House Bill hb2007
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Florida House of Representatives - 2002 HB 2007
By the Council for Healthy Communities and Representative
Fasano
1 A bill to be entitled
2 An act relating to health care; amending s.
3 408.036, F.S.; exempting certain services,
4 construction, or programs from
5 certificate-of-need review requirements for
6 existing health facilities under certain
7 circumstances; specifying requirements;
8 requiring the Agency for Health Care
9 Administration to adopt rules and monitor
10 programs for compliance; providing conditions
11 for expiration of an exemption and for
12 prohibiting another exemption for a specified
13 period; providing application; revising the
14 exemption from certificate-of-need requirements
15 for a satellite hospital; amending s. 408.043,
16 F.S.; specifying that certain hospitals in
17 certain counties may add additional beds
18 without agency review under certain
19 circumstances; amending s. 408.7057, F.S.;
20 redesignating a program title; revising
21 definitions; including preferred provider
22 organizations and health insurers in the claim
23 dispute resolution program; specifying
24 timeframes for submission of supporting
25 documentation necessary for dispute resolution;
26 providing consequences for failure to comply;
27 providing an additional responsibility for the
28 claim dispute resolution organization relating
29 to patterns of claim disputes; providing
30 timeframes for review by the resolution
31 organization; directing the agency to notify
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1 appropriate licensure and certification
2 entities as part of violation of final orders;
3 creating s. 627.6131, F.S.; specifying payment
4 of claims provisions applicable to certain
5 health insurers; providing a definition;
6 providing requirements and procedures for
7 paying, denying, or contesting claims;
8 providing criteria and limitations; requiring
9 payment within specified periods; specifying
10 rate of interest charged on overdue payments;
11 providing for electronic and nonelectronic
12 transmission of claims; providing procedures
13 for overpayment recovery; specifying timeframes
14 for adjudication of claims, internally and
15 externally; prohibiting action to collect
16 payment from an insured under certain
17 circumstances; providing applicability;
18 prohibiting contractual modification of
19 provisions of law; specifying circumstances for
20 retroactive claim denial; specifying claim
21 payment requirements; providing for billing
22 review procedures; specifying claim content
23 requirements; establishing a permissible error
24 ratio, specifying its applicability, and
25 providing for fines; creating s. 627.6135,
26 F.S., relating to treatment authorization;
27 providing a definition; specifying
28 circumstances for authorization timeframes;
29 specifying content for response to
30 authorization requests; providing for an
31 obligation for payment, with exception;
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1 providing authorization procedure notice
2 requirements; amending s. 627.651, F.S.;
3 correcting a cross reference, to conform;
4 amending s. 627.662, F.S.; specifying
5 application of certain additional provisions to
6 group, blanket, and franchise health insurance;
7 amending s. 627.638, F.S.; revising
8 requirements relating to direct payment of
9 benefits to specified providers under certain
10 circumstances; amending s. 641.234, F.S.;
11 specifying responsibility of a health
12 maintenance organization for certain violations
13 under certain circumstances; amending s.
14 641.30, F.S.; conforming a cross reference;
15 amending s. 641.3154, F.S.; modifying the
16 circumstances under which a provider knows that
17 an organization is liable for service
18 reimbursement; amending s. 641.3155, F.S.;
19 revising payment of claims provisions
20 applicable to certain health maintenance
21 organizations; providing a definition;
22 providing requirements and procedures for
23 paying, denying, or contesting claims;
24 providing criteria and limitations; requiring
25 payment within specified periods; revising rate
26 of interest charged on overdue payments;
27 providing for electronic and nonelectronic
28 transmission of claims; providing procedures
29 for overpayment recovery; specifying timeframes
30 for adjudication of claims, internally and
31 externally; prohibiting action to collect
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1 payment from a subscriber under certain
2 circumstances; prohibiting contractual
3 modification of provisions of law; specifying
4 circumstances for retroactive claim denial;
5 specifying claim payment requirements;
6 providing for billing review procedures;
7 specifying claim content requirements;
8 establishing a permissible error ratio,
9 specifying its applicability, and providing for
10 fines; amending s. 641.3156, F.S., relating to
11 treatment authorization; providing a
12 definition; specifying circumstances for
13 authorization timeframes; specifying content
14 for response to authorization requests;
15 providing for an obligation for payment, with
16 exception; providing authorization procedure
17 notice requirements; providing effective dates.
18
19 Be It Enacted by the Legislature of the State of Florida:
20
21 Section 1. Effective upon this act becoming a law,
22 paragraphs (t), (u), and (v) are added to subsection (3) of
23 section 408.036, Florida Statutes, to read:
24 408.036 Projects subject to review.--
25 (3) EXEMPTIONS.--Upon request, the following projects
26 are subject to exemption from the provisions of subsection
27 (1):
28 (t) For the provision of health services, long-term
29 care hospital services, new construction, or tertiary health
30 services excluding solid organ transplant services, by an
31 existing hospital, provided that the hospital utilizes
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1 existing bed capacity and does not exceed the current licensed
2 bed capacity for that facility. Utilizing existing bed
3 capacity, a hospital may offer the exempted services within
4 the hospital's respective health planning district.
5 1. In addition to any other documentation required by
6 the agency, a request for an exemption submitted under this
7 paragraph must certify that the applicant will meet and
8 continuously maintain the minimum licensure requirements
9 governing such programs adopted by the agency pursuant to
10 subparagraph 2.
11 2. The agency shall adopt minimum licensure
12 requirements by rule which govern the operation of health
13 services, long-term care hospital services, and tertiary
14 health services excluding solid organ transplant services,
15 established pursuant to the exemption provided in this
16 paragraph. The rules shall ensure that such programs:
17 a. Perform only services authorized by the exemption
18 and will not provide any other services not authorized by the
19 exemption.
20 b. Maintain sufficient appropriate equipment and
21 health personnel to ensure quality and safety.
22 c. Maintain appropriate times of operation and
23 protocols to ensure availability and appropriate referrals in
24 emergencies.
25 d. Provide a minimum of 10 percent of its services to
26 charity and Medicaid patients each year.
27 e. Establish quality outcome measures that are
28 evidence-based. The performance of quality outcome measures
29 for such programs must be at least at the 50th percentile of
30 state and national outcome measures.
31
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1 f. Be given an opportunity to correct any deficiencies
2 as noted by the agency prior to the expiration of the
3 authorized exemption.
