April 1998 Bulletin

Texas warns HMOs to pay promptly

The Texas Insurance Commissioner has reminded health maintenance organizations that state law requires them to pay their members' first-party claims promptly or risk being subjected to penalities.

The prompt payment law, enacted in 1991 and strengthened in 1997, gives HMOs and insurers 15 days after claims are received to acknowledge the claims, begin investigations and request needed information.

Claimants must be notified in writing of acceptance or rejection of their claims within 15 days of receiving all required information. The reasons for rejecting claims must be submitted in writing. payments must be made within five business days after notifying claimants that their claims will be paid.

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