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H0705...........................................................by BUSINESS HEALTH INSURANCE - CLAIMS PAYMENT - Adds to existing law relating to the prompt payment of health insurance claims; to define terms; to provide for the timing and method of claim payments; to provide for provider billing; to provide for interest payments; and to provide exceptions. 02/16 House intro - 1st rdg - to printing 02/17 Rpt prt - to Bus
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-seventh Legislature Second Regular Session - 2004 IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 705 BY BUSINESS COMMITTEE 1 AN ACT 2 RELATING TO PROMPT PAYMENT OF HEALTH 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 PROVIDE FOR THE TIMING AND METHOD OF CLAIM PAYMENTS, TO 5 PROVIDE FOR PROVIDER BILLING, TO PROVIDE FOR INTEREST PAYMENTS AND TO PRO- 6 VIDE EXCEPTIONS; PROVIDING AN EFFECTIVE DATE AND PROVIDING APPLICATION. 7 Be It Enacted by the Legislature of the State of Idaho: 8 SECTION 1. That Title 41, Idaho Code, be, and the same is hereby amended 9 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap- 10 ter 56, Title 41, Idaho Code, and to read as follows: 11 CHAPTER 56 12 PAYMENT OF CLAIMS 13 41-5601. DEFINITIONS. As used in this chapter: 14 (1) "Beneficiary" means a policyholder, subscriber, member, or other per- 15 son who is eligible for benefits under a contract providing hospital, surgi- 16 cal, or medical expense coverage or a managed care organization or other pol- 17 icy or agreement under which a third party payer agrees to reimburse for cov- 18 ered health care services rendered to beneficiaries in accordance with the 19 benefits contract. 20 (2) "Claim" is an electronically submitted claim from or on behalf of a 21 provider. 22 (3) "Date of payment" means the date the payment is sent by the insurer 23 to the provider. 24 (4) "Electronically submitted" means any process of communication that is 25 suitable for the retention, retrieval and reproduction of information by the 26 recipient and which does not directly involve the physical transfer of paper. 27 (5) "Insurer" means an authorized insurer, as defined in section 41-110, 28 Idaho Code, that issues health insurance policies to any person within this 29 state. 30 (6) "Provider" means a physician licensed to practice medicine pursuant 31 to Idaho law and who is in a contractual relationship to provide health care 32 services with the insurer to whom the claim is submitted. 33 (7) "Receipt of claim" means the date the initial claim or the additional 34 requested information or documentation is actually received, whichever is 35 later, by the insurer. 36 41-5602. TIMING AND METHOD OF CLAIM PAYMENTS. (1) Unless otherwise pro- 37 vided in this chapter, an insurer shall process a claim for payment for health 38 care services rendered by a provider to a beneficiary in accordance with this 39 section. 40 (2) An insurer shall pay, request additional information, or deny a claim 41 not later than thirty (30) days after receipt of the claim. 2 1 (3) If an insurer denies the claim or needs additional information to 2 process the claim, the insurer shall notify the provider and the beneficiary 3 electronically or in writing. The notice shall state why the insurer denied 4 the claim. If the claim was denied because more information is required to 5 process the claim, the notice shall identify the additional information or 6 supporting documentation that is needed to evaluate the claim for processing. 7 (4) Insurers and providers shall, in connection with all claims, use the 8 current procedural terminology (CPT) code in effect, as published by the Amer- 9 ican medical association, the international classification of disease (ICD) 10 code in effect, as published by the United States department of health and 11 human services, or the healthcare common procedural coding system (HCPCS) code 12 in effect, as published by the United States centers for medicaid and medicare 13 services (CMMS). 14 (5) The provisions of this chapter shall apply only to electronically 15 submitted claims. 16 41-5603. PROVIDER BILLING. (1) The provider shall be permitted to send a 17 bill to the beneficiary for payment of any applicable copayment, coinsurance 18 or deductible. 19 (2) The provider may send an informational statement to the beneficiary 20 setting forth the charges for the services rendered. Any such statement shall 21 include language, in boldface type with a font size not less than eighteen 22 (18), informing the beneficiary that the provider has submitted the claim to 23 the beneficiary's insurer for payment and that the beneficiary is not required 24 to submit payment, except for any applicable copayment, coinsurance or deduct- 25 ible, to the provider until the insurer has met the requirements of this chap- 26 ter. 27 (3) A provider shall be required to submit any claim for delivery of 28 health care services under a health benefit plan to an insurer for payment 29 pursuant to the contractual terms agreed to between the health carrier and the 30 provider. The provider shall submit to the health carrier within ten (10) 31 business days after receipt of request to do so, any additional written item- 32 ization, document, or other information required by the health carrier to jus- 33 tify the claim. 34 41-5604. INTEREST PAYMENTS. An insurer that fails to pay, request addi- 35 tional information or documentation or deny a claim to a provider within the 36 time periods established in this chapter shall pay interest at the contract 37 statutory rate pursuant to section 28-22-104, Idaho Code, on the unpaid amount 38 of a claim that is determined to be due and owing. The interest shall accrue 39 from the date payment was due, pursuant to the provisions of this chapter, 40 until the claim is paid. Payment of any interest amount of less than five dol- 41 lars ($5.00) shall not be required. Insurers may add any interest due to a 42 future payment to the provider. 43 41-5605. EXCEPTIONS. The time periods set forth in this chapter shall not 44 apply to claims for which there is evidence of fraud, or misrepresentation by 45 a provider or beneficiary, or to instances where the insurer has not been 46 granted reasonable access to the information under the provider's control. An 47 insurer is not required to comply with the time periods set forth in this 48 chapter if the failure to comply is due to an act of God, bankruptcy, an act 49 of a governmental authority responding to an act of God or emergency, or the 50 result of a strike, walkout or other labor dispute, act of terrorism or during 51 a declaration of war. 3 1 SECTION 2. This act shall be in full force and effect on and after July 2 1, 2005, and shall apply to those claims with a date of service by a provider 3 on and after July 1, 2005.
STATEMENT OF PURPOSE RS 13944 This legislation requires prompt payment by health insurance carriers of claims submitted electronically by contracting physician providers. 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 copayments. It requires a health insurance carrier to pay the physician the statutory contract rate of interest for claims not paid within the proper time frame. FISCAL NOTE There is no fiscal impact. Contact: Idaho Association of Health Plans Steve Tobiason 342-4545 Lyn Darrington 336-1986 STATEMENT OF PURPOSE/FISCAL NOTE H 705