June 2002 Bulletin

In Brief


Legislation passed both Houses and was signed by Gov. Bill Owens that amends current law by requiring the state to delineate what elements must be filled out on a claim for it to be considered clean. Penalties for late payment can be paid by insurers quarterly or when the total reaches $10. Carriers must accept electronic claims.


Gov. John G. Rowland signed a bill requiring hospitals and surgical centers to report to the state within 24-hours all adverse events (accidents that kill, seriously injure or endanger patients). It has not been determined if the names of the participating physicians will be reported as well. Reports will be available to the public six months after the "adverse event."


Delaware lawmakers have introduced legislation that would limit non-economic awards to $250,000 in medical malpractice cases. Supporters of the bill say the cap on the awards will help doctors afford malpractice insurance and keep some physicians in the medical profession. During the past six months, premiums for malpractice insurance have doubled in some cases, according to the Delaware Health Care Association. Four major medical insurance companies have left or are leaving Delaware and another carrier has stopped issuing new policies. That leaves two major carriers in the state, according to the association. The Delaware Trial Lawyers Association opposes the legislation. The measure, House Bill 502, has been sent the Economic Development/Insurance and Banking Committee.


Gov. Jeb Bush signed into law a bill that strengthens statutory prompt-pay requirements for PPOs and HMOs, as well as other insurers. The prompt-pay provisions of the bill, which also expand the state’s claims dispute resolution program to include major medical expense health insurance policies and PPOs, will take effect Oct. 1. The bill requires that HMOs and insurers pay, deny, or contest a provider’s reimbusement claim within 20 days for electronic submissions and within 40 days for nonelectronic submissions


A bill passed both Houses allowing chiropractors to call themselves chiropractic physicians and send specimens for lab tests. The bill also expands the scope of chiropractic practice from only the spine to the entire body. The body is defined as the spinal column; the head including the temporomandibular joint, but excluding the atlanto-occipital; the lower and upper extremities; the rib cage, limited to the anterior region, but excluding the costotransverse and costovertebral joints; and the abdomen. Gov. Benjamin J. Caetano also signed legislation that continues the prompt payment law. The bill requires plans to offer a system whereby providers can check enrollee eligibility. Interest penalties under $2.00 do not have to be paid on late claims.


New legislation that would allow physicians to take income tax deductions for certain unreimbursed care was introduced. If a physician voluntarily treats patients at a community health clinic, the physician can deduct the losses for such care. Deductions will also be allowed for losses sustained for treatment of unreferred emergency room indigent patients. The patient must have an income less than 100 percent of the federal poverty line and not have private insurance or be eligible for government insurance. A similar bill allows deductions for losses for all treatment to indigent patients.


Two prompt payment bills were signed into law by Lt. Gov. Dick Posthumus on May 17 in the absence of Gov. John Engler, who was in Europe. Gov. Engler, vetoed the prompt pay legislation last year. The legislation states that a clean claim must be paid within 45 days. If the claim isn’t paid within 45 days, a 12 percent penalty can be collected. If unjustified delays continue, the laws allow the state insurance commissioner to impose fines of up to $10,000.


Gov. Ronnie Musgrove signed prompt pay legislation that reduces the time period for paying clean claims to 35 days for paper claims and 25 days for electronic claims, defines a clean claim and gives the state the ability to fine insurers who violate the law.

New Hampshire

A bill passed allowing insurers to retroactively deny paid claims within 28 months from payment of the claim. The reason for the denial must be given to the physician in writing.

New York

The state fined 22 carriers a total of $4 million in April for violating the prompt payment law. Oxford Health Plan was fined $918,000 and U.S. Healthcare was fined $751,650.


Legislation was signed allowing chiropractors to order lab tests and prohibiting discrimination against podiatrists by HMOs. Also signed into law was legislation that requires health insurance carriers to provide a schedule of fees to health care providers entering into or renewing a contract of service. The schedule must include a description of the payment process, considerations that affect the payment process and would require insurers to provide examples of payments and procedures for medical procedures frequently performed. The bill would require that any change in the fee schedule be made available to providers at least 30 days prior to the change being enacted.


Thirteen carriers in the state agreed to $2.77 million in fines for prompt payment violations, in addition to the $7 million in restitution paid to physicians. The largest fine, $575,000, was levied against Metropolitan Life Insurance Co. Warning that soaring professional liability insurance premiums are threatening Texas health care, Gov. Rick Perry proposed a cap on "pain and suffering" awards in professional liability lawsuits of $250,000 and a limit on fees a personal injury trial lawyer can collect as a portion of an award.

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