2019 -- S 0217

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LC001003

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

____________

A N   A C T

RELATING TO INSURANCE -- PROMPT PROCESSING OF CLAIMS

     

     Introduced By: Senators DiPalma, Miller, Goldin, Archambault, and Picard

     Date Introduced: January 31, 2019

     Referred To: Senate Health & Human Services

     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 office of the health insurance commissioner (commissioner) finds that the

27

entity or plan is in substantial compliance with this section. A health care entity or health plan

28

seeking such a finding from the director commissioner shall submit any documentation that the

29

director commissioner shall require. A health care entity or health plan which is found to be in

30

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

31

director commissioner may require on an annual a quarterly basis for the director commissioner

32

to assess ongoing compliance with this section.

33

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

34

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

 

LC001003 - Page 2 of 15

1

health care entity or health plan is converting or substantially modifying its claims processing

2

systems.

3

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

4

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

5

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

6

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

7

claim whether via electronic submission or as a paper claim.

8

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

9

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

10

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

11

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

12

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

13

provider or a certified community mental health center, opioid treatment provider or other non-

14

CMHC providers of Medicaid services.

15

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

16

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

17

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

18

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

19

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

20

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

21

and procedures provided for by the health plan.; or

22

     (iii) All persons enrolled and approved via the department of behavioral healthcare,

23

developmental disabilities and hospitals (BHDDH), portal.

24

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

25

designated by that person.

26

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

27

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

28

subsections (a) and (b) of this section ratio by the number of claims paid or processed by a subject

29

entity within the timeframes set forth in subsection (a) of this section to the number of claims

30

received, is ninety-five percent (95%) or greater.

31

     (i) To measure the level of substantial compliance with the parity statute, any health plan

32

contracting with the executive office of health and human services (EOHHS) must report prompt

33

Medicaid claims processing of data by service line on a quarterly basis, and include the following

34

information:

 

LC001003 - Page 3 of 15

1

     (A) Total number of claims received within the quarter;

2

     (B) Total number of claims paid within statutory timeframes;

3

     (C) Total number of claims paid outside of statutory timeframes;

4

     (D) Average processing time (in days) for all claims paid within statutory timeframes;

5

     (E) Average processing time (in days) for all claims paid outside of statutory timeframes;

6

and

7

     (F) Total interest paid on claims paid outside of statutory timeframes.

8

     (ii) All data must be submitted within thirty (30) days following the close of the quarter.

9

     (iii) If the health plan is meeting the federal and/or contractual Medicaid reimbursement

10

requirements, but is processing and paying behavioral health claims in an unequitable manner, it

11

will qualify as a non-quantitative insurer practice and sanctions will be applied through the office

12

of the health insurance commissioner.

13

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

14

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

15

     (h) Pre-payment and timely payment. The executive office of health and human services

16

(EOHHS) shall impose a timely claims processing and payment procedure for Medicaid services.

17

If the health plan fails to reimburse the health care provider or policy holder within the required

18

timeframes as outlined under subsection (a) of this section, EOHHS, office of Medicaid, will

19

mandate under contractual agreement that the health plan execute a pre-payment reimbursement

20

plan with agreement of the health care provider.

21

     The pre-payment reimbursement plan shall require the health plan to pay a health care

22

provider rendering opioid treatment program health home services; integrated health home

23

services (IHH) including vocational and therapy services, assertive community treatment (ACT),

24

mental health psychiatric rehabilitation residences (MHPRR), and substance use disorder

25

residential treatment services.

26

     Payment on a pre-payment basis shall require payment by the health plan on the first

27

business day of each month with each payment amount equal to the average monthly payment

28

received for individuals on the attribution list during the immediate preceding six (6) months.

29

The health care provider and health plan shall undertake a reconciliation within one hundred

30

eighty (180) days of the close of each quarter with any overpayment repaid by the health care

31

provider or underpayment paid by the health plan within thirty (30) days.

