House Bill hb0293c1
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Florida House of Representatives - 2002 CS/HB 293
By the Council for Healthy Communities and Representatives
Benson, Negron, Green, Harrell, Ritter, Fasano, Slosberg,
Wishner, Farkas and Kravitz
1 A bill to be entitled
2 An act relating to health care coverage
3 procedures; amending s. 408.7057, F.S.;
4 redesignating a program title; revising
5 definitions; including preferred provider
6 organizations and health insurers in the claim
7 dispute resolution program; specifying
8 timeframes for submission of supporting
9 documentation necessary for dispute resolution;
10 providing consequences for failure to comply;
11 providing an additional responsibility for the
12 claim dispute resolution organization relating
13 to patterns of claim disputes; providing
14 timeframes for review by the resolution
15 organization; directing the agency to notify
16 appropriate licensure and certification
17 entities as part of violation of final orders;
18 amending s. 626.88, F.S.; revising a
19 definition; creating s. 627.6131, F.S.;
20 specifying payment of claims provisions
21 applicable to certain health insurers;
22 providing a definition; providing requirements
23 and procedures for paying, denying, or
24 contesting claims; providing criteria and
25 limitations; requiring payment within specified
26 periods; specifying rate of interest charged on
27 overdue payments; providing for electronic and
28 nonelectronic transmission of claims; providing
29 procedures for overpayment recovery; specifying
30 timeframes for adjudication of claims,
31 internally and externally; prohibiting action
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1 to collect payment from an insured under
2 certain circumstances; providing applicability;
3 prohibiting contractual modification of
4 provisions of law; specifying circumstances for
5 retroactive claim denial; specifying claim
6 payment requirements; providing for billing
7 review procedures; specifying claim content
8 requirements; establishing a permissible error
9 ratio, specifying its applicability, and
10 providing for fines; creating s. 627.6135,
11 F.S., relating to treatment authorization;
12 providing a definition; specifying
13 circumstances for authorization timeframes;
14 specifying content for response to
15 authorization requests; providing for an
16 obligation for payment, with exception;
17 providing authorization procedure notice
18 requirements; amending s. 627.651, F.S.;
19 correcting a cross reference, to conform;
20 amending s. 627.662, F.S.; specifying
21 application of certain additional provisions to
22 group, blanket, and franchise health insurance;
23 amending s. 627.638, F.S.; revising
24 requirements relating to direct payment of
25 benefits to specified providers under certain
26 circumstances; amending s. 641.30, F.S.;
27 conforming a cross reference; amending s.
28 641.3154, F.S.; modifying the circumstances
29 under which a provider knows that an
30 organization is liable for service
31 reimbursement; amending s. 641.3155, F.S.;
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1 revising payment of claims provisions
2 applicable to certain health maintenance
3 organizations; providing a definition;
4 providing requirements and procedures for
5 paying, denying, or contesting claims;
6 providing criteria and limitations; requiring
7 payment within specified periods; revising rate
8 of interest charged on overdue payments;
9 providing for electronic and nonelectronic
10 transmission of claims; providing procedures
11 for overpayment recovery; specifying timeframes
12 for adjudication of claims, internally and
13 externally; prohibiting action to collect
14 payment from a subscriber under certain
15 circumstances; prohibiting contractual
16 modification of provisions of law; specifying
17 circumstances for retroactive claim denial;
18 specifying claim payment requirements;
19 providing for billing review procedures;
20 specifying claim content requirements;
21 establishing a permissible error ratio,
22 specifying its applicability, and providing for
23 fines; amending s. 641.3156, F.S., relating to
24 treatment authorization; providing a
25 definition; specifying circumstances for
26 authorization timeframes; specifying content
27 for response to authorization requests;
28 providing for an obligation for payment, with
29 exception; providing authorization procedure
30 notice requirements; providing application;
31 providing effective dates.
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1 Be It Enacted by the Legislature of the State of Florida:
2
3 Section 1. Section 408.7057, Florida Statutes, is
4 amended to read:
5 408.7057 Statewide provider and health plan managed
6 care organization claim dispute resolution program.--
7 (1) As used in this section, the term:
8 (a) "Agency" means the Agency for Health Care
9 Administration.
10 (b)(a) "Health plan Managed care organization" means a
11 health maintenance organization or a prepaid health clinic
12 certified under chapter 641, a prepaid health plan authorized
13 under s. 409.912, or an exclusive provider organization
14 certified under s. 627.6472, or a major medical expense health
15 insurance policy, as defined in s. 627.643(2)(e), offered by a
16 group or an individual health insurer licensed pursuant to
17 chapter 624, including a preferred provider organization under
18 s. 627.6471.
19 (c)(b) "Resolution organization" means a qualified
20 independent third-party claim-dispute-resolution entity
21 selected by and contracted with the Agency for Health Care
22 Administration.
23 (2)(a) The agency for Health Care Administration shall
24 establish a program by January 1, 2001, to provide assistance
25 to contracted and noncontracted providers and health plans
26 managed care organizations for resolution of claim disputes
27 that are not resolved by the provider and the health plan
28 managed care organization. The agency shall contract with a
29 resolution organization to timely review and consider claim
30 disputes submitted by providers and health plans managed care
31 organizations and recommend to the agency an appropriate
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1 resolution of those disputes. The agency shall establish by
2 rule jurisdictional amounts and methods of aggregation for
3 claim disputes that may be considered by the resolution
4 organization.