4 3. The exemption provided by this paragraph shall not
5 apply unless the agency determines that the program is in
6 compliance with the requirements of subparagraph 1. and that
7 the program will, after beginning operation, continuously
8 comply with the rules adopted pursuant to subparagraph 2. The
9 agency shall monitor such programs to ensure compliance with
10 the requirements of subparagraph 2.
11 4.a. The exemption for a program shall expire
12 immediately when the agency determines that the program fails
13 to comply with the rules adopted pursuant to sub-subparagraphs
14 2.a., b., and c.
15 b. Beginning 24 months after a program first begins
16 treating patients, the exemption for the program shall expire
17 when the program fails to comply with the rules adopted
18 pursuant to sub-subparagraph 2.d.
19 5. If the exemption for a program expires pursuant to
20 sub-subparagraph 4.a. or sub-subparagraph 4.b., the agency
21 shall not grant an exemption pursuant to this paragraph for a
22 program located at the same hospital until 2 years following
23 the date of the determination by the agency that the program
24 failed to comply with the rules adopted pursuant to
25 subparagraph 2.
26 (u) For the provision of adult open heart services in
27 a hospital. When a clear problem exists in access to needed
28 cardiac services, consideration must be given to creating an
29 exemption. While such needs might be addressed by the changing
30 of the specific need criteria under the certificate-of-need
31 law, the problem of protracted administrative appeals would
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1 still remain. The exemption must be based upon objective
2 criteria and address and solve the twin problems of geographic
3 and temporal access. A hospital shall be exempt from the
4 certificate-of-need review for the establishment of an open
5 heart surgery program subject to the following conditions and
6 criteria:
7 1. The applicant must certify it will meet and
8 continuously maintain the minimum licensure requirements
9 adopted by the agency governing adult open heart programs,
10 including the most current guidelines of the American College
11 of Cardiology and American Heart Association Guidelines for
12 Adult Open Heart Programs.
13 2. The applicant must certify it will maintain
14 sufficient appropriate equipment and health personnel to
15 ensure quality and safety.
16 3. The applicant must certify it will maintain
17 appropriate times of operation and protocols to ensure
18 availability and appropriate referrals in the event of
19 emergencies.
20 4. The applicant can demonstrate that it is referring
21 300 or more cardiac patients from the hospital, including the
22 emergency room, per year to a hospital with cardiac services,
23 or that the average wait for transfer for 50 percent or more
24 of the cardiac patients exceeds 4 hours.
25 5. The applicant is a general acute care hospital that
26 is in operation for 3 years or more.
27 6. The applicant is performing more than 500
28 diagnostic cardiac catheterization procedures per year,
29 combined inpatient and outpatient.
30 7. The applicant has a formal agreement with an
31 existing statutory teaching hospital or cardiac program
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1 performing 750 open heart cases per year which creates at a
2 minimum an external peer review process. The peer review shall
3 be conducted quarterly the first year of operation and two
4 times a year in the succeeding years until either the program
5 reaches 350 cases per year or demonstrates consistency with
6 state-adopted quality and outcome standards for the service.
7 8. The applicant payor-mix at a minimum reflects the
8 community average for Medicaid, charity care, and self-pay or
9 the applicant must certify that it will provide a minimum of 5
10 percent of Medicaid, charity care, and self-pay to open heart
11 surgery patients.
12 9. If the applicant fails to meet the established
13 criteria for open heart programs or fails to reach 300
14 surgeries per year by the end of year 3, it must show cause
15 why its exemption should not be revoked.
16 (v) For the establishment of a satellite hospital
17 through the relocation of 100 general acute care beds from an
18 existing hospital located in the same district, as defined in
19 s. 408.032(5).
20 Section 2. Subsection (5) is added to section 408.043,
21 Florida Statutes, to read:
22 408.043 Special provisions.--
23 (5) SOLE ACUTE CARE HOSPITAL IN A HIGH GROWTH
24 COUNTY.--Notwithstanding any other provision of law, an acute
25 care hospital licensed under chapter 395 may add up to 180
26 additional beds without agency review, provided such hospital
27 is located in a county that has experienced at least a
28 60-percent growth rate since 1990, is under construction on
29 January 1, 2002, is the sole acute care hospital in the
30 county, and is located such that there is no other acute care
31 hospital within a 10-mile radius of such hospital.
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1 Section 3. Section 408.7057, Florida Statutes, is
2 amended to read:
3 408.7057 Statewide provider and health plan managed
4 care organization claim dispute resolution program.--
5 (1) As used in this section, the term:
6 (a) "Agency" means the Agency for Health Care
7 Administration.
8 (b)(a) "Health plan Managed care organization" means a
9 health maintenance organization or a prepaid health clinic
10 certified under chapter 641, a prepaid health plan authorized
11 under s. 409.912, or an exclusive provider organization
12 certified under s. 627.6472, or a major medical expense health
13 insurance policy, as defined in s. 627.643(2)(e), offered by a
14 group or an individual health insurer licensed pursuant to
15 chapter 624, including a preferred provider organization under
16 s. 627.6471.
17 (c)(b) "Resolution organization" means a qualified
18 independent third-party claim-dispute-resolution entity
19 selected by and contracted with the Agency for Health Care
20 Administration.
21 (2)(a) The agency for Health Care Administration shall
22 establish a program by January 1, 2001, to provide assistance
23 to contracted and noncontracted providers and health plans
24 managed care organizations for resolution of claim disputes
25 that are not resolved by the provider and the health plan
26 managed care organization. The agency shall contract with a
27 resolution organization to timely review and consider claim
28 disputes submitted by providers and health plans managed care
29 organizations and recommend to the agency an appropriate
30 resolution of those disputes. The agency shall establish by
31 rule jurisdictional amounts and methods of aggregation for
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1 claim disputes that may be considered by the resolution
2 organization.
3 (b) The resolution organization shall review claim
4 disputes filed by contracted and noncontracted providers and
5 health plans managed care organizations unless the disputed
6 claim:
7 1. Is related to interest payment;
8 2. Does not meet the jurisdictional amounts or the
9 methods of aggregation established by agency rule, as provided
10 in paragraph (a);
11 3. Is part of an internal grievance in a Medicare
12 managed care organization or a reconsideration appeal through
13 the Medicare appeals process;
14 4. Is related to a health plan that is not regulated
15 by the state;
16 5. Is part of a Medicaid fair hearing pursued under 42
17 C.F.R. ss. 431.220 et seq.;
18 6. Is the basis for an action pending in state or
19 federal court; or
20 7. Is subject to a binding claim-dispute-resolution
21 process provided by contract entered into prior to October 1,
22 2000, between the provider and the managed care organization.