32

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

33

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

34

     27-19-52. Prompt processing of claims.

 

LC001003 - Page 4 of 15

1

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

2

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

3

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

4

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

5

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

6

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

7

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

8

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

9

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

10

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

11

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

12

complete a claim.

13

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

14

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

15

section.

16

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

17

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

18

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

19

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

20

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

21

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

22

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

23

or the policyholder.

24

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

25

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

26

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

27

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

28

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

29

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

30

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

31

matters beyond its control that are not caused by it.

32

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

33

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

34

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

 

LC001003 - Page 5 of 15

1

received the notice provided for in § 27-18-61(b) subsection (b) of this section; provided, this

2

exception shall not apply in the event compliance is rendered impossible due to matters beyond

3

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

4

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

5

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

6

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

7

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

8

the department of business regulation office of the health insurance commissioner

9

(commissioner) finds that the entity or plan is in substantial compliance with this section. A

10

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

11

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

12

health plan which is found to be in substantial compliance with this section shall after this

13

thereafter submit any documentation that the director commissioner may require on an annual

14

quarterly basis for the director commissioner to assess ongoing compliance with this section.

15

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

16

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

17

health care entity or health plan is converting or substantially modifying its claims processing

18

systems.

19

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

20

     (1) "Claim" means:

21

     (i) A bill or invoice for covered services;

22

     (ii) A line item of service; or

23

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

24

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

25

claim whether via electronic submission or has a paper claim.

26

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

27

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

28

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

29

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

30

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

31

a certified community mental health center, opioid treatment provider or other non-CMHC

32

providers of Medicaid services.

33

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

34

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

 

LC001003 - Page 6 of 15

1

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

2

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

3

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

4

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

5

and procedures provided for by the health plan.; or

6

     (iii) All persons enrolled and approved via the department of behavioral healthcare,

7

developmental disabilities and hospitals (BHDDH) portal.

8

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

9

designated by that person.

10

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

11

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

12

§ 27-18-61(a) and (b) ratio by the number of claims paid or processed by a subject entity within

13

the timeframes set forth in subsection (a) of this section to the number of claims received, is

14

ninety-five percent (95%) or greater.

15

     (i) To measure the level of substantial compliance with the parity statute, any health plan

16

contracting with the executive office of health and human services (EOHHS) must report prompt

17

Medicaid claims processing of data by service line on a quarterly basis, and include the following

18

information:

19

     (A) Total number of claims received within the quarter;

20

     (B) Total number of claims paid within statutory timeframes;

21

     (C) Total number of claims paid outside of statutory timeframes;

22

     (D) Average processing time (in days) for all claims paid within statutory timeframes;

23

     (E) Average processing time (in days) for all claims paid outside of statutory timeframes;

24

and

25

     (F) Total interest paid on claims paid outside of statutory timeframes.

26

     (ii) All data must be submitted within thirty (30) days following the close of the quarter.

27

     (iii) If the health plan is meeting the federal and/or contractual Medicaid reimbursement

28

requirements, but is processing and paying behavioral health claims in an unequitable manner, it

29

will qualify as a non-quantitative insurer practice and sanctions will be applied through the office

30

of the health insurance commissioner.

31

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

32

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

33

     (h) Pre-payment and timely payment. The executive office of health and human services

34

(EOHHS) shall impose a timely claims processing and payment procedure for Medicaid services.

 

LC001003 - Page 7 of 15

1

If the health plan fails to reimburse the health care provider or policy holder within the required

2

timeframes as outlined under subsection (a) of this section, EOHHS, office of Medicaid, will

3

mandate under contractual agreement that the health plan execute a pre-payment reimbursement

4

plan with agreement of the health care provider.

5

     The pre-payment reimbursement plan shall require the health plan to pay a health care

6

provider rendering opioid treatment program health home services; integrated health home

7

services (IHH) including vocational and therapy services, assertive community treatment (ACT),

8

mental health psychiatric rehabilitation residences (MHPRR), and substance use disorder

9

residential treatment services.

