Prompt Payment to Providers
Patricia Brewer, HMO Projects Director
Cady Crismon, MSN, RN, Director, HMO Quality Assurance
When Does a Company Have to Pay a Claim for a Health Service?
- Texas law provides different requirements depending upon:
- Type of coverage - HMO vs. PPO vs. Non-network Indemnity
- Who filed the claim - Insured, Enrollee, Physician, or Provider
- Status of physician or provider - Contracted vs. Non-contracted
Clean Claim Rules
Meant to implement and clarify HB 610 passed during 1999 legislative session
- Apply to:
- HMOs
- PPOs
- Contracted Physicians and Providers
- Effective for:
- Claims filed for outpatient care received on or after 8/1/00
- Claims filed for inpatient stays that began on or after 8/1/00
- Clean Claim Rules
- Perform three main functions:
- Define elements of a clean claim
- Clarify when the prompt payment period clock starts running
- Clarify the required actions of a carrier upon receipt of a clean claim
What is a Clean Claim?
- Data elements - see handouts
- HCFA 1500
- UB-92
- Attachments
- Additional clean claim elements
- Format
- Legible, accurate, complete
- Too much information does not render an otherwise clean claim deficient!
Proof of Claims Submission
- Return receipt
- Electronic confirmation
- Fax confirmation
What are the Carrier´s Responsibilities?
- Notice of revised or additional data elements and/or attachments. Disclosure may be made by:
- Written notice at least 60 days prior to requiring additional or revised information
- Revision of physician or provider manual at least 60 days prior to requiring additional or revised information
- Contract provisions
- Act on clean claims within 45-day statutory claims processing period
- Pay the claim, in total, in accordance with the contract
- Deny the claim in total and notify the physician or provider in writing of the reason for denial
- Pay portion and deny portion, and notify physician or provider in writing of reason for denial
- Pay portion and audit portion, notify physician or provider in writing that claim is being audited, and pay 85% of the contracted rate on the audited portion
- Audit entire claim, notify physician or provider in writing that claim is being audited, and pay 85% of the contracted rate
- Notice of deficient claims within 45 days
- Notice of changes in claims addresses, processors, etc.
Audits
- Carrier acknowledges coverage of an enrollee, but claim processing takes longer than the 45-day statutory claim processing period
- The rule does not specify a time limit for audit completion
- After the audit is completed the carrier must give written notice of the results and pay the additional 15% balance of contracted rate 30 days after the audit is completed
- A physician or provider must refund the 85% audit payment:
- 30 days after the later of (a) receiving notice of audit results, or (b) exhaustion of enrollee's appeal rights, if appealed within 30-day refund period
- Chargebacks are allowed with written notice and opportunity to arrange an alternative reimbursement method
Penalties if Carriers Fail to Comply with the Clean Claim Rules
- Full amount of billed charges up to U&C charges, or
- Contracted penalty rate provided for in the physician or provider's contract
- Administrative penalties, up to $1,000/day per claim, may be assessed and collected by the State of Texas
Date of Claim Payment
- Claim is considered to have been paid on the date of:
- U.S. Postal Service postmark
- Electronic transmission
- Delivery of the claim payment to a commercial carrier, such as UPS or Federal Express, or
- Receipt by the physician or provider, if a claim payment is made other than provided above
Coordination of Benefits
- The amount(s) paid by primary carrier(s) is a clean claim element for secondary carriers
- The statutory claim processing period for secondary carriers does not begin until primary payor information is provided
TDI Complaint Process
- Consumer Protection - PPO/Indemnity
- HMO Quality Assurance Section - HMO
- Complaints are reviewed and assigned
- Carriers have 10 days to respond to TDI inquiries, per Texas Insurance Code Article 38.001
All HMO Complaints Closed
Fiscal Year 2000
PPO Complaints Closed
Fiscal Year 2000
Scenario #1
- DOS 2/2/00 with contracted provider
- Claim billed 10 days after DOS via certified mail, received by carrier on 2/16/00
- Claim processed and paid at contracted rate on 3/20/00
- Clean claim violation?
Scenario #2
- DOS 11/16/00 through 11/22/00 in contracted facility
- Inpatient authorization received for all days
- Billed carrier via electronic submission on 11/29/00
- Claim denied on 3/1/01 due to medical records not submitted
- Failed to make denial within 45 days
- Clean claim violation?
Scenario #3
- ER DOS 10/4/00
- Facility is a contracted provider
- Billed carrier at end of month, submitted claim via certified mail, received by carrier on 11/20/00
- ER followed up on unpaid claim on 2/1/01
- Clean claim violation?
Scenario #4
- Contracted provider filed clean claim with multiple CPT codes for DOS 5/1/01
- Carrier notified provider of audit, in writing, within 45 days, paying 85% of contracted rate for each CPT code
- Completed audit within 60 days and paid provider remaining 15% of contracted rate
- Clean claim violation?
Scenario #5
- Office visit with contracted physician, DOS 5/5/01
- Physician billed for multiple CPT codes for this office visit
- Carrier deducted copay on each CPT code, but paid within 45 days
- Clean claim violation?
Scenario #6
- DOS 1/15/01 with contracted provider
- Provider submitted clean claim via electronic submission
- Carrier processed and paid claims within 30 days, but paid at incorrect contract rate
- Provider appealed payment twice, then filed complaint with TDI
- Carrier responded that they had incorrectly paid claim and then paid the difference between the incorrect rate and the contracted rate
- Carrier refused to pay billed charges
- Clean claim violation?
Resources
- Website:
- Provider Ombudsman
- Audrey Selden, Senior Associate Commissioner
- (512) 475-1760
- Toll Free Information
- 1-800-252-3439
For more information contact:
Last updated: 01/14/2013