23 (c) Contracts entered into or renewed on or after
24 October 1, 2000, may require exhaustion of an internal
25 dispute-resolution process as a prerequisite to the submission
26 of a claim by a provider or a health plan maintenance
27 organization to the resolution organization when the
28 dispute-resolution program becomes effective.
29 (d) A contracted or noncontracted provider or health
30 plan maintenance organization may not file a claim dispute
31 with the resolution organization more than 12 months after a
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1 final determination has been made on a claim by a health plan
2 or provider maintenance organization.
3 (e) The resolution organization shall require the
4 health plan or provider submitting the claim dispute to submit
5 any supporting documentation to the resolution organization
6 within 15 days after receipt by the health plan or provider of
7 a request from the resolution organization for documentation
8 in support of the claim dispute. The resolution organization
9 may extend the time if appropriate. Failure to submit the
10 supporting documentation within such time period shall result
11 in the dismissal of the submitted claim dispute.
12 (f) The resolution organization shall require the
13 respondent in the claim dispute to submit all documentation in
14 support of its position within 15 days after receiving a
15 request from the resolution organization for supporting
16 documentation. The resolution organization may extend the time
17 if appropriate. Failure to submit the supporting documentation
18 within such time period shall result in a default against the
19 health plan or provider. In the event of such a default, the
20 resolution organization shall issue its written recommendation
21 to the agency that a default be entered against the defaulting
22 entity. The written recommendation shall include a
23 recommendation to the agency that the defaulting entity shall
24 pay the entity submitting the claim dispute the full amount of
25 the claim dispute, plus all accrued interest, and shall be
26 considered a nonprevailing party for the purposes of this
27 section.
28 (g) If, on an ongoing basis, during the preceding
29 12-month period, the resolution organization has reason to
30 believe that a pattern exists on the part of a particular
31 health plan or provider, the resolution organization shall
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1 evaluate the information contained in these cases to determine
2 whether the information as to the timely processing of claims
3 evidences a pattern of violation of s. 627.6131 or s. 641.3155
4 and report its findings, together with substantiating
5 evidence, to the appropriate licensure or certification entity
6 for the health plan or provider.
7 (3) The agency shall adopt rules to establish a
8 process to be used by the resolution organization in
9 considering claim disputes submitted by a provider or health
10 plan managed care organization which must include the issuance
11 by the resolution organization of a written recommendation,
12 supported by findings of fact, to the agency within 60 days
13 after the requested information is received by the resolution
14 organization within the timeframes specified by the resolution
15 organization. In no event shall the review time exceed 90 days
16 following receipt of the initial claim dispute submission by
17 the resolution organization receipt of the claim dispute
18 submission.
19 (4) Within 30 days after receipt of the recommendation
20 of the resolution organization, the agency shall adopt the
21 recommendation as a final order.
22 (5) The agency shall notify within 7 days the
23 appropriate licensure or certification entity whenever there
24 is a violation of a final order issued by the agency pursuant
25 to this section.
26 (6)(5) The entity that does not prevail in the
27 agency's order must pay a review cost to the review
28 organization, as determined by agency rule. Such rule must
29 provide for an apportionment of the review fee in any case in
30 which both parties prevail in part. If the nonprevailing party
31 fails to pay the ordered review cost within 35 days after the
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1 agency's order, the nonpaying party is subject to a penalty of
2 not more than $500 per day until the penalty is paid.
3 (7)(6) The agency for Health Care Administration may
4 adopt rules to administer this section.
5 Section 4. Section 627.6131, Florida Statutes, is
6 created to read:
7 627.6131 Payment of claims.--
8 (1) The contract shall include the following
9 provision:
10
11 "Time of Payment of Claims: After receiving
12 written proof of loss, the insurer will pay
13 monthly all benefits then due for ...(type of
14 benefit).... Benefits for any other loss
15 covered by this policy will be paid as soon as
16 the insurer receives proper written proof."
17
18 (2) As used in this section, the term "claim" for a
19 noninstitutional provider means a paper or electronic billing
20 instrument submitted to the insurer's designated location that
21 consists of the HCFA 1500 data set, or its successor, that has
22 all mandatory entries for a physician licensed under chapter
23 458, chapter 459, chapter 460, or chapter 461 or other
24 appropriate billing instrument that has all mandatory entries
25 for any other noninstitutional provider. For institutional
26 providers, "claim" means a paper or electronic billing
27 instrument submitted to the insurer's designated location that
28 consists of the UB-92 data set or its successor that has all
29 mandatory entries.
30 (3) All claims for payment, whether electronic or
31 nonelectronic:
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1 (a) Are considered received on the date the claim is
2 received by the insurer at its designated claims receipt
3 location.
4 (b) Must be mailed or electronically transferred to an
5 insurer within 9 months after completion of the service and
6 the provider is furnished with the correct name and address of
7 the patient's health insurer.
8 (c) Must not duplicate a claim previously submitted
9 unless it is determined that the original claim was not
10 received or is otherwise lost.
11 (4) For all electronically submitted claims, a health
12 insurer shall:
13 (a) Within 24 hours after the beginning of the next
14 business day after receipt of the claim, provide electronic
15 acknowledgment of the receipt of the claim to the electronic
16 source submitting the claim.
17 (b) Within 20 days after receipt of the claim, pay the
18 claim or notify a provider or designee if a claim is denied or
19 contested. Notice of the insurer's action on the claim and
20 payment of the claim is considered to be made on the date the
21 notice or payment was mailed or electronically transferred.
22 (c)1. Notification of the health insurer's
23 determination of a contested claim must be accompanied by an
24 itemized list of additional information or documents the
25 insurer can reasonably determine are necessary to process the
26 claim.
27 2. A provider must submit the additional information
28 or documentation, as specified on the itemized list, within 35
29 days after receipt of the notification. Failure of a provider
30 to submit by mail or electronically the additional information
31
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1 or documentation requested within 35 days after receipt of the
2 notification may result in denial of the claim.
