2017 -- H 5844

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LC001937

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2017

____________

A N   A C T

RELATING TO INSURANCE - ACCIDENT AND SICKNESS INSURANCE POLICIES

     

     Introduced By: Representatives Tanzi, Casimiro, Shanley, Ruggiero, and Carson

     Date Introduced: March 02, 2017

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

1

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

2

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

3

     27-18-61. Prompt processing of claims.

4

     (a) A health care entity or health plan operating in the state shall pay all complete claims

5

for covered health care services submitted to the health care entity or health plan by a health care

6

provider or by a policyholder within forty (40) calendar days following the date of receipt of a

7

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

8

complete electronic claim. Each health plan shall establish a written standard defining what

9

constitutes a complete claim and shall distribute this standard to all participating providers.

10

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

11

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

12

the health care provider or policyholder of any and all reasons for denying or pending the claim

13

and what, if any, additional information is required to process the claim. No health care entity or

14

health plan may limit the time period in which additional information may be submitted to

15

complete a claim.

16

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

17

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

18

section.

19

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

 

1

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

2

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

3

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

4

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

5

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

6

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

7

or the policyholder.

8

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

9

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

10

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

11

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

12

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

13

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

14

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

15

matters beyond its control that are not caused by it.

16

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

17

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

18

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

19

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

20

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

21

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

22

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

23

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

24

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

25

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

26

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

27

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

28

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

29

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

30

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

31

section.

32

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

33

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

34

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

 

LC001937 - Page 2 of 11

1

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

2

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

3

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

4

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

5

claim whether via electronic submission or as a paper claim.

6

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

7

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

8

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

9

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

10

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

11

provider or a state-licensed facility that provides mental health and/or substance abuse treatment

12

and/or prevention services.

13

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

14

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

15

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

16

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

17

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

18

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

19

and procedures provided for by the health plan.

20

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

21

designated by that person.

22

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

23

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

24

subsections (a) and (b) of this section.

25

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

26

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

27

     SECTION 2. Section 27-19-52 of the General Laws in Chapter 27-19 entitled "Nonprofit

28

Hospital Service Corporations" is hereby amended to read as follows:

29

     27-19-52. Prompt processing of claims.

30

     (a) A health care entity or health plan operating in the state shall pay all complete claims

31

for covered health care services submitted to the health care entity or health plan by a health care

32

provider or by a policyholder within forty (40) calendar days following the date of receipt of a

33

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

34

complete electronic claim. Each health plan shall establish a written standard defining what

 

LC001937 - Page 3 of 11

1

constitutes a complete claim and shall distribute this standard to all participating providers.

2

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

3

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

4

the health care provider or policyholder of any and all reasons for denying or pending the claim

5

and what, if any, additional information is required to process the claim. No health care entity or

6

health plan may limit the time period in which additional information may be submitted to

7

complete a claim.

8

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

9

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

10

section.

11

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

12

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

13

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

14

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

15

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

16

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

17

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

18

or the policyholder.

19

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

20

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

21

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

22

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

23

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

24

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

25

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

26

matters beyond its control that are not caused by it.

27

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

28

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

29

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

30

received the notice provided for in § 27-18-61(b); provided, this exception shall not apply in the

31

event compliance is rendered impossible due to matters beyond the control of the health care

32

provider and were not caused by the health care provider.

33

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

34

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

 

LC001937 - Page 4 of 11

1

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

2

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

3

the department of business regulation finds that the entity or plan is in substantial compliance

4

with this section. A health care entity or health plan seeking such a finding from the director shall

5

submit any documentation that the director shall require. A health care entity or health plan which

6

is found to be in substantial compliance with this section shall after this submit any

7

documentation that the director may require on an annual basis for the director to assess ongoing

8

compliance with this section.

9

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

10

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

11

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

12

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

13

     (1) "Claim" means:

14

     (i) A bill or invoice for covered services;

15

     (ii) A line item of service; or

16

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

17

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

18

claim whether via electronic submission or has a paper claim.

19

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

20

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

21

as described in § 23-17.13-2(2), that operates a health plan.

22

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

23

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

24

a state-licensed facility that provides mental health and/or substance abuse treatment and/or

25

prevention services.

26

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

27

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

28

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

29

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

30

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

31

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

32

and procedures provided for by the health plan.

33

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

34

designated by that person.

 

LC001937 - Page 5 of 11

1

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

2

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

3

§ 27-18-61(a) and (b).

4

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

5

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

6

     SECTION 3. Section 27-20-47 of the General Laws in Chapter 27-20 entitled "Nonprofit

7

Medical Service Corporations" is hereby amended to read as follows:

8

     27-20-47. Prompt processing of claims.

