Prompt Payment to Providers

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Texas
Department of Insurance
Jose Montemayor, Commissioner
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Prompt Payment to Providers28 TAC
21.2801-21.2816

• Patricia Brewer, HMO Projects Director
• Cady Crismon, MSN, RN, Director, HMO Quality
  Assurance
• Texas Department of Insurance

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Who Does Not Have to Comply?

• Self-funded ERISA plans
• Workers compensation coverage
• Government, school, and church health plans
• Out-of-state insureds
• Medicaid/Medicare
• State employee plans (except those involving HMO
  complaints)
• Federal employee plans
• Teacher Retirement System-Care
• University of Texas employees
• TRICARE Standard (CHAMPUS)
• Texas Association of School Boards coverage

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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

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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

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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

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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!

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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

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Proof of Claims Submission

• Return receipt
• Electronic confirmation
• Fax confirmation
• The 45-day time period to pay a claim begins on
  the date the claim is received by the carrier

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What are the Carriers 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

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• 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

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• Notice of deficient claims within 45 days
• Notice of changes in claims addresses,
  processors, etc.

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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

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• 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 enrollees
  appeal rights, if appealed within 30-day refund
  period
• Chargebacks are allowed with written notice and
  opportunity to arrange an alternative
  reimbursement method

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Penalties if Carriers Fail to Comply with the
Clean Claim Rules

• Full amount of billed charges up to UC charges,
  or
• Contracted penalty rate provided in the physician
  or providers contract
• Administrative penalties, up to 1,000/day per
  claim, may be assessed and collected by the State
  of Texas

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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

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Filing a Clean Claim

• File the claim within the contractual timeframes
• Send claims to the correct billing address
• Include all required data elements and
  attachments
• Maintain proof of timely filing

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(No Transcript)
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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

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All HMO Complaints ClosedFiscal Year 2000
lt
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PPO Claims Complaints ClosedFiscal Year 2000
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TDIs Authority

• Some issues fall under other agencies
  jurisdiction
• Self-funded ERISA plans
• Workers compensation coverage
• Government, school, and church health plans
• Out-of-state insureds
• Medicaid/Medicare
• State employee plans (except those involving HMO
  complaints)
• Federal employee plans
• Teacher Retirement System-Care
• University of Texas employees
• TRICARE Standard (CHAMPUS)
• Texas Association of School Boards coverage

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Physician and Provider Responsibilities

• Read and understand your contract
• Know contractual provisions for attachments
• Assure front office/billing service is aware of
  correct billing location for each carrier
• Submit clean claims
• Refund audit payments if claim is denied after
  audit
• Update accounts receivable regularly
• Allow 45 days for processing and payment of claim
  before resubmitting

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What TDI Needs to Work a Claims Complaint

• Written complaint
• Copy of patients health insurance ID card
• HCFA 1500 or UB-92 claim form submitted to the
  company for each patient and date of service
• Claims separated by the HMO or insurance carrier
  name

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• Valid evidence of claim submission for each claim
• Electronic transmission confirmation
• Certified mail return receipt
• Fax confirmation
• Courier delivery confirmation, or
• Claims mail log evidenced by faxed confirmation
  of date submitted via US first-class mail
  (proposed)
• Claim is presumed received on the third day after
  the date the claim is submitted
• Evidence of the collection activities undertaken
  for each claim
• Documentation of phone conversations made to the
  health carrier and/or
• Copies of correspondence mailed to the health
  carrier
• The replies received from the health carrier

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Scenario 1

• DOS 5/29/01 with contracted provider
• Claim submitted to carrier via certified mail on
  6/20/01 with return receipt dated 6/26/01
• HCFA 1500 missing elements 14 15
• Provider filed complaint with Department on
  7/12/01
• Clean claim violation?

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Scenario 2

• DOS 11/21/00 with contracted provider
• Submitted HCFA 1500 within contractual timeframes
• Provider resubmitted HCFA 1500 every 15 days
  after original submission until paid
• Claim paid at contracted rate 45 days after
  original submission receipt
• Clean claim violation?

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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
• All required elements on HCFA 1500 and all
  attachments provided
• ER followed up on unpaid claim on 2/1/01
• Clean claim violation?

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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?

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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?

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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?

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Scenario 7

• Provider filed complaint with TDI requesting
  assistance in collecting full-billed charges
• Information provided included
• Contracted provider submitted claim to carrier
  via electronic submission for DOS 8/30/00
• Carrier states they did not receive claim
• Claim resubmitted on paper, then denied for
  timely filing
• Proof of the electronic filing was submitted to
  carrier and claim paid at contracted rate
• Clean claim violation?

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Resources

• Website
• www.tdi.state.tx.us
• Provider Ombudsman
• Audrey Selden, Senior Associate Commissioner
• [phone]
• Toll Free Information
• 1-800-252-3439