3 3. A health insurer may not make more than one request
4 for documents under this paragraph in connection with a claim,
5 unless the provider fails to submit all of the requested
6 documents to process the claim or if documents submitted by
7 the provider raise new additional issues not included in the
8 original written itemization, in which case the health insurer
9 may provide the provider with one additional opportunity to
10 submit the additional documents needed to process the claim.
11 In no case may the health insurer request duplicate documents.
12 (d) For purposes of this subsection, electronic means
13 of transmission of claims, notices, documents, forms, and
14 payments shall be used to the greatest extent possible by the
15 health insurer and the provider.
16 (e) A claim must be paid or denied within 90 days
17 after receipt of the claim. Failure to pay or deny a claim
18 within 120 days after receipt of the claim creates an
19 uncontestable obligation to pay the claim.
20 (5) For all nonelectronically submitted claims, a
21 health insurer shall:
22 (a) Effective November 1, 2003, provide acknowledgment
23 of receipt of the claim within 15 days after receipt of the
24 claim to the provider or provide a provider within 15 days
25 after receipt with electronic access to the status of a
26 submitted claim.
27 (b) Within 40 days after receipt of the claim, pay the
28 claim or notify a provider or designee if a claim is denied or
29 contested. Notice of the insurer's action on the claim and
30 payment of the claim is considered to be made on the date the
31 notice or payment was mailed or electronically transferred.
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1 (c)1. Notification of the health insurer's
2 determination of a contested claim must be accompanied by an
3 itemized list of additional information or documents the
4 insurer can reasonably determine are necessary to process the
5 claim.
6 2. A provider must submit the additional information
7 or documentation, as specified on the itemized list, within 35
8 days after receipt of the notification. Failure of a provider
9 to submit by mail or electronically the additional information
10 or documentation requested within 35 days after receipt of the
11 notification may result in denial of the claim.
12 3. A health insurer may not make more than one request
13 for documents under this paragraph in connection with a claim
14 unless the provider fails to submit all of the requested
15 documents to process the claim or if documents submitted by
16 the provider raise new additional issues not included in the
17 original written itemization, in which case the health insurer
18 may provide the provider with one additional opportunity to
19 submit the additional documents needed to process the claim.
20 In no case may the health insurer request duplicate documents.
21 (d) For purposes of this subsection, electronic means
22 of transmission of claims, notices, documents, forms, and
23 payments shall be used to the greatest extent possible by the
24 health insurer and the provider.
25 (e) A claim must be paid or denied within 120 days
26 after receipt of the claim. Failure to pay or deny a claim
27 within 140 days after receipt of the claim creates an
28 uncontestable obligation to pay the claim.
29 (6) If a health insurer determines that it has made an
30 overpayment to a provider for services rendered to an insured,
31 the health insurer must make a claim for such overpayment. A
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1 health insurer that makes a claim for overpayment to a
2 provider under this section shall give the provider a written
3 or electronic statement specifying the basis for the
4 retroactive denial or payment adjustment. The insurer must
5 identify the claim or claims, or overpayment claim portion
6 thereof, for which a claim for overpayment is submitted.
7 (a) If an overpayment determination is the result of
8 retroactive review or audit of coverage decisions or payment
9 levels not related to fraud, a health insurer shall adhere to
10 the following procedures:
11 1. All claims for overpayment must be submitted to a
12 provider within 30 months after the health insurer's payment
13 of the claim. A provider must pay, deny, or contest the health
14 insurer's claim for overpayment within 40 days after the
15 receipt of the claim. All contested claims for overpayment
16 must be paid or denied within 120 days after receipt of the
17 claim. Failure to pay or deny overpayment and claim within 140
18 days after receipt creates an uncontestable obligation to pay
19 the claim.
20 2. A provider that denies or contests a health
21 insurer's claim for overpayment or any portion of a claim
22 shall notify the health insurer, in writing, within 35 days
23 after the provider receives the claim that the claim for
24 overpayment is contested or denied. The notice that the claim
25 for overpayment is denied or contested must identify the
26 contested portion of the claim and the specific reason for
27 contesting or denying the claim and, if contested, must
28 include a request for additional information. If the health
29 insurer submits additional information, the health insurer
30 must, within 35 days after receipt of the request, mail or
31 electronically transfer the information to the provider. The
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1 provider shall pay or deny the claim for overpayment within 45
2 days after receipt of the information. The notice is
3 considered made on the date the notice is mailed or
4 electronically transferred by the provider.
5 3. Failure of a health insurer to respond to a
6 provider's contesting of claim or request for additional
7 information regarding the claim within 35 days after receipt
8 of such notice may result in denial of the claim.
9 4. The health insurer may not reduce payment to the
10 provider for other services unless the provider agrees to the
11 reduction in writing or fails to respond to the health
12 insurer's overpayment claim as required by this paragraph.
13 5. Payment of an overpayment claim is considered made
14 on the date the payment was mailed or electronically
15 transferred. An overdue payment of a claim bears simple
16 interest at the rate of 12 percent per year. Interest on an
17 overdue payment for a claim for an overpayment begins to
18 accrue when the claim should have been paid, denied, or
19 contested.
20 (b) A claim for overpayment shall not be permitted
21 beyond 30 months after the health insurer's payment of a
22 claim, except that claims for overpayment may be sought beyond
23 that time from providers convicted of fraud pursuant to s.
24 817.234.
25 (7) Payment of a claim is considered made on the date
26 the payment was mailed or electronically transferred. An
27 overdue payment of a claim bears simple interest of 12 percent
28 per year. Interest on an overdue payment for a claim or for
29 any portion of a claim begins to accrue when the claim should
30 have been paid, denied, or contested. The interest is payable
31 with the payment of the claim.
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1 (8) For all contracts entered into or renewed on or
2 after October 1, 2002, a health insurer's internal dispute
3 resolution process related to a denied claim not under active
4 review by a mediator, arbitrator, or third-party dispute
5 entity must be finalized within 60 days after the receipt of
6 the provider's request for review or appeal.
7 (9) A provider or any representative of a provider,
8 regardless of whether the provider is under contract with the
9 health insurer, may not collect or attempt to collect money
10 from, maintain any action at law against, or report to a
11 credit agency an insured for payment of covered services for
12 which the health insurer contested or denied the provider's
13 claim. This prohibition applies during the pendency of any
14 claim for payment made by the provider to the health insurer
15 for payment of the services or internal dispute resolution
16 process to determine whether the health insurer is liable for
17 the services. For a claim, this pendency applies from the
18 date the claim or a portion of the claim is denied to the date
19 of the completion of the health insurer's internal dispute
20 resolution process, not to exceed 60 days.
