2014 -- H 7492

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LC004187

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO INSURANCE -- ACCIDENT AND SICKNESS INSURANCE POLICIES

     

     Introduced By: Representative Charlene Lima

     Date Introduced: February 13, 2014

     Referred To: House Health, Education & Welfare

     It is enacted by the General Assembly as follows:

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     SECTION 1. Section 27-18-61 of the General Laws in Chapter 27-18 entitled "Accident

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and Sickness Insurance Policies" is hereby amended to read as follows:

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     27-18-61. Prompt processing of claims. -- (a) A health care entity or health plan

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operating in the state shall pay all complete claims for covered health care services submitted to

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the health care entity or health plan by a health care provider or by a policyholder within forty

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(40) calendar days following the date of receipt of a complete written claim or within thirty (30)

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calendar days following the date of receipt of a complete electronic claim. Each health plan shall

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establish a written standard defining what constitutes a complete claim and shall distribute this

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standard to all participating providers.

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      (b)(1) If the health care entity or health plan denies or pends a claim, the health care

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entity or health plan shall have thirty (30) calendar days from receipt of the claim to notify in

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writing send a notice, certified mail, return receipt required, to the health care provider or and the

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policyholder of any and all reasons for denying or pending the claim and what, if any, additional

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information is required to process the claim. No health care entity or health plan may limit the

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time period in which additional information may be submitted to complete a claim.

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     (2) Each and every claim denied or pended by the healthcare entity or health plan shall be

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reviewed by a medical specialist in the same field of medicine as the healthcare provider

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submitting the claim. The letters sent certified mail, return receipt requested, shall contain the

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name of the medical specialist reviewing the claim and his/her experience in that field of

 

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medicine in addition to the information set forth in subsection (b)(1) of this section.

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      (c) Any claim that is resubmitted by a health care provider or policyholder shall be

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treated by the health care entity or health plan pursuant to the provisions of subsection (a) of this

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section.

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      (d) A health care entity or health plan which fails to reimburse the health care provider

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or policyholder after receipt by the health care entity or health plan of a complete claim within the

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required timeframes shall pay to the health care provider or the policyholder who submitted the

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claim, in addition to any reimbursement for health care services provided, interest which shall

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accrue at the rate of twelve percent (12%) per annum commencing on the thirty-first (31st) day

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after receipt of a complete electronic claim or on the forty-first (41st) day after receipt of a

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complete written claim, and ending on the date the payment is issued to the health care provider

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or the policyholder.

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      (e) Exceptions to the requirements of this section are as follows:

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      (1) No health care entity or health plan operating in the state shall be in violation of this

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section for a claim submitted by a health care provider or policyholder if:

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      (i) Failure to comply is caused by a directive from a court or federal or state agency;

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      (ii) The health care entity or health plan is in liquidation or rehabilitation or is operating

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in compliance with a court-ordered plan of rehabilitation; or

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      (iii) The health care entity or health plan's compliance is rendered impossible due to

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matters beyond its control that are not caused by it.

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      (2) No health care entity or health plan operating in the state shall be in violation of this

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section for any claim: (i) initially submitted more than ninety (90) days after the service is

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rendered, or (ii) resubmitted more than ninety (90) days after the date the health care provider

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received the notice provided for in subsection (b) of this section; provided, this exception shall

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not apply in the event compliance is rendered impossible due to matters beyond the control of the

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health care provider and were not caused by the health care provider.

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      (3) No health care entity or health plan operating in the state shall be in violation of this

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section while the claim is pending due to a fraud investigation by a state or federal agency.

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      (4) No health care entity or health plan operating in the state shall be obligated under this

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section to pay interest to any health care provider or policyholder for any claim if the director of

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business regulation finds that the entity or plan is in substantial compliance with this section. A

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health care entity or health plan seeking such a finding from the director shall submit any

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documentation that the director shall require. A health care entity or health plan which is found to

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be in substantial compliance with this section shall thereafter submit any documentation that the

 

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director may require on an annual basis for the director to assess ongoing compliance with this

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section.

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      (5) A health care entity or health plan may petition the director for a waiver of the

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provision of this section for a period not to exceed ninety (90) days in the event the health care

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entity or health plan is converting or substantially modifying its claims processing systems.

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      (f) For purposes of this section, the following definitions apply:

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      (1) "Claim" means: (i) a bill or invoice for covered services; (ii) a line item of service; or

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(iii) all services for one patient or subscriber within a bill or invoice.

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      (2) "Date of receipt" means the date the health care entity or health plan receives the

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claim whether via electronic submission or as a paper claim.

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      (3) "Health care entity" means a licensed insurance company or nonprofit hospital or

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medical or dental service corporation or plan or health maintenance organization, or a contractor

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as described in section 23-17.13-2(2), which operates a health plan.

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      (4) "Health care provider" means an individual clinician, either in practice independently

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or in a group, who provides health care services, and otherwise referred to as a non-institutional

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provider.

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      (5) "Health care services" include, but are not limited to, medical, mental health,

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substance abuse, dental and any other services covered under the terms of the specific health plan.

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      (6) "Health plan" means a plan operated by a health care entity that provides for the

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delivery of health care services to persons enrolled in those plans through:

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      (i) Arrangements with selected providers to furnish health care services; and/or

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      (ii) Financial incentive for persons enrolled in the plan to use the participating providers

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and procedures provided for by the health plan.

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      (7) "Policyholder" means a person covered under a health plan or a representative

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designated by that person.

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      (8) "Substantial compliance" means that the health care entity or health plan is

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processing and paying ninety-five percent (95%) or more of all claims within the time frame

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provided for in subsections (a) and (b) of this section.

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      (g) Any provision in a contract between a health care entity or a health plan and a health

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care provider which is inconsistent with this section shall be void and of no force and effect.

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     SECTION 2. This act shall take effect upon passage.

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LC004187

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE -- ACCIDENT AND SICKNESS INSURANCE POLICIES

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     This act would require a healthcare entity or health plan operating in this state who denies

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or pends a claim to notify both the healthcare provider and the policy holder by a notice sent

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certified mail, return receipt requested, of the denial or pending of the claim. The healthcare

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entity or health plan is required to have any denial or pending of the claim reviewed by a medical

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specialist in the same field of medicine as the healthcare provider and the name and experience of

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the medical specialist would be included in the notice of denial or pending of the claim.

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     This act would take effect upon passage.

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LC004187

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