10

     Payment on a pre-payment basis shall require payment by the health plan on the first

11

business day of each month with each payment amount equal to the average monthly payment

12

received for individuals on the attribution list during the immediate preceding six (6) months.

13

The health care provider and health plan shall undertake a reconciliation within one hundred

14

eighty (180) days of the close of each quarter with any overpayment repaid by the health care

15

provider or underpayment paid by the health plan within thirty (30) days.

16

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

17

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

18

     27-20-47. Prompt processing of claims.

19

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

20

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

21

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

22

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

23

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

24

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

25

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

26

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

27

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

28

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

29

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

30

complete a claim.

31

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

32

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

33

section.

34

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

 

LC001003 - Page 8 of 15

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

20

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

21

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

the department of business regulation office of the health insurance commissioner

27

(commissioner) finds that the entity or plan is in substantial compliance with this section. A

28

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

29

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

30

health plan which is found to be in substantial compliance with this section shall after this

31

thereafter submit any documentation that the director commissioner may require on an annual a

32

quarterly basis for the director commissioner to assess ongoing compliance with this section.

33

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

34

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

 

LC001003 - Page 9 of 15

1

health care entity or health plan is converting or substantially modifying its claims processing

2

systems.

3

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

4

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

5

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

6

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

7

claim whether via electronic submission or has a paper claim.

8

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

9

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

10

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

11

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

12

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

13

a certified community mental health center, opioid treatment provider or other non-CMHC

14

providers of Medicaid services.

15

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

16

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

17

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

18

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

19

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

20

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

21

and procedures provided for by the health plan.; or

22

     (iii) All persons enrolled and approved via the department of behavioral healthcare,

23

developmental disabilities and hospitals (BHDDH) portal.

24

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

25

designated by that person.

26

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

27

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

28

§ 27-18-61(a) and (b).

29

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

30

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

31

     (h) Pre-payment and timely payment. The executive office of health and human services

32

(EOHHS) shall impose a timely claims processing and payment procedure for Medicaid services.

33

If the health plan fails to reimburse the health care provider or policy holder within the required

34

timeframes as outlined under subsection (a) of this section, EOHHS, office of Medicaid, will

 

LC001003 - Page 10 of 15

1

mandate under contractual agreement that the health plan execute a pre-payment reimbursement

2

plan with agreement of the health care provider.

3

     The pre-payment reimbursement plan shall require the health plan to pay a health care

4

provider rendering opioid treatment program health home services; integrated health home

5

services (IHH) including vocational and therapy services, assertive community treatment (ACT),

6

mental health psychiatric rehabilitation residences (MHPRR), and substance use disorder

7

residential treatment services.

8

     Payment on a pre-payment basis shall require payment by the health plan on the first

9

business day of each month with each payment amount equal to the average monthly payment

10

received for individuals on the attribution list during the immediate preceding six (6) months.

11

The health care provider and health plan shall undertake a reconciliation within one hundred

12

eighty (180) days of the close of each quarter with any overpayment repaid by the health care

13

provider or underpayment paid by the health plan within thirty (30) days.

14

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

15

Maintenance Organizations" is hereby amended to read as follows:

16

     27-41-64. Prompt processing of claims.

17

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

18

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

19

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

20

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

21

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

22

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

23

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

24

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

25

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

26

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

27

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

28

complete a claim.

29

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

30

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

31

section.

32

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

33

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

34

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

 

LC001003 - Page 11 of 15

1

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

2

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

3

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

4

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

5

or the policyholder.

6

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

7

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

8

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

9

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

10

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

11

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

12

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

13

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

14

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

15

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

16

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

17

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

18

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

19

provider and were not caused by the health care provider.

