi-
44 gate all complaints received by the department related to noncompliance by an
45 insurer or provider with the provisions of this chapter. The department will
46 resolve complaints pursuant to the Idaho administrative procedure act, chapter
47 52, title 67, Idaho Code. The director may impose an administrative fine not
48 to exceed five hundred dollars ($500) for a single violation of this chapter
49 and not to exceed five thousand dollars ($5,000) in the aggregate for multiple
50 violations of this chapter. The director shall deduct any interest paid by an
1 insurer pursuant to section 41-5605, Idaho Code, from any administrative fine
2 that is imposed upon an insurer. The director shall not suspend, revoke or
3 refuse to continue an insurer's certificate of authority for a violation of
4 this chapter. The director shall not suspend, revoke or otherwise limit a
5 physician's license to practice medicine for a violation of this chapter. Any
6 administrative fine imposed by the director pursuant to this chapter shall be
7 deposited in the account for the individual high-risk reinsurance pool created
8 in section 41-5502, Idaho Code.
9 SECTION 2. This act shall be in full force and effect for those claims
10 with a date of service by a provider on and after July 1, 2003.
STATEMENT OF PURPOSE
This legislation requires prompt payment by health insurance
carriers of claims submitted by contracting physicians.
It allows contracting physicians to send the patient an
informational statement setting forth the fees for services, but
prohibits the physician from seeking immediate payment except for
applicable coinsurance, deductibles and co-payments.
It requires a health insurance carrier to pay the provider
the statutory contract rate of interest for claims not paid within
the proper time frame. It provides the Department of Insurance
authority to impose administrative fines on either health insurance
carriers or physicians for violation of this provision.
There may be a fiscal impact to the Department of Insurance
for the cost of any enforcement actions.
Steve Tobiason, Idaho Association of Health Plans 342-4545
Lyn Darrington 333-7818
STATEMENT OF PURPOSE/FISCAL NOTE H 633