5 (b) The resolution organization shall review claim
6 disputes filed by contracted and noncontracted providers and
7 health plans managed care organizations unless the disputed
8 claim:
9 1. Is related to interest payment;
10 2. Does not meet the jurisdictional amounts or the
11 methods of aggregation established by agency rule, as provided
12 in paragraph (a);
13 3. Is part of an internal grievance in a Medicare
14 managed care organization or a reconsideration appeal through
15 the Medicare appeals process;
16 4. Is related to a health plan that is not regulated
17 by the state;
18 5. Is part of a Medicaid fair hearing pursued under 42
19 C.F.R. ss. 431.220 et seq.;
20 6. Is the basis for an action pending in state or
21 federal court; or
22 7. Is subject to a binding claim-dispute-resolution
23 process provided by contract entered into prior to October 1,
24 2000, between the provider and the managed care organization.
25 (c) Contracts entered into or renewed on or after
26 October 1, 2000, may require exhaustion of an internal
27 dispute-resolution process as a prerequisite to the submission
28 of a claim by a provider or a health plan maintenance
29 organization to the resolution organization when the
30 dispute-resolution program becomes effective.
31
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1 (d) A contracted or noncontracted provider or health
2 plan maintenance organization may not file a claim dispute
3 with the resolution organization more than 12 months after a
4 final determination has been made on a claim by a health plan
5 or provider maintenance organization.
6 (e) The resolution organization shall require the
7 health plan or provider submitting the claim dispute to submit
8 any supporting documentation to the resolution organization
9 within 15 days after receipt by the health plan or provider of
10 a request from the resolution organization for documentation
11 in support of the claim dispute. The resolution organization
12 may extend the time if appropriate. Failure to submit the
13 supporting documentation within such time period shall result
14 in the dismissal of the submitted claim dispute.
15 (f) The resolution organization shall require the
16 respondent in the claim dispute to submit all documentation in
17 support of its position within 15 days after receiving a
18 request from the resolution organization for supporting
19 documentation. The resolution organization may extend the time
20 if appropriate. Failure to submit the supporting documentation
21 within such time period shall result in a default against the
22 health plan or provider. In the event of such a default, the
23 resolution organization shall issue its written recommendation
24 to the agency that a default be entered against the defaulting
25 entity. The written recommendation shall include a
26 recommendation to the agency that the defaulting entity shall
27 pay the entity submitting the claim dispute the full amount of
28 the claim dispute, plus all accrued interest, and shall be
29 considered a nonprevailing party for the purposes of this
30 section.
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1 (g) If, on an ongoing basis, during the preceding
2 12-month period, the resolution organization has reason to
3 believe that a pattern exists on the part of a particular
4 health plan or provider, the resolution organization shall
5 evaluate the information contained in these cases to determine
6 whether the information as to the timely processing of claims
7 evidences a pattern of violation of s. 627.6131 or s. 641.3155
8 and report its findings, together with substantiating
9 evidence, to the appropriate licensure or certification entity
10 for the health plan or provider.
11 (3) The agency shall adopt rules to establish a
12 process to be used by the resolution organization in
13 considering claim disputes submitted by a provider or health
14 plan managed care organization which must include the issuance
15 by the resolution organization of a written recommendation,
16 supported by findings of fact, to the agency within 60 days
17 after the requested information is received by the resolution
18 organization within the timeframes specified by the resolution
19 organization. In no event shall the review time exceed 90 days
20 following receipt of the initial claim dispute submission by
21 the resolution organization receipt of the claim dispute
22 submission.
23 (4) Within 30 days after receipt of the recommendation
24 of the resolution organization, the agency shall adopt the
25 recommendation as a final order.
26 (5) The agency shall notify within 7 days the
27 appropriate licensure or certification entity whenever there
28 is a violation of a final order issued by the agency pursuant
29 to this section.
30 (6)(5) The entity that does not prevail in the
31 agency's order must pay a review cost to the review
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1 organization, as determined by agency rule. Such rule must
2 provide for an apportionment of the review fee in any case in
3 which both parties prevail in part. If the nonprevailing party
4 fails to pay the ordered review cost within 35 days after the
5 agency's order, the nonpaying party is subject to a penalty of
6 not more than $500 per day until the penalty is paid.
7 (7)(6) The agency for Health Care Administration may
8 adopt rules to administer this section.
9 Section 2. Subsection (1) of section 626.88, Florida
10 Statutes, is amended to read:
11 626.88 Definitions of "administrator" and "insurer".--
12 (1) For the purposes of this part, an "administrator"
13 is any person who directly or indirectly solicits or effects
14 coverage of, collects charges or premiums from, or adjusts or
15 settles claims on residents of this state in connection with
16 authorized commercial self-insurance funds or with insured or
17 self-insured programs which provide life or health insurance
18 coverage or coverage of any other expenses described in s.
19 624.33(1), or any entity which provides provider billing and
20 collection services to health insurers and health maintenance
21 organizations on behalf of health care providers and, for
22 purposes of this section, such entities shall comply with the
23 provisions of ss. 627.6131, 641.3155, and 641.51(4), other
24 than any of the following persons:
25 (a) An employer on behalf of such employer's employees
26 or the employees of one or more subsidiary or affiliated
27 corporations of such employer.
28 (b) A union on behalf of its members.
29 (c) An insurance company which is either authorized to
30 transact insurance in this state or is acting as an insurer
31 with respect to a policy lawfully issued and delivered by such
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1 company in and pursuant to the laws of a state in which the
2 insurer was authorized to transact an insurance business.
3 (d) A health care services plan, health maintenance
4 organization, professional service plan corporation, or person
5 in the business of providing continuing care, possessing a
6 valid certificate of authority issued by the department, and
7 the sales representatives thereof, if the activities of such
8 entity are limited to the activities permitted under the
9 certificate of authority.
10 (e) An insurance agent licensed in this state whose
11 activities are limited exclusively to the sale of insurance.
12 (f) An adjuster licensed in this state whose
13 activities are limited to the adjustment of claims.
