093_HB3581

 
                                     LRB093 03726 JLS 03756 b

 1        AN ACT concerning health care benefit claims.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The Illinois Insurance  Code  is  amended  by
 5    changing Section 368a as follows:

 6        (215 ILCS 5/368a)
 7        Sec. 368a.  Timely payment for health care services.
 8        (a)  This  subsection Section applies to insurers, health
 9    maintenance organizations, managed care  plans,  health  care
10    plans,   preferred   provider   organizations,   third  party
11    administrators,  independent   practice   associations,   and
12    physician-hospital  organizations (hereinafter referred to as
13    "payors") that provide periodic payments, which are  payments
14    not  requiring  a  claim, bill, capitation encounter data, or
15    capitation  reconciliation  reports,  such   as   prospective
16    capitation  payments, to health care professionals and health
17    care facilities to provide medical or  health  care  services
18    for insureds or enrollees.
19             (1)  A   payor   shall  make  periodic  payments  in
20        accordance with  item  (3).   Failure  to  make  periodic
21        payments  within the period of time specified in item (3)
22        shall entitle the health care professional or health care
23        facility to interest at the rate of 9% per year from  the
24        date  payment  was required to be made to the date of the
25        late payment,  provided  that  any  aggregate  amount  of
26        interest amounting to less than $1 need not be paid.  Any
27        required  interest  payments shall be made within 30 days
28        after the payment.
29             (2)  When a payor requires  selection  of  a  health
30        care  professional or health care facility, the selection
31        shall be completed by the insured or  enrollee  no  later
 
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 1        than  30  days after enrollment.  The payor shall provide
 2        written notice of this requirement to  all  insureds  and
 3        enrollees.  Nothing in this Section shall be construed to
 4        require a payor to select a health care  professional  or
 5        health care facility for an insured or enrollee.
 6             (3)  A   payor   shall   provide   the  health  care
 7        professional or health care facility with notice  of  the
 8        selection  as  a  health care professional or health care
 9        facility by an insured or enrollee and the effective date
10        of the  selection  within  60  calendar  days  after  the
11        selection.  No later than the 60th day following the date
12        an  insured  or  enrollee  has  selected  a  health  care
13        professional  or  health  care  facility or the date that
14        selection becomes effective, whichever is  later,  or  in
15        cases  of  retrospective  enrollment  only, 30 days after
16        notice by an employer to the payor of  the  selection,  a
17        payor  shall  begin  periodic  payment  of  the  required
18        amounts  to  the  insured's  or  enrollee's  health  care
19        professional  or health care facility, or the designee of
20        either, calculated from the date of selection or the date
21        the selection becomes effective, whichever is later.  All
22        subsequent  payments  shall  be made in accordance with a
23        monthly periodic cycle.
24        (b)  Notwithstanding any other provision of this Section,
25    independent  practice  associations  and   physician-hospital
26    organizations  shall  make  periodic  payment of the required
27    amounts in accordance with a monthly periodic schedule  after
28    an   insured   or   enrollee   has  selected  a  health  care
29    professional or health care facility or after that  selection
30    becomes effective, whichever is later.
31        Notwithstanding  any  other  provision  of  this Section,
32    independent  practice  associations  and   physician-hospital
33    organizations  shall  make  all  other  payments  for  health
34    services  within  30 days after receipt of due proof of loss.
 
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 1    Independent  practice  associations  and   physician-hospital
 2    organizations  shall  notify the insured, insured's assignee,
 3    health care professional, or  health  care  facility  of  any
 4    failure  to  provide sufficient documentation for a due proof
 5    of loss within 30 days after receipt of the claim for  health
 6    services.
 7        Failure  to  pay  within  the  required time period shall
 8    entitle the payee to interest at the rate of 9% per year from
 9    the date the payment is due to the date of the late  payment,
10    provided  that  any aggregate amount of interest amounting to
11    less that  $1  need  not  be  paid.   Any  required  interest
12    payments shall be made within 30 days after the payment.
13        (c)  All   insurers,  health  maintenance  organizations,
14    managed care plans, health  care  plans,  preferred  provider
15    organizations,  and  third  party administrators shall ensure
16    that  all  claims  and  indemnities  concerning  health  care
17    services other than for any periodic payment  shall  be  paid
18    within  30  days  after  receipt of due written proof of such
19    loss.   An   insured,   insured's   assignee,   health   care
20    professional, or health care facility shall  be  notified  of
21    any  known  failure to provide sufficient documentation for a
22    due proof of loss within 30 days after receipt of  the  claim
23    for  health  care services. Failure to pay within such period
24    shall entitle the payee to interest at the  rate  of  9%  per
25    year from the 30th day after receipt of such proof of loss to
26    the  date of late payment, provided that any aggregate amount
27    of interest amounting to less than one  dollar  need  not  be
28    paid.  Any required interest payments shall be made within 30
29    days after the payment.
30        (d)  The  Department shall enforce the provisions of this
31    Section pursuant to the enforcement powers granted to  it  by
32    law.
33        (e)  The  Department is hereby granted specific authority
34    to issue  a  cease  and  desist  order,  fine,  or  otherwise
 
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 1    penalize   any   entity,   including,  but  not  limited  to,
 2    independent  practice  associations  and   physician-hospital
 3    organizations,   that  violates  violate  this  Section.  The
 4    Department shall adopt reasonable rules to enforce compliance
 5    with this Section by all entities including, but not  limited
 6    to,  independent practice associations and physician-hospital
 7    organizations.
 8        (f)  For the purposes of  this  Section,  "due  proof  of
 9    loss" means a clean claim.  A claim shall be considered clean
10    when it contains all of the following:
11             (1)  The name of the patient.
12             (2)  The  patient's insurance information, including
13        company name and number.
14             (3)  The date service was provided.
15             (4)  The  professional  or  provider  identification
16        number.
17             (5)  Codes for the services provided.
18             (6)  The charge for each service code.
19        (g)  Medical records are not required for a claim  to  be
20    considered  clean.   Medical  records  may  be  requested for
21    claims that involve multiple  surgical  procedures,  surgical
22    assistants,  and  the use of CPT code modifiers.  A physician
23    or provider may charge payors the rates set forth in  Section
24    8-2003 of the Code of Civil Procedure for requested copies of
25    records.
26    (Source: P.A.  91-605,  eff.  12-14-99;  91-788, eff. 6-9-00;
27    92-745, eff. 1-1-03.)

28        Section 99.  Effective date.  This Act  takes  effect  on
29    December 1, 2003.