20

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

21

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

22

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

23

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

24

the department of business regulation office of the health insurance commissioner

25

(commissioner) finds that the entity or plan is in substantial compliance with this section. A

26

health care entity or health plan seeking that finding from the director commissioner shall submit

27

any documentation that the director commissioner shall require. A health care entity or health

28

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

29

documentation the director commissioner may require on an annual a quarterly basis for the

30

director commissioner to assess ongoing compliance with this section.

31

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

32

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

33

health care entity or health plan is converting or substantially modifying its claims processing

34

systems.

 

LC001003 - Page 12 of 15

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) that 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 is referred to as a non-institutional provider

11

or a certified community mental health center, opioid treatment provider or other non-CMHC

12

providers of Medicaid 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 the plan 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.; or

20

     (iii) All persons enrolled and approved via the department of behavioral healthcare,

21

developmental disabilities and hospitals (BHDDH) portal.

22

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

23

designated by that person.

24

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

25

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

26

§ 27-18-61(a) and (b) ratio by the number of claims paid or processed by a subject entity within

27

the timeframes set forth in subsection (a) of this section to the number of claims received, is

28

ninety-five percent (95%) or greater.

29

     (i) To measure the level of substantial compliance with the parity statute, any health plan

30

contracting with the executive office of health and human services (EOHHS) must report prompt

31

Medicaid claims processing of data by service line on a quarterly basis, and include the following

32

information:

33

     (A) Total number of claims received within the quarter;

34

     (B) Total number of claims paid within statutory timeframes;

 

LC001003 - Page 13 of 15

1

     (C) Total number of claims paid outside of statutory timeframes;

2

     (D) Average processing time (in days) for all claims paid within statutory timeframes;

3

     (E) Average processing time (in days) for all claims paid outside of statutory timeframes;

4

and

5

     (F) Total interest paid on claims paid outside of statutory timeframes.

6

     (ii) All data must be submitted within thirty (30) days following the close of the quarter.

7

     (iii) If the health plan is meeting the federal and/or contractual Medicaid reimbursement

8

requirements, but is processing and paying behavioral health claims in an unequitable manner, it

9

will qualify as a non-quantitative insurer practice and sanctions will be applied through the office

10

of the health insurance commissioner.

11

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

12

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

13

     (h) Pre-payment and timely payment. The executive office of health and human services

14

(EOHHS) shall impose a timely claims processing and payment procedure for Medicaid services.

15

If the health plan fails to reimburse the health care provider or policy holder within the required

16

timeframes as outlined under subsection (a) of this section, EOHHS, office of Medicaid, will

17

mandate under contractual agreement that the health plan execute a pre-payment reimbursement

18

plan with agreement of the health care provider.

19

     The pre-payment reimbursement plan shall require the health plan to pay a health care

20

provider rendering opioid treatment program health home services; integrated health home

21

services (IHH) including vocational and therapy services, assertive community treatment (ACT),

22

mental health psychiatric rehabilitation residences (MHPRR), and substance use disorder

23

residential treatment services.

24

     Payment on a pre-payment basis shall require payment by the health plan on the first

25

business day of each month with each payment amount equal to the average monthly payment

26

received for individuals on the attribution list during the immediate preceding six (6) months. The

27

health care provider and health plan shall undertake a reconciliation within one hundred eighty

28

(180) days of the close of each quarter with any overpayment repaid by the health care provider

29

or underpayment paid by the health plan within thirty (30) days.

30

     SECTION 5. This act shall take effect upon passage.

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LC001003

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LC001003 - Page 14 of 15

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE -- PROMPT PROCESSING OF CLAIMS

***

1

     This act would provide greater details to be considered when deciding if there has been

2

substantial compliance with the statutes requiring the prompt processing and payment of health

3

insurance claims. It would include certain instances where prepayment of health insurance claims

4

would be required. The act would also require a quarterly report of Medicaid claims processing.

5

In addition compliance with the statute would no longer be determined by the director of business

6

regulations, but rather the commissioner of the office of health insurance.

7

     This act would take effect upon passage.

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LC001003 - Page 15 of 15