14 (g) A creditor on behalf of such creditor's debtors
15 with respect to insurance covering a debt between the creditor
16 and its debtors.
17 (h) A trust and its trustees, agents, and employees
18 acting pursuant to such trust established in conformity with
19 29 U.S.C. s. 186.
20 (i) A trust exempt from taxation under s. 501(a) of
21 the Internal Revenue Code, a trust satisfying the requirements
22 of ss. 624.438 and 624.439, or any governmental trust as
23 defined in s. 624.33(3), and the trustees and employees acting
24 pursuant to such trust, or a custodian and its agents and
25 employees, including individuals representing the trustees in
26 overseeing the activities of a service company or
27 administrator, acting pursuant to a custodial account which
28 meets the requirements of s. 401(f) of the Internal Revenue
29 Code.
30 (j) A financial institution which is subject to
31 supervision or examination by federal or state authorities or
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1 a mortgage lender licensed under chapter 494 who collects and
2 remits premiums to licensed insurance agents or authorized
3 insurers concurrently or in connection with mortgage loan
4 payments.
5 (k) A credit card issuing company which advances for
6 and collects premiums or charges from its credit card holders
7 who have authorized such collection if such company does not
8 adjust or settle claims.
9 (l) A person who adjusts or settles claims in the
10 normal course of such person's practice or employment as an
11 attorney at law and who does not collect charges or premiums
12 in connection with life or health insurance coverage.
13 (m) A person approved by the Division of Workers'
14 Compensation of the Department of Labor and Employment
15 Security who administers only self-insured workers'
16 compensation plans.
17 (n) A service company or service agent and its
18 employees, authorized in accordance with ss. 626.895-626.899,
19 serving only a single employer plan, multiple-employer welfare
20 arrangements, or a combination thereof.
21 (2) For the purposes of this part, an "insurer"
22 includes an authorized commercial self-insurance fund and
23 includes any person undertaking to provide life or health
24 insurance coverage or coverage of any of the other expenses
25 described in s. 624.33(1).
26 Section 3. Section 627.6131, Florida Statutes, is
27 created to read:
28 627.6131 Payment of claims.--
29 (1) The contract shall include the following
30 provision:
31
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1 "Time of Payment of Claims: After receiving
2 written proof of loss, the insurer will pay
3 monthly all benefits then due for ...(type of
4 benefit).... Benefits for any other loss
5 covered by this policy will be paid as soon as
6 the insurer receives proper written proof."
7
8 (2) As used in this section, the term "claim" for a
9 noninstitutional provider means a paper or electronic billing
10 instrument submitted to the insurer's designated location that
11 consists of the HCFA 1500 data set, or its successor, that has
12 all mandatory entries for a physician licensed under chapter
13 458, chapter 459, chapter 460, or chapter 461 or other
14 appropriate billing instrument that has all mandatory entries
15 for any other noninstitutional provider. For institutional
16 providers, "claim" means a paper or electronic billing
17 instrument submitted to the insurer's designated location that
18 consists of the UB-92 data set or its successor that has all
19 mandatory entries.
20 (3) All claims for payment, whether electronic or
21 nonelectronic:
22 (a) Are considered received on the date the claim is
23 received by the insurer at its designated claims receipt
24 location.
25 (b) Must be mailed or electronically transferred to an
26 insurer within 9 months after completion of the service and
27 the provider is furnished with the correct name and address of
28 the patient's health insurer.
29 (c) Must not duplicate a claim previously submitted
30 unless it is determined that the original claim was not
31 received or is otherwise lost.
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1 (4) For all electronically submitted claims, a health
2 insurer shall:
3 (a) Within 24 hours after the beginning of the next
4 business day after receipt of the claim, provide electronic
5 acknowledgment of the receipt of the claim to the electronic
6 source submitting the claim.
7 (b) Within 20 days after receipt of the claim, pay the
8 claim or notify a provider or designee if a claim is denied or
9 contested. Notice of the insurer's action on the claim and
10 payment of the claim is considered to be made on the date the
11 notice or payment was mailed or electronically transferred.
12 (c)1. Notification of the health insurer's
13 determination of a contested claim must be accompanied by an
14 itemized list of additional information or documents the
15 insurer can reasonably determine are necessary to process the
16 claim.
17 2. A provider must submit the additional information
18 or documentation, as specified on the itemized list, within 35
19 days after receipt of the notification. Failure of a provider
20 to submit by mail or electronically the additional information
21 or documentation requested within 35 days after receipt of the
22 notification may result in denial of the claim.
23 3. A health insurer may not make more than one request
24 for documents under this paragraph in connection with a claim,
25 unless the provider fails to submit all of the requested
26 documents to process the claim or if documents submitted by
27 the provider raise new additional issues not included in the
28 original written itemization, in which case the health insurer
29 may provide the provider with one additional opportunity to
30 submit the additional documents needed to process the claim.
31 In no case may the health insurer request duplicate documents.
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1 (d) For purposes of this subsection, electronic means
2 of transmission of claims, notices, documents, forms, and
3 payments shall be used to the greatest extent possible by the
4 health insurer and the provider.
5 (e) A claim must be paid or denied within 90 days
6 after receipt of the claim. Failure to pay or deny a claim
7 within 120 days after receipt of the claim creates an
8 uncontestable obligation to pay the claim.
9 (5) For all nonelectronically submitted claims, a
10 health insurer shall:
11 (a) Effective November 1, 2003, provide acknowledgment
12 of receipt of the claim within 15 days after receipt of the
13 claim to the provider or provide a provider within 15 days
14 after receipt with electronic access to the status of a
15 submitted claim.
16 (b) Within 40 days after receipt of the claim, pay the
17 claim or notify a provider or designee if a claim is denied or
18 contested. Notice of the insurer's action on the claim and
19 payment of the claim is considered to be made on the date the
20 notice or payment was mailed or electronically transferred.