21 (10) The provisions of this section may not be waived,
22 voided, or nullified by contract.
23 (11) A health insurer may not retroactively deny a
24 claim because of insured ineligibility more than 1 year after
25 the date of payment of the claim.
26 (12) A health insurer shall pay a contracted primary
27 care or admitting physician, pursuant to such physician's
28 contract, for providing inpatient services in a contracted
29 hospital to an insured if such services are determined by the
30 health insurer to be medically necessary and covered services
31 under the health insurer's contract with the contract holder.
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1 (13) Upon written notification by an insured, an
2 insurer shall investigate any claim of improper billing by a
3 physician, hospital, or other health care provider. The
4 insurer shall determine if the insured was properly billed for
5 only those procedures and services that the insured actually
6 received. If the insurer determines that the insured has been
7 improperly billed, the insurer shall notify the insured and
8 the provider of its findings and shall reduce the amount of
9 payment to the provider by the amount determined to be
10 improperly billed. If a reduction is made due to such
11 notification by the insured, the insurer shall pay to the
12 insured 20 percent of the amount of the reduction up to $500.
13 (14) A permissible error ratio of 5 percent is
14 established for insurer's claims payment violations of s.
15 627.6131(4)(a), (b), (c), and (e) and (5)(a), (b), (c), and
16 (e). If the error ratio of a particular insurer does not
17 exceed the permissible error ratio of 5 percent for an audit
18 period, no fine shall be assessed for the noted claims
19 violations for the audit period. The error ratio shall be
20 determined by dividing the number of claims with violations
21 found on a statistically valid sample of claims for the audit
22 period by the total number of claims in the sample. If the
23 error ratio exceeds the permissible error ratio of 5 percent,
24 a fine may be assessed according to s. 624.4211 for those
25 claims payment violations which exceed the error ratio.
26 Notwithstanding the provisions of this section, the department
27 may fine a health insurer for claims payment violations of s.
28 627.6131(4)(e) and (5)(e) which create an uncontestable
29 obligation to pay the claim. The department shall not fine
30 insurers for violations which the department determines were
31 due to circumstances beyond the insurer's control.
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1 (15) This section is applicable only to a major
2 medical expense health insurance policy as defined in s.
3 627.643(2)(e) offered by a group or an individual health
4 insurer licensed pursuant to chapter 624, including a
5 preferred provider policy under s. 627.6471 and an exclusive
6 provider organization under s. 627.6472 or a group or
7 individual insurance contract that provides payment for
8 enumerated dental services.
9 Section 5. Section 627.6135, Florida Statutes, is
10 created to read:
11 627.6135 Treatment authorization; payment of claims.--
12 (1) For purposes of this section, "authorization"
13 consists of any requirement of a provider to obtain prior
14 approval or to provide documentation relating to the necessity
15 of a covered medical treatment or service as a condition for
16 reimbursement for the treatment or service prior to the
17 treatment or service. Each authorization request from a
18 provider must be assigned an identification number by the
19 health insurer.
20 (2) Upon receipt of a request from a provider for
21 authorization, the health insurer shall make a determination
22 within a reasonable time appropriate to medical circumstance
23 indicating whether the treatment or services are authorized.
24 For urgent care requests for which the standard timeframe for
25 the health insurer to make a determination would seriously
26 jeopardize the life or health of an insured or would
27 jeopardize the insured's ability to regain maximum function, a
28 health insurer must notify the provider as to its
29 determination as soon as possible taking into account medical
30 exigencies.
31
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1 (3) Each response to an authorization request must be
2 assigned an identification number. Each authorization provided
3 by a health insurer must include the date of request of
4 authorization, a timeframe of the authorization, length of
5 stay if applicable, identification number of the
6 authorization, place of service, and type of service.
7 (4) A claim for treatment may not be denied if a
8 provider follows the health insurer's authorization procedures
9 and receives authorization for a covered service for an
10 eligible insured unless the provider provided information to
11 the health insurer with the intention to misinform the health
12 insurer.
13 (5) A health insurer's requirements for authorization
14 for medical treatment or services and 30-day advance notice of
15 material change in such requirements must be provided to all
16 contracted providers and upon request to all noncontracted
17 providers. A health insurer that makes such requirements and
18 advance notices accessible to providers and insureds
19 electronically shall be deemed to be in compliance with this
20 subsection.
21 Section 6. Subsection (4) of section 627.651, Florida
22 Statutes, is amended to read:
23 627.651 Group contracts and plans of self-insurance
24 must meet group requirements.--
25 (4) This section does not apply to any plan which is
26 established or maintained by an individual employer in
27 accordance with the Employee Retirement Income Security Act of
28 1974, Pub. L. No. 93-406, or to a multiple-employer welfare
29 arrangement as defined in s. 624.437(1), except that a
30 multiple-employer welfare arrangement shall comply with ss.
31 627.419, 627.657, 627.6575, 627.6578, 627.6579, 627.6612,
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1 627.66121, 627.66122, 627.6615, 627.6616, and 627.662(8)(6).
2 This subsection does not allow an authorized insurer to issue
3 a group health insurance policy or certificate which does not
4 comply with this part.
5 Section 7. Section 627.662, Florida Statutes, is
6 amended to read:
7 627.662 Other provisions applicable.--The following
8 provisions apply to group health insurance, blanket health
9 insurance, and franchise health insurance:
10 (1) Section 627.569, relating to use of dividends,
11 refunds, rate reductions, commissions, and service fees.
12 (2) Section 627.602(1)(f) and (2), relating to
13 identification numbers and statement of deductible provisions.
14 (3) Section 627.635, relating to excess insurance.
15 (4) Section 627.638, relating to direct payment for
16 hospital or medical services.
17 (5) Section 627.640, relating to filing and
18 classification of rates.
19 (6) Section 627.613, relating to timely payment of
20 claims, or s. 627.6131, relating to payment of claims.
21 (7) Section 627.6135, relating to treatment
22 authorizations and payment of claims.
23 (8)(6) Section 627.645(1), relating to denial of
24 claims.
25 (9)(7) Section 627.613, relating to time of payment of
26 claims.
27 (10)(8) Section 627.6471, relating to preferred
28 provider organizations.
