Prompt Payment to Providers 28 TAC 21.280121.2820

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• Prompt Payment to Providers28 TAC
  21.2801-21.2820

Patricia Brewer Director of Project Oversight -
Life Health Licensing Texas Department of
Insurance
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Who Does Not Have to Comply?

• Self-funded ERISA plans
• Workers compensation coverage
• Government, school, and church health plans
• Out-of-state insureds
• Medicaid/Medicare, even if provided through HMOs
• State employee plans (except those involving HMO
  complaints)
• Federal employee plans
• Teacher Retirement System-Care
• University of Texas employees
• TRICARE Standard (CHAMPUS)
• Texas Association of School Boards coverage

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When Does a Company Have to Pay a Claim for a
Health Service?

• Texas law provides different requirements
  depending upon
• Type of coverage - HMO vs. PPO vs. Non-network
  Indemnity
• Who filed the claim - Insured, Enrollee,
  Physician, or Provider
• Status of physician or provider - Contracted vs.
  Non-contracted

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Clean Claim Rules

• Meant to implement and clarify HB 610 passed
  during 1999 legislative session
• Apply to
• HMOs
• PPOs
• Contracted Physicians and Providers

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Clean Claim Rules

• Perform three main functions
• Define elements of a clean claim
• Clarify when the prompt payment period clock
  starts running
• Clarify the required actions of a carrier upon
  receipt of a clean claim

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What is a Clean Claim?

• Data elements - see handouts
• HCFA 1500
• UB-92
• Attachments
• Additional clean claim elements
• Format
• Legible, accurate, complete
• Too much information does not render an otherwise
  clean claim deficient!

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Coordination of Benefits

• The amount(s) paid by primary carrier(s) is a
  clean claim element for secondary carriers
• The statutory claim processing period for
  secondary carriers does not begin until primary
  payor information is provided

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Proof of Claims Submission

• Claims mail log
• Presumed to be received on the third business
  day after the date the claim is mailed and the
  faxed or electronically generated log is
  transmitted
• Return receipt
• Electronic confirmation
• Fax confirmation
• Presumed to be received on the the date of
  signed receipt or electronic/fax confirmation

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What are the Carriers Responsibilities?

• Notice of revised or additional data elements
  and/or attachments. Disclosure may be made by
• Written notice at least 60 days prior to
  requiring additional or revised information
• Revision of physician or provider manual at least
  60 days prior to requiring additional or revised
  information
• Contract provisions

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• Act on clean claims within 45-day statutory
  claims processing period
• Pay the claim, in total, in accordance with the
  contract
• Deny the claim in total and notify the physician
  or provider in writing of the reason for denial
• Pay portion and deny portion, and notify
  physician or provider in writing of reason for
  denial
• Pay (or deny) portion and audit portion, notify
  physician or provider in writing that claim is
  being audited, and pay 85 of the contracted rate
  on the audited portion
• Audit entire claim, notify physician or provider
  in writing that claim is being audited, and pay
  85 of the contracted rate

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• Notice of deficient claims within 45 days
• Notice of changes in claims addresses,
  processors, etc.

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• A physician or provider must refund the 85 audit
  payment
• 30 days after the later of (a) receiving notice
  of audit results, or (b) exhaustion of enrollees
  appeal rights, if appealed within 30-day refund
  period
• Chargebacks are allowed with written notice and
  opportunity to arrange an alternative
  reimbursement method
• If audit continues more than 180 days after claim
  is filed, carrier must pay the remaining 15
  while investigation continues

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Penalties if Carriers Fail to Comply with the
Clean Claim Rules

• Full amount of billed charges up to UC charges,
  or
• Contracted penalty rate provided in the physician
  or providers contract
• Administrative penalties, up to 1,000/day per
  claim, may be assessed and collected by the State
  of Texas

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Date of Claim Payment

• Claim is considered to have been paid on the date
  of
• U.S. Postal Service postmark
• Electronic transmission
• Delivery of the claim payment to a commercial
  carrier, such as UPS or Federal Express, or
• Receipt by the physician or provider, if a claim
  payment is made other than provided above