21 (c)1. Notification of the health insurer's
22 determination of a contested claim must be accompanied by an
23 itemized list of additional information or documents the
24 insurer can reasonably determine are necessary to process the
25 claim.
26 2. A provider must submit the additional information
27 or documentation, as specified on the itemized list, within 35
28 days after receipt of the notification. Failure of a provider
29 to submit by mail or electronically the additional information
30 or documentation requested within 35 days after receipt of the
31 notification may result in denial of the claim.
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1 3. A health insurer may not make more than one request
2 for documents under this paragraph in connection with a claim
3 unless the provider fails to submit all of the requested
4 documents to process the claim or if documents submitted by
5 the provider raise new additional issues not included in the
6 original written itemization, in which case the health insurer
7 may provide the provider with one additional opportunity to
8 submit the additional documents needed to process the claim.
9 In no case may the health insurer request duplicate documents.
10 (d) For purposes of this subsection, electronic means
11 of transmission of claims, notices, documents, forms, and
12 payments shall be used to the greatest extent possible by the
13 health insurer and the provider.
14 (e) A claim must be paid or denied within 120 days
15 after receipt of the claim. Failure to pay or deny a claim
16 within 140 days after receipt of the claim creates an
17 uncontestable obligation to pay the claim.
18 (6) Payment of a claim is considered made on the date
19 the payment was mailed or electronically transferred. An
20 overdue payment of a claim bears simple interest of 12 percent
21 per year. Interest on an overdue payment for a claim or for
22 any portion of a claim begins to accrue when the claim should
23 have been paid, denied, or contested. The interest is payable
24 with the payment of the claim.
25 (7) If a health insurer determines that it has made an
26 overpayment to a provider for services rendered to an insured,
27 the health insurer must make a claim for such overpayment. A
28 health insurer that makes a claim for overpayment to a
29 provider under this section shall give the provider a written
30 or electronic statement specifying the basis for the
31 retroactive denial or payment adjustment. The insurer must
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1 identify the claim or claims, or overpayment claim portion
2 thereof, for which a claim for overpayment is submitted.
3 (a) If an overpayment determination is the result of
4 retroactive review or audit of coverage decisions or payment
5 levels not related to fraud, a health insurer shall adhere to
6 the following procedures:
7 1. All claims for overpayment must be submitted to a
8 provider within 30 months after the health insurer's payment
9 of the claim. A provider must pay, deny, or contest the health
10 insurer's claim for overpayment within 40 days after the
11 receipt of the claim. All contested claims for overpayment
12 must be paid or denied within 120 days after receipt of the
13 claim. Failure to pay or deny overpayment and claim within 140
14 days after receipt creates an uncontestable obligation to pay
15 the claim.
16 2. A provider that denies or contests a health
17 insurer's claim for overpayment or any portion of a claim
18 shall notify the health insurer, in writing, within 35 days
19 after the provider receives the claim that the claim for
20 overpayment is contested or denied. The notice that the claim
21 for overpayment is denied or contested must identify the
22 contested portion of the claim and the specific reason for
23 contesting or denying the claim and, if contested, must
24 include a request for additional information. If the health
25 insurer submits additional information, the health insurer
26 must, within 35 days after receipt of the request, mail or
27 electronically transfer the information to the provider. The
28 provider shall pay or deny the claim for overpayment within 45
29 days after receipt of the information. The notice is
30 considered made on the date the notice is mailed or
31 electronically transferred by the provider.
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1 3. Failure of a health insurer to respond to a
2 provider's contesting of claim or request for additional
3 information regarding the claim within 35 days after receipt
4 of such notice may result in denial of the claim.
5 4. The health insurer may not reduce payment to the
6 provider for other services unless the provider agrees to the
7 reduction in writing or fails to respond to the health
8 insurer's overpayment claim as required by this paragraph.
9 5. Payment of an overpayment claim is considered made
10 on the date the payment was mailed or electronically
11 transferred. An overdue payment of a claim bears simple
12 interest at the rate of 12 percent per year. Interest on an
13 overdue payment for a claim for an overpayment begins to
14 accrue when the claim should have been paid, denied, or
15 contested.
16 (b) A claim for overpayment shall not be permitted
17 beyond 30 months after the health insurer's payment of a
18 claim, except that claims for overpayment may be sought beyond
19 that time from providers convicted of fraud pursuant to s.
20 817.234.
21 (8) For all contracts entered into or renewed on or
22 after October 1, 2002, a health insurer's internal dispute
23 resolution process related to a denied claim not under active
24 review by a mediator, arbitrator, or third-party dispute
25 entity must be finalized within 60 days after the receipt of
26 the provider's request for review or appeal.
27 (9) A provider or any representative of a provider,
28 regardless of whether the provider is under contract with the
29 health insurer, may not collect or attempt to collect money
30 from, maintain any action at law against, or report to a
31 credit agency an insured for payment of covered services for
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1 which the health insurer contested or denied the provider's
2 claim. This prohibition applies during the pendency of any
3 claim for payment made by the provider to the health insurer
4 for payment of the services or internal dispute resolution
5 process to determine whether the health insurer is liable for
6 the services. For a claim, this pendency applies from the
7 date the claim or a portion of the claim is denied to the date
8 of the completion of the health insurer's internal dispute
9 resolution process, not to exceed 60 days.
10 (10) The provisions of this section may not be waived,
11 voided, or nullified by contract.
12 (11) A health insurer may not retroactively deny a
13 claim because of insured ineligibility more than 1 year after
14 the date of payment of the claim.