29 (11)(9) Section 627.6472, relating to exclusive
30 provider organizations.
31
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1 (12)(10) Section 627.6473, relating to combined
2 preferred provider and exclusive provider policies.
3 (13)(11) Section 627.6474, relating to provider
4 contracts.
5 Section 8. Subsection (2) of section 627.638, Florida
6 Statutes, is amended to read:
7 627.638 Direct payment for hospital, medical
8 services.--
9 (2) Whenever, in any health insurance claim form, an
10 insured specifically authorizes payment of benefits directly
11 to any recognized hospital or physician, the insurer shall
12 make such payment to the designated provider of such services,
13 unless otherwise provided in the insurance contract. However,
14 if:
15 (a) The benefit is determined to be covered under the
16 terms of the policy;
17 (b) The claim is limited to treatment of mental health
18 or substance abuse, including drug and alcohol abuse; and
19 (c) The insured authorizes the insurer, in writing, as
20 part of the claim to make direct payment of benefits to a
21 recognized hospital, physician, or other licensed provider,
22
23 payments shall be made directly to the recognized hospital,
24 physician, or other licensed provider, notwithstanding any
25 contrary provisions in the insurance contract.
26 Section 9. Subsection (4) is added to section 641.234,
27 Florida Statutes, to read:
28 641.234 Administrative, provider, and management
29 contracts.--
30 (4) If a health maintenance organization, through a
31 health care risk contract, transfers to any entity the
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1 obligations to pay any provider for any claims arising from
2 services provided to or for the benefit of any subscriber of
3 the organization, the health maintenance organization shall
4 remain responsible for any violations of ss. 641.3155 and
5 641.51(4). The provisions of ss. 624.418-624.4211 and 641.52
6 shall apply to any such violations. For purposes of this
7 subsection:
8 (a) The term "health care risk contract" shall mean a
9 contract under which an entity receives compensation in
10 exchange for providing to the health maintenance organization
11 a provider network or other services, which may include
12 administrative services.
13 (b) The term "entity" shall not include any provider
14 or group practice, as defined in s. 456.053, providing
15 services under the scope of the license of the provider or the
16 members of the group practice.
17 Section 10. Subsection (1) of section 641.30, Florida
18 Statutes, is amended to read:
19 641.30 Construction and relationship to other laws.--
20 (1) Every health maintenance organization shall accept
21 the standard health claim form prescribed pursuant to s.
22 641.3155 627.647.
23 Section 11. Subsection (4) of section 641.3154,
24 Florida Statutes, is amended to read:
25 641.3154 Organization liability; provider billing
26 prohibited.--
27 (4) A provider or any representative of a provider,
28 regardless of whether the provider is under contract with the
29 health maintenance organization, may not collect or attempt to
30 collect money from, maintain any action at law against, or
31 report to a credit agency a subscriber of an organization for
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1 payment of services for which the organization is liable, if
2 the provider in good faith knows or should know that the
3 organization is liable. This prohibition applies during the
4 pendency of any claim for payment made by the provider to the
5 organization for payment of the services and any legal
6 proceedings or dispute resolution process to determine whether
7 the organization is liable for the services if the provider is
8 informed that such proceedings are taking place. It is
9 presumed that a provider does not know and should not know
10 that an organization is liable unless:
11 (a) The provider is informed by the organization that
12 it accepts liability;
13 (b) A court of competent jurisdiction determines that
14 the organization is liable; or
15 (c) The department or agency makes a final
16 determination that the organization is required to pay for
17 such services subsequent to a recommendation made by the
18 Statewide Provider and Subscriber Assistance Panel pursuant to
19 s. 408.7056; or
20 (d) The agency issues a final order that the
21 organization is required to pay for such services subsequent
22 to a recommendation made by a resolution organization pursuant
23 to s. 408.7057.
24 Section 12. Section 641.3155, Florida Statutes, is
25 amended to read:
26 (Substantial rewording of section. See
27 s. 641.3155, F.S., for present text.)
28 641.3155 Prompt payment of claims.--
29 (1) As used in this section, the term "claim" for a
30 noninstitutional provider means a paper or electronic billing
31 instrument submitted to the health maintenance organization's
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1 designated location that consists of the HCFA 1500 data set,
2 or its successor, that has all mandatory entries for a
3 physician licensed under chapter 458, chapter 459, chapter
4 460, or chapter 461 or other appropriate billing instrument
5 that has all mandatory entries for any other noninstitutional
6 provider. For institutional providers, "claim" means a paper
7 or electronic billing instrument submitted to the health
8 maintenance organization's designated location that consists
9 of the UB-92 data set or its successor that has all mandatory
10 entries.
11 (2) All claims for payment, whether electronic or
12 nonelectronic:
13 (a) Are considered received on the date the claim is
14 received by the organization at its designated claims receipt
15 location.
16 (b) Must be mailed or electronically transferred to an
17 organization within 9 months after completion of the service
18 and the provider is furnished with the correct name and
19 address of the patient's health insurer.
20 (c) Must not duplicate a claim previously submitted
21 unless it is determined that the original claim was not
22 received or is otherwise lost.
23 (3) For all electronically submitted claims, a health
24 maintenance organization shall:
25 (a) Within 24 hours after the beginning of the next
26 business day after receipt of the claim, provide electronic
27 acknowledgment of the receipt of the claim to the electronic
28 source submitting the claim.
29 (b) Within 20 days after receipt of the claim, pay the
30 claim or notify a provider or designee if a claim is denied or
31 contested. Notice of the organization's action on the claim
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1 and payment of the claim is considered to be made on the date
2 the notice or payment was mailed or electronically
3 transferred.
4 (c)1. Notification of the health maintenance
5 organization's determination of a contested claim must be
6 accompanied by an itemized list of additional information or
7 documents the insurer can reasonably determine are necessary
8 to process the claim.
9 2. A provider must submit the additional information
10 or documentation, as specified on the itemized list, within 35
11 days after receipt of the notification. Failure of a provider
12 to submit by mail or electronically the additional information
13 or documentation requested within 35 days after receipt of the
14 notification may result in denial of the claim.
15 3. A health maintenance organization may not make more
16 than one request for documents under this paragraph in
17 connection with a claim, unless the provider fails to submit
18 all of the requested documents to process the claim or if
19 documents submitted by the provider raise new additional
20 issues not included in the original written itemization, in
21 which case the health maintenance organization may provide the
22 provider with one additional opportunity to submit the
23 additional documents needed to process the claim. In no case
24 may the health maintenance organization request duplicate
25 documents.