9

     (a) A health care entity or health plan operating in the state shall pay all complete claims

10

for covered health care services submitted to the health care entity or health plan by a health care

11

provider or by a policyholder within forty (40) calendar days following the date of receipt of a

12

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

13

complete electronic claim. Each health plan shall establish a written standard defining what

14

constitutes a complete claim and shall distribute the standard to all participating providers.

15

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

16

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

17

the health care provider or policyholder of any and all reasons for denying or pending the claim

18

and what, if any, additional information is required to process the claim. No health care entity or

19

health plan may limit the time period in which additional information may be submitted to

20

complete a claim.

21

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

22

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

23

section.

24

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

25

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

26

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

27

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

28

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

29

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

30

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

31

or the policyholder.

32

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

33

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

34

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

 

LC001937 - Page 6 of 11

1

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

2

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

3

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

4

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

5

matters beyond its control that are not caused by it.

6

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

7

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

8

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

9

received the notice provided for in § 27-18-61(b); provided, this exception shall not apply in the

10

event compliance is rendered impossible due to matters beyond the control of the health care

11

provider and were not caused by the health care provider.

12

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

13

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

14

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

15

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

16

the department of business regulation finds that the entity or plan is in substantial compliance

17

with this section. A health care entity or health plan seeking such a finding from the director shall

18

submit any documentation that the director shall require. A health care entity or health plan which

19

is found to be in substantial compliance with this section shall after this submit any

20

documentation that the director may require on an annual basis for the director to assess ongoing

21

compliance with this section.

22

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

23

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

24

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

25

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

26

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

27

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

28

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

29

claim whether via electronic submission or has a paper claim.

30

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

31

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

32

as described in § 23-17.13-2(2), that operates a health plan.

33

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

34

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

 

LC001937 - Page 7 of 11

1

a state-licensed facility that provides mental health and/or substance abuse treatment and/or

2

prevention services.

3

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

4

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

5

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

6

delivery of health care services to persons enrolled in the plan through:

7

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

8

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

9

and procedures provided for by the health plan.

10

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

11

designated by that person.

12

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

13

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

14

§ 27-18-61(a) and (b).

15

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

16

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

17

     SECTION 4. Section 27-41-64 of the General Laws in Chapter 27-41 entitled "Health

18

Maintenance Organizations" is hereby amended to read as follows:

19

     27-41-64. Prompt processing of claims.

20

     (a) A health care entity or health plan operating in the state shall pay all complete claims

21

for covered health care services submitted to the health care entity or health plan by a health care

22

provider or by a policyholder within forty (40) calendar days following the date of receipt of a

23

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

24

complete electronic claim. Each health plan shall establish a written standard defining what

25

constitutes a complete claim and shall distribute this standard to all participating providers.

26

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

27

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

28

the health care provider or policyholder of any and all reasons for denying or pending the claim

29

and what, if any, additional information is required to process the claim. No health care entity or

30

health plan may limit the time period in which additional information may be submitted to

31

complete a claim.

32

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

33

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

34

section.

 

LC001937 - Page 8 of 11

1

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

2

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

3

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

4

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

5

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

6

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

7

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

8

or the policyholder.

9

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

10

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

11

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

12

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

13

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

14

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

15

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

16

matters beyond its control, which are not caused by it.

17

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

18

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

19

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

20

received the notice provided for in § 27-18-61(b); provided, this exception shall not apply in the

21

event compliance is rendered impossible due to matters beyond the control of the health care

22

provider and were not caused by the health care provider.

23

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

24

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

25

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

26

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

27

the department of business regulation finds that the entity or plan is in substantial compliance

28

with this section. A health care entity or health plan seeking that finding from the director shall

29

submit any documentation that the director shall require. A health care entity or health plan which

30

is found to be in substantial compliance with this section shall submit any documentation the

31

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

32

section.

33

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

34

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

 

LC001937 - Page 9 of 11

1

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

2

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

3

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

4

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

5

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

6

claim whether via electronic submission or as a paper claim.

7

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

8

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

9

as described in § 23-17.13-2(2) that operates a health plan.

10

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

11

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

12

or a state-licensed facility that provides mental health and/or substance abuse treatment and/or

13

prevention services.

14

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

15

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

16

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

17

delivery of health care services to persons enrolled in the plan through:

18

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

19

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

20

and procedures provided for by the health plan.

21

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

22

designated by that person.

23

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

24

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

25

§ 27-18-61(a) and (b).

26

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

27

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

28

     SECTION 5. This act shall take effect upon passage.

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LC001937

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LC001937 - Page 10 of 11

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE - ACCIDENT AND SICKNESS INSURANCE POLICIES

***

1

     This act would include a state-licensed facility that provides mental health and/or

2

substance abuse treatment and/or prevention services in the definition of "health care provider"

3

for the purposes of the prompt payment of health insurance claims.

4

     This act would take effect upon passage.

========

LC001937

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LC001937 - Page 11 of 11