15 (12) A health insurer shall pay a contracted primary
16 care or admitting physician, pursuant to such physician's
17 contract, for providing inpatient services in a contracted
18 hospital to an insured if such services are determined by the
19 health insurer to be medically necessary and covered services
20 under the health insurer's contract with the contract holder.
21 (13) Upon written notification by an insured, an
22 insurer shall investigate any claim of improper billing by a
23 physician, hospital, or other health care provider. The
24 insurer shall determine if the insured was properly billed for
25 only those procedures and services that the insured actually
26 received. If the insurer determines that the insured has been
27 improperly billed, the insurer shall notify the insured and
28 the provider of its findings and shall reduce the amount of
29 payment to the provider by the amount determined to be
30 improperly billed. If a reduction is made due to such
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1 notification by the insured, the insurer shall pay to the
2 insured 20 percent of the amount of the reduction up to $500.
3 (14) A permissible error ratio of 5 percent is
4 established for insurer's claims payment violations of s.
5 627.6131(4)(a), (b), (c), and (e) and (5)(a), (b), (c), and
6 (e). If the error ratio of a particular insurer does not
7 exceed the permissible error ratio of 5 percent for an audit
8 period, no fine shall be assessed for the noted claims
9 violations for the audit period. The error ratio shall be
10 determined by dividing the number of claims with violations
11 found on a statistically valid sample of claims for the audit
12 period by the total number of claims in the sample. If the
13 error ratio exceeds the permissible error ratio of 5 percent,
14 a fine may be assessed according to s. 624.4211 for those
15 claims payment violations which exceed the error ratio.
16 Notwithstanding the provisions of this section, the department
17 may fine a health insurer for claims payment violations of s.
18 627.6131(4)(e) and (5)(e) which create an uncontestable
19 obligation to pay the claim. The department shall not fine
20 insurers for violations which the department determines were
21 due to circumstances beyond the insurer's control.
22 (15) This section is applicable only to a major
23 medical expense health insurance policy as defined in s.
24 627.643(2)(e) offered by a group or an individual health
25 insurer licensed pursuant to chapter 624, including a
26 preferred provider policy under s. 627.6471 and an exclusive
27 provider organization under s. 627.6472.
28 Section 4. Section 627.6135, Florida Statutes, is
29 created to read:
30 627.6135 Treatment authorization; payment of claims.--
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1 (1) For purposes of this section, "authorization"
2 consists of any requirement of a provider to obtain prior
3 approval or to provide documentation relating to the necessity
4 of a covered medical treatment or service as a condition for
5 reimbursement for the treatment or service prior to the
6 treatment or service. Each authorization request from a
7 provider must be assigned an identification number by the
8 health insurer.
9 (2) Upon receipt of a request from a provider for
10 authorization, the health insurer shall make a determination
11 within a reasonable time appropriate to medical circumstance
12 indicating whether the treatment or services are authorized.
13 For urgent care requests for which the standard timeframe for
14 the health insurer to make a determination would seriously
15 jeopardize the life or health of an insured or would
16 jeopardize the insured's ability to regain maximum function, a
17 health insurer must notify the provider as to its
18 determination as soon as possible taking into account medical
19 exigencies.
20 (3) Each response to an authorization request must be
21 assigned an identification number. Each authorization provided
22 by a health insurer must include the date of request of
23 authorization, a timeframe of the authorization, length of
24 stay if applicable, identification number of the
25 authorization, place of service, and type of service.
26 (4) A claim for treatment may not be denied if a
27 provider follows the health insurer's authorization procedures
28 and receives authorization for a covered service for an
29 eligible insured unless the provider provided information to
30 the health insurer with the intention to misinform the health
31 insurer.
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1 (5) A health insurer's requirements for authorization
2 for medical treatment or services and 30-day advance notice of
3 material change in such requirements must be provided to all
4 contracted providers and upon request to all noncontracted
5 providers. A health insurer that makes such requirements and
6 advance notices accessible to providers and insureds
7 electronically shall be deemed to be in compliance with this
8 subsection.
9 Section 5. Subsection (4) of section 627.651, Florida
10 Statutes, is amended to read:
11 627.651 Group contracts and plans of self-insurance
12 must meet group requirements.--
13 (4) This section does not apply to any plan which is
14 established or maintained by an individual employer in
15 accordance with the Employee Retirement Income Security Act of
16 1974, Pub. L. No. 93-406, or to a multiple-employer welfare
17 arrangement as defined in s. 624.437(1), except that a
18 multiple-employer welfare arrangement shall comply with ss.
19 627.419, 627.657, 627.6575, 627.6578, 627.6579, 627.6612,
20 627.66121, 627.66122, 627.6615, 627.6616, and 627.662(8)(6).
21 This subsection does not allow an authorized insurer to issue
22 a group health insurance policy or certificate which does not
23 comply with this part.
24 Section 6. Section 627.662, Florida Statutes, is
25 amended to read:
26 627.662 Other provisions applicable.--The following
27 provisions apply to group health insurance, blanket health
28 insurance, and franchise health insurance:
29 (1) Section 627.569, relating to use of dividends,
30 refunds, rate reductions, commissions, and service fees.
31
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1 (2) Section 627.602(1)(f) and (2), relating to
2 identification numbers and statement of deductible provisions.
3 (3) Section 627.635, relating to excess insurance.
4 (4) Section 627.638, relating to direct payment for
5 hospital or medical services.
6 (5) Section 627.640, relating to filing and
7 classification of rates.
8 (6) Section 627.613, relating to timely payment of
9 claims, or s. 627.6131, relating to payment of claims.
10 (7) Section 627.6135, relating to treatment
11 authorizations and payment of claims.
12 (8)(6) Section 627.645(1), relating to denial of
13 claims.
14 (9)(7) Section 627.613, relating to time of payment of
15 claims.