26 (d) For purposes of this subsection, electronic means
27 of transmission of claims, notices, documents, forms, and
28 payment shall be used to the greatest extent possible by the
29 health maintenance organization and the provider.
30 (e) A claim must be paid or denied within 90 days
31 after receipt of the claim. Failure to pay or deny a claim
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1 within 120 days after receipt of the claim creates an
2 uncontestable obligation to pay the claim.
3 (4) For all nonelectronically submitted claims, a
4 health maintenance organization shall:
5 (a) Effective November 1, 2003, provide
6 acknowledgement of receipt of the claim within 15 days after
7 receipt of the claim to the provider or designee or provide a
8 provider or designee within 15 days after receipt with
9 electronic access to the status of a submitted claim.
10 (b) Within 40 days after receipt of the claim, pay the
11 claim or notify a provider or designee if a claim is denied or
12 contested. Notice of the health maintenance organization's
13 action on the claim and payment of the claim is considered to
14 be made on the date the notice or payment was mailed or
15 electronically transferred.
16 (c)1. Notification of the health maintenance
17 organization's determination of a contested claim must be
18 accompanied by an itemized list of additional information or
19 documents the organization can reasonably determine are
20 necessary to process the claim.
21 2. A provider must submit the additional information
22 or documentation, as specified on the itemized list, within 35
23 days after receipt of the notification. Failure of a provider
24 to submit by mail or electronically the additional information
25 or documentation requested within 35 days after receipt of the
26 notification may result in denial of the claim.
27 3. A health maintenance organization may not make more
28 than one request for documents under this paragraph in
29 connection with a claim unless the provider fails to submit
30 all of the requested documents to process the claim or if
31 documents submitted by the provider raise new additional
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1 issues not included in the original written itemization, in
2 which case the health maintenance organization may provide the
3 provider with one additional opportunity to submit the
4 additional documents needed to process the claim. In no case
5 may the health maintenance organization request duplicate
6 documents.
7 (d) For purposes of this subsection, electronic means
8 of transmission of claims, notices, documents, forms, and
9 payments shall be used to the greatest extent possible by the
10 health maintenance organization and the provider.
11 (e) A claim must be paid or denied within 120 days
12 after receipt of the claim. Failure to pay or deny a claim
13 within 140 days after receipt of the claim creates an
14 uncontestable obligation to pay the claim.
15 (5) If a health maintenance organization determines
16 that it has made an overpayment to a provider for services
17 rendered to a subscriber, the health maintenance organization
18 must make a claim for such overpayment. A health maintenance
19 organization that makes a claim for overpayment to a provider
20 under this section shall give the provider a written or
21 electronic statement specifying the basis for the retroactive
22 denial or payment adjustment. The health maintenance
23 organization must identify the claim or claims, or overpayment
24 claim portion thereof, for which a claim for overpayment is
25 submitted.
26 (a) If an overpayment determination is the result of
27 retroactive review or audit of coverage decisions or payment
28 levels not related to fraud, a health maintenance organization
29 shall adhere to the following procedures:
30 1. All claims for overpayment must be submitted to a
31 provider within 30 months after the health maintenance
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1 organization's payment of the claim. A provider must pay,
2 deny, or contest the health maintenance organization's claim
3 for overpayment within 40 days after the receipt of the claim.
4 All contested claims for overpayment must be paid or denied
5 within 120 days after receipt of the claim. Failure to pay or
6 deny overpayment and claim within 140 days after receipt
7 creates an uncontestable obligation to pay the claim.
8 2. A provider that denies or contests a health
9 maintenance organization's claim for overpayment or any
10 portion of a claim shall notify the organization, in writing,
11 within 35 days after the provider receives the claim that the
12 claim for overpayment is contested or denied. The notice that
13 the claim for overpayment is denied or contested must identify
14 the contested portion of the claim and the specific reason for
15 contesting or denying the claim and, if contested, must
16 include a request for additional information. If the
17 organization submits additional information, the organization
18 must, within 35 days after receipt of the request, mail or
19 electronically transfer the information to the provider. The
20 provider shall pay or deny the claim for overpayment within 45
21 days after receipt of the information. The notice is
22 considered made on the date the notice is mailed or
23 electronically transferred by the provider.
24 3. Failure of a health maintenance organization to
25 respond to a provider's contestment of claim or request for
26 additional information regarding the claim within 35 days
27 after receipt of such notice may result in denial of the
28 claim.
29 4. The health maintenance organization may not reduce
30 payment to the provider for other services unless the provider
31 agrees to the reduction in writing or fails to respond to the
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1 health maintenance organization's overpayment claim as
2 required by this paragraph.
3 5. Payment of an overpayment claim is considered made
4 on the date the payment was mailed or electronically
5 transferred. An overdue payment of a claim bears simple
6 interest at the rate of 12 percent per year. Interest on an
7 overdue payment for a claim for an overpayment payment begins
8 to accrue when the claim should have been paid, denied, or
9 contested.
10 (b) A claim for overpayment shall not be permitted
11 beyond 30 months after the health maintenance organization's
12 payment of a claim, except that claims for overpayment may be
13 sought beyond that time from providers convicted of fraud
14 pursuant to s. 817.234.
15 (6) Payment of a claim is considered made on the date
16 the payment was mailed or electronically transferred. An
17 overdue payment of a claim bears simple interest of 12 percent
18 per year. Interest on an overdue payment for a claim or for
19 any portion of a claim begins to accrue when the claim should
20 have been paid, denied, or contested. The interest is payable
21 with the payment of the claim.
22 (7)(a) For all contracts entered into or renewed on or
23 after October 1, 2002, a health maintenance organization's
24 internal dispute resolution process related to a denied claim
25 not under active review by a mediator, arbitrator, or
26 third-party dispute entity must be finalized within 60 days
27 after the receipt of the provider's request for review or
28 appeal.
29 (b) All claims to a health maintenance organization
30 begun after October 1, 2000, not under active review by a
31 mediator, arbitrator, or third-party dispute entity, shall
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1 result in a final decision on the claim by the health
2 maintenance organization by January 2, 2003, for the purpose
3 of the statewide provider and managed care organization claim
4 dispute resolution program pursuant to s. 408.7057.