16 (10)(8) Section 627.6471, relating to preferred
17 provider organizations.
18 (11)(9) Section 627.6472, relating to exclusive
19 provider organizations.
20 (12)(10) Section 627.6473, relating to combined
21 preferred provider and exclusive provider policies.
22 (13)(11) Section 627.6474, relating to provider
23 contracts.
24 Section 7. Subsection (2) of section 627.638, Florida
25 Statutes, is amended to read:
26 627.638 Direct payment for hospital, medical
27 services.--
28 (2) Whenever, in any health insurance claim form, an
29 insured specifically authorizes payment of benefits directly
30 to any recognized hospital or physician, the insurer shall
31 make such payment to the designated provider of such services,
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1 unless otherwise provided in the insurance contract. However,
2 if:
3 (a) The benefit is determined to be covered under the
4 terms of the policy;
5 (b) The claim is limited to treatment of mental health
6 or substance abuse, including drug and alcohol abuse; and
7 (c) The insured authorizes the insurer, in writing, as
8 part of the claim to make direct payment of benefits to a
9 recognized hospital, physician, or other licensed provider,
10
11 payments shall be made directly to the recognized hospital,
12 physician, or other licensed provider, notwithstanding any
13 contrary provisions in the insurance contract.
14 Section 8. Subsection (1) of section 641.30, Florida
15 Statutes, is amended to read:
16 641.30 Construction and relationship to other laws.--
17 (1) Every health maintenance organization shall accept
18 the standard health claim form prescribed pursuant to s.
19 641.3155 627.647.
20 Section 9. Subsection (4) of section 641.3154, Florida
21 Statutes, is amended to read:
22 641.3154 Organization liability; provider billing
23 prohibited.--
24 (4) A provider or any representative of a provider,
25 regardless of whether the provider is under contract with the
26 health maintenance organization, may not collect or attempt to
27 collect money from, maintain any action at law against, or
28 report to a credit agency a subscriber of an organization for
29 payment of services for which the organization is liable, if
30 the provider in good faith knows or should know that the
31 organization is liable. This prohibition applies during the
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1 pendency of any claim for payment made by the provider to the
2 organization for payment of the services and any legal
3 proceedings or dispute resolution process to determine whether
4 the organization is liable for the services if the provider is
5 informed that such proceedings are taking place. It is
6 presumed that a provider does not know and should not know
7 that an organization is liable unless:
8 (a) The provider is informed by the organization that
9 it accepts liability;
10 (b) A court of competent jurisdiction determines that
11 the organization is liable; or
12 (c) The department or agency makes a final
13 determination that the organization is required to pay for
14 such services subsequent to a recommendation made by the
15 Statewide Provider and Subscriber Assistance Panel pursuant to
16 s. 408.7056; or
17 (d) The agency issues a final order that the
18 organization is required to pay for such services subsequent
19 to a recommendation made by a resolution organization pursuant
20 to s. 408.7057.
21 Section 10. Section 641.3155, Florida Statutes, is
22 amended to read:
23 (Substantial rewording of section. See
24 s. 641.3155, F.S., for present text.)
25 641.3155 Prompt payment of claims.--
26 (1) As used in this section, the term "claim" for a
27 noninstitutional provider means a paper or electronic billing
28 instrument submitted to the health maintenance organization's
29 designated location that consists of the HCFA 1500 data set,
30 or its successor, that has all mandatory entries for a
31 physician licensed under chapter 458, chapter 459, chapter
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1 460, or chapter 461 or other appropriate billing instrument
2 that has all mandatory entries for any other noninstitutional
3 provider. For institutional providers, "claim" means a paper
4 or electronic billing instrument submitted to the health
5 maintenance organization's designated location that consists
6 of the UB-92 data set or its successor that has all mandatory
7 entries.
8 (2) All claims for payment, whether electronic or
9 nonelectronic:
10 (a) Are considered received on the date the claim is
11 received by the organization at its designated claims receipt
12 location.
13 (b) Must be mailed or electronically transferred to an
14 organization within 9 months after completion of the service
15 and the provider is furnished with the correct name and
16 address of the patient's health insurer.
17 (c) Must not duplicate a claim previously submitted
18 unless it is determined that the original claim was not
19 received or is otherwise lost.
20 (3) For all electronically submitted claims, a health
21 maintenance organization shall:
22 (a) Within 24 hours after the beginning of the next
23 business day after receipt of the claim, provide electronic
24 acknowledgment of the receipt of the claim to the electronic
25 source submitting the claim.
26 (b) Within 20 days after receipt of the claim, pay the
27 claim or notify a provider or designee if a claim is denied or
28 contested. Notice of the organization's action on the claim
29 and payment of the claim is considered to be made on the date
30 the notice or payment was mailed or electronically
31 transferred.
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1 (c)1. Notification of the health maintenance
2 organization's determination of a contested claim must be
3 accompanied by an itemized list of additional information or
4 documents the insurer can reasonably determine are necessary
5 to process the 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 maintenance organization may not make more
13 than one request for documents under this paragraph in
14 connection with a claim, unless the provider fails to submit
15 all of the requested documents to process the claim or if
16 documents submitted by the provider raise new additional
17 issues not included in the original written itemization, in
18 which case the health maintenance organization may provide the
19 provider with one additional opportunity to submit the
20 additional documents needed to process the claim. In no case
21 may the health maintenance organization request duplicate
22 documents.
23 (d) For purposes of this subsection, electronic means
24 of transmission of claims, notices, documents, forms, and
25 payment shall be used to the greatest extent possible by the
26 health maintenance organization and the provider.
27 (e) A claim must be paid or denied within 90 days
28 after receipt of the claim. Failure to pay or deny a claim
29 within 120 days after receipt of the claim creates an
30 uncontestable obligation to pay the claim.
31
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1 (4) For all nonelectronically submitted claims, a
2 health maintenance organization shall:
3 (a) Effective November 1, 2003, provide
4 acknowledgement of receipt of the claim within 15 days after
5 receipt of the claim to the provider or designee or provide a
6 provider or designee within 15 days after receipt with
7 electronic access to the status of a submitted claim.
8 (b) Within 40 days after receipt of the claim, pay the
9 claim or notify a provider or designee if a claim is denied or
10 contested. Notice of the health maintenance organization's
11 action on the claim and payment of the claim is considered to
12 be made on the date the notice or payment was mailed or
13 electronically transferred.
14 (c)1. Notification of the health maintenance
15 organization's determination of a contested claim must be
16 accompanied by an itemized list of additional information or
17 documents the organization can reasonably determine are
18 necessary to process the claim.
19 2. A provider must submit the additional information
20 or documentation, as specified on the itemized list, within 35
21 days after receipt of the notification. Failure of a provider
22 to submit by mail or electronically the additional information
23 or documentation requested within 35 days after receipt of the
24 notification may result in denial of the claim.
25 3. A health maintenance organization may not make more
26 than one request for documents under this paragraph in
27 connection with a claim unless the provider fails to submit
28 all of the requested documents to process the claim or if
29 documents submitted by the provider raise new additional
30 issues not included in the original written itemization, in
31 which case the health maintenance organization may provide the
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1 provider with one additional opportunity to submit the
2 additional documents needed to process the claim. In no case
3 may the health maintenance organization request duplicate
4 documents.
5 (d) For purposes of this subsection, electronic means
6 of transmission of claims, notices, documents, forms, and
7 payments shall be used to the greatest extent possible by the
8 health maintenance organization and the provider.
9 (e) A claim must be paid or denied within 120 days
10 after receipt of the claim. Failure to pay or deny a claim
11 within 140 days after receipt of the claim creates an
12 uncontestable obligation to pay the claim.
13 (5) Payment of a claim is considered made on the date
14 the payment was mailed or electronically transferred. An
15 overdue payment of a claim bears simple interest of 12 percent
16 per year. Interest on an overdue payment for a claim or for
17 any portion of a claim begins to accrue when the claim should
18 have been paid, denied, or contested. The interest is payable
19 with the payment of the claim.
20 (6) If a health maintenance organization determines
21 that it has made an overpayment to a provider for services
22 rendered to a subscriber, the health maintenance organization
23 must make a claim for such overpayment. A health maintenance
24 organization that makes a claim for overpayment to a provider
25 under this section shall give the provider a written or
26 electronic statement specifying the basis for the retroactive
27 denial or payment adjustment. The health maintenance
28 organization must identify the claim or claims, or overpayment
29 claim portion thereof, for which a claim for overpayment is
30 submitted.
31
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1 (a) If an overpayment determination is the result of
2 retroactive review or audit of coverage decisions or payment
3 levels not related to fraud, a health maintenance organization
4 shall adhere to the following procedures:
5 1. All claims for overpayment must be submitted to a
6 provider within 30 months after the health maintenance
7 organization's payment of the claim. A provider must pay,
8 deny, or contest the health maintenance organization's claim
9 for overpayment within 40 days after the receipt of the claim.
10 All contested claims for overpayment must be paid or denied
11 within 120 days after receipt of the claim. Failure to pay or
12 deny overpayment and claim within 140 days after receipt
13 creates an uncontestable obligation to pay the claim.
14 2. A provider that denies or contests a health
15 maintenance organization's claim for overpayment or any
16 portion of a claim shall notify the organization, in writing,
17 within 35 days after the provider receives the claim that the
18 claim for overpayment is contested or denied. The notice that
19 the claim for overpayment is denied or contested must identify
20 the contested portion of the claim and the specific reason for
21 contesting or denying the claim and, if contested, must
22 include a request for additional information. If the
23 organization submits additional information, the organization
24 must, within 35 days after receipt of the request, mail or
25 electronically transfer the information to the provider. The
26 provider shall pay or deny the claim for overpayment within 45
27 days after receipt of the information. The notice is
28 considered made on the date the notice is mailed or
29 electronically transferred by the provider.
30 3. Failure of a health maintenance organization to
31 respond to a provider's contestment of claim or request for
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1 additional information regarding the claim within 35 days
2 after receipt of such notice may result in denial of the
3 claim.
4 4. The health maintenance organization may not reduce
5 payment to the provider for other services unless the provider
6 agrees to the reduction in writing or fails to respond to the
7 health maintenance organization's overpayment claim as
8 required by this paragraph.
9 5. Payment of an overpayment claim is considered made
10 on the date the payment was mailed or electronically
11 transferred. An overdue payment of a claim bears simple
12 interest at the rate of 12 percent per year. Interest on an
13 overdue payment for a claim for an overpayment payment begins
14 to accrue when the claim should have been paid, denied, or
15 contested.
16 (b) A claim for overpayment shall not be permitted
17 beyond 30 months after the health maintenance organization's
18 payment of a claim, except that claims for overpayment may be
19 sought beyond that time from providers convicted of fraud
20 pursuant to s. 817.234.
21 (7)(a) For all contracts entered into or renewed on or
22 after October 1, 2002, a health maintenance organization's
23 internal dispute resolution process related to a denied claim
24 not under active review by a mediator, arbitrator, or
25 third-party dispute entity must be finalized within 60 days
26 after the receipt of the provider's request for review or
27 appeal.
28 (b) All claims to a health maintenance organization
29 begun after October 1, 2000, not under active review by a
30 mediator, arbitrator, or third-party dispute entity, shall
31 result in a final decision on the claim by the health
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1 maintenance organization by January 2, 2003, for the purpose
2 of the statewide provider and managed care organization claim
3 dispute resolution program pursuant to s. 408.7057.