5 (8) A provider or any representative of a provider,
6 regardless of whether the provider is under contract with the
7 health maintenance organization, may not collect or attempt to
8 collect money from, maintain any action at law against, or
9 report to a credit agency a subscriber for payment of covered
10 services for which the health maintenance organization
11 contested or denied the provider's claim. This prohibition
12 applies during the pendency of any claim for payment made by
13 the provider to the health maintenance organization for
14 payment of the services or internal dispute resolution process
15 to determine whether the health maintenance organization is
16 liable for the services. For a claim, this pendency applies
17 from the date the claim or a portion of the claim is denied to
18 the date of the completion of the health maintenance
19 organization's internal dispute resolution process, not to
20 exceed 60 days.
21 (9) The provisions of this section may not be waived,
22 voided, or nullified by contract.
23 (10) A health maintenance organization may not
24 retroactively deny a claim because of subscriber ineligibility
25 more than 1 year after the date of payment of the claim.
26 (11) A health maintenance organization shall pay a
27 contracted primary care or admitting physician, pursuant to
28 such physician's contract, for providing inpatient services in
29 a contracted hospital to a subscriber if such services are
30 determined by the health maintenance organization to be
31
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1 medically necessary and covered services under the health
2 maintenance organization's contract with the contract holder.
3 (12) Upon written notification by a subscriber, a
4 health maintenance organization shall investigate any claim of
5 improper billing by a physician, hospital, or other health
6 care provider. The organization shall determine if the
7 subscriber was properly billed for only those procedures and
8 services that the subscriber actually received. If the
9 organization determines that the subscriber has been
10 improperly billed, the organization shall notify the
11 subscriber and the provider of its findings and shall reduce
12 the amount of payment to the provider by the amount determined
13 to be improperly billed. If a reduction is made due to such
14 notification by the insured, the insurer shall pay to the
15 insured 20 percent of the amount of the reduction up to $500.
16 (13) A permissible error ratio of 5 percent is
17 established for health maintenance organizations' claims
18 payment violations of s. 641.3155(3)(a), (b), (c), and (e) and
19 (4)(a), (b), (c), and (e). If the error ratio of a particular
20 insurer does not exceed the permissible error ratio of 5
21 percent for an audit period, no fine shall be assessed for the
22 noted claims violations for the audit period. The error ratio
23 shall be determined by dividing the number of claims with
24 violations found on a statistically valid sample of claims for
25 the audit period by the total number of claims in the sample.
26 If the error ratio exceeds the permissible error ratio of 5
27 percent, a fine may be assessed according to s. 624.4211 for
28 those claims payment violations which exceed the error ratio.
29 Notwithstanding the provisions of this section, the department
30 may fine a health maintenance organization for claims payment
31 violations of s. 641.3155(3)(e) and (4)(e) which create an
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1 uncontestable obligation to pay the claim. The department
2 shall not fine organizations for violations which the
3 department determines were due to circumstances beyond the
4 organization's control.
5 Section 13. Section 641.3156, Florida Statutes, is
6 amended to read:
7 641.3156 Treatment authorization; payment of claims.--
8 (1) For purposes of this section, "authorization"
9 consists of any requirement of a provider to obtain prior
10 approval or to provide documentation relating to the necessity
11 of a covered medical treatment or service as a condition for
12 reimbursement for the treatment or service prior to the
13 treatment or service. Each authorization request from a
14 provider must be assigned an identification number by the
15 health maintenance organization A health maintenance
16 organization must pay any hospital-service or referral-service
17 claim for treatment for an eligible subscriber which was
18 authorized by a provider empowered by contract with the health
19 maintenance organization to authorize or direct the patient's
20 utilization of health care services and which was also
21 authorized in accordance with the health maintenance
22 organization's current and communicated procedures, unless the
23 provider provided information to the health maintenance
24 organization with the willful intention to misinform the
25 health maintenance organization.
26 (2) A claim for treatment may not be denied if a
27 provider follows the health maintenance organization's
28 authorization procedures and receives authorization for a
29 covered service for an eligible subscriber, unless the
30 provider provided information to the health maintenance
31
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1 organization with the willful intention to misinform the
2 health maintenance organization.
3 (3) Upon receipt of a request from a provider for
4 authorization, the health maintenance organization shall make
5 a determination within a reasonable time appropriate to
6 medical circumstance indicating whether the treatment or
7 services are authorized. For urgent care requests for which
8 the standard timeframe for the health maintenance organization
9 to make a determination would seriously jeopardize the life or
10 health of a subscriber or would jeopardize the subscriber's
11 ability to regain maximum function, a health maintenance
12 organization must notify the provider as to its determination
13 as soon as possible taking into account medical exigencies.
14 (4) Each response to an authorization request must be
15 assigned an identification number. Each authorization provided
16 by a health maintenance organization must include the date of
17 request of authorization, timeframe of the authorization,
18 length of stay if applicable, identification number of the
19 authorization, place of service, and type of service.
20 (5) A health maintenance organization's requirements
21 for authorization for medical treatment or services and 30-day
22 advance notice of material change in such requirements must be
23 provided to all contracted providers and upon request to all
24 noncontracted providers. A health maintenance organization
25 that makes such requirements and advance notices accessible to
26 providers and subscribers electronically shall be deemed to be
27 in compliance with this paragraph.
28 (6)(3) Emergency services are subject to the
29 provisions of s. 641.513 and are not subject to the provisions
30 of this section.
31
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1 Section 14. Except as otherwise provided herein, this
2 act shall take effect October 1, 2002, and shall apply to
3 claims for services rendered after such date.
4
5 *****************************************
6 HOUSE SUMMARY
7
Provides additional certificate-of-need exemptions for
8 specified health services, construction, programs, and
satellite hospitals from certificate-of-need
9 requirements. Revises claim dispute resolution program
provisions. Creates payment of claims provisions
10 applicable to health insurers and health maintenance
organizations to provide requirements and procedures for
11 paying, denying, or contesting claims, charging interest
on overdue payments, electronic and nonelectronic
12 transmission of claims, overpayment recovery, timeframes
for adjudication of claims, claim payments and contents,
13 billing review, and establishing a permissible error
ratio. Creates treatment authorization provisions for
14 health insurers and health maintenance organizations to
provide requirements and procedures for authorization
15 timeframes, content for response to authorization
requests, obligation for payment, and notice. See bill
16 for details.
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
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