4 (8) A provider or any representative of a provider,
5 regardless of whether the provider is under contract with the
6 health maintenance organization, may not collect or attempt to
7 collect money from, maintain any action at law against, or
8 report to a credit agency a subscriber for payment of covered
9 services for which the health maintenance organization
10 contested or denied the provider's claim. This prohibition
11 applies during the pendency of any claim for payment made by
12 the provider to the health maintenance organization for
13 payment of the services or internal dispute resolution process
14 to determine whether the health maintenance organization is
15 liable for the services. For a claim, this pendency applies
16 from the date the claim or a portion of the claim is denied to
17 the date of the completion of the health maintenance
18 organization's internal dispute resolution process, not to
19 exceed 60 days.
20 (9) The provisions of this section may not be waived,
21 voided, or nullified by contract.
22 (10) A health maintenance organization may not
23 retroactively deny a claim because of subscriber ineligibility
24 more than 1 year after the date of payment of the claim.
25 (11) A health maintenance organization shall pay a
26 contracted primary care or admitting physician, pursuant to
27 such physician's contract, for providing inpatient services in
28 a contracted hospital to a subscriber if such services are
29 determined by the health maintenance organization to be
30 medically necessary and covered services under the health
31 maintenance organization's contract with the contract holder.
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1 (12) Upon written notification by a subscriber, a
2 health maintenance organization shall investigate any claim of
3 improper billing by a physician, hospital, or other health
4 care provider. The organization shall determine if the
5 subscriber was properly billed for only those procedures and
6 services that the subscriber actually received. If the
7 organization determines that the subscriber has been
8 improperly billed, the organization shall notify the
9 subscriber and the provider of its findings and shall reduce
10 the amount of payment to the provider by the amount determined
11 to be improperly billed. If a reduction is made due to such
12 notification by the insured, the insurer shall pay to the
13 insured 20 percent of the amount of the reduction up to $500.
14 (13) A permissible error ratio of 5 percent is
15 established for health maintenance organizations' claims
16 payment violations of s. 641.3155(3)(a), (b), (c), and (e) and
17 (4)(a), (b), (c), and (e). If the error ratio of a particular
18 insurer does not exceed the permissible error ratio of 5
19 percent for an audit period, no fine shall be assessed for the
20 noted claims violations for the audit period. The error ratio
21 shall be determined by dividing the number of claims with
22 violations found on a statistically valid sample of claims for
23 the audit period by the total number of claims in the sample.
24 If the error ratio exceeds the permissible error ratio of 5
25 percent, a fine may be assessed according to s. 624.4211 for
26 those claims payment violations which exceed the error ratio.
27 Notwithstanding the provisions of this section, the department
28 may fine a health maintenance organization for claims payment
29 violations of s. 641.3155(3)(e) and (4)(e) which create an
30 uncontestable obligation to pay the claim. The department
31 shall not fine organizations for violations which the
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1 department determines were due to circumstances beyond the
2 organization's control.
3 Section 11. Section 641.3156, Florida Statutes, is
4 amended to read:
5 641.3156 Treatment authorization; payment of claims.--
6 (1) For purposes of this section, "authorization"
7 consists of any requirement of a provider to obtain prior
8 approval or to provide documentation relating to the necessity
9 of a covered medical treatment or service as a condition for
10 reimbursement for the treatment or service prior to the
11 treatment or service. Each authorization request from a
12 provider must be assigned an identification number by the
13 health maintenance organization A health maintenance
14 organization must pay any hospital-service or referral-service
15 claim for treatment for an eligible subscriber which was
16 authorized by a provider empowered by contract with the health
17 maintenance organization to authorize or direct the patient's
18 utilization of health care services and which was also
19 authorized in accordance with the health maintenance
20 organization's current and communicated procedures, unless the
21 provider provided information to the health maintenance
22 organization with the willful intention to misinform the
23 health maintenance organization.
24 (2) A claim for treatment may not be denied if a
25 provider follows the health maintenance organization's
26 authorization procedures and receives authorization for a
27 covered service for an eligible subscriber, unless the
28 provider provided information to the health maintenance
29 organization with the willful intention to misinform the
30 health maintenance organization.
31
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1 (3) Upon receipt of a request from a provider for
2 authorization, the health maintenance organization shall make
3 a determination within a reasonable time appropriate to
4 medical circumstance indicating whether the treatment or
5 services are authorized. For urgent care requests for which
6 the standard timeframe for the health maintenance organization
7 to make a determination would seriously jeopardize the life or
8 health of a subscriber or would jeopardize the subscriber's
9 ability to regain maximum function, a health maintenance
10 organization must notify the provider as to its determination
11 as soon as possible taking into account medical exigencies.
12 (4) Each response to an authorization request must be
13 assigned an identification number. Each authorization provided
14 by a health maintenance organization must include the date of
15 request of authorization, timeframe of the authorization,
16 length of stay if applicable, identification number of the
17 authorization, place of service, and type of service.
18 (5) A health maintenance organization's requirements
19 for authorization for medical treatment or services and 30-day
20 advance notice of material change in such requirements must be
21 provided to all contracted providers and upon request to all
22 noncontracted providers. A health maintenance organization
23 that makes such requirements and advance notices accessible to
24 providers and subscribers electronically shall be deemed to be
25 in compliance with this paragraph.
26 (6)(3) Emergency services are subject to the
27 provisions of s. 641.513 and are not subject to the provisions
28 of this section.
29 Section 12. Except as otherwise provided herein, this
30 act shall take effect October 1, 2002, and shall apply to
31 claims for services rendered after such date.
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