Texas

1. Texas Department of Insurance Jose Montemayor, Commissioner

2. 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

3. 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

4. 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

5. 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

6. 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

7. 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!

8. 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

9. 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

10. 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

11. 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

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

13. 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

14. 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

15. 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 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

16. 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

17. 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

19. 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

20. All HMO Complaints ClosedFiscal Year 2000 < 4%

21. PPO Claims Complaints ClosedFiscal Year 2000

22. TDI’s 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

23. 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

24. What TDI Needs to “Work” a Claims Complaint • Written complaint • Copy of patient’s 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

25. 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

26. 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?

27. 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?

28. 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?

29. 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?

30. 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?

31. 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?

32. 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?

33. Resources • Website: • www.tdi.state.tx.us • Provider Ombudsman • Audrey Selden, Senior Associate Commissioner • (512) 475-1760 • Toll Free Information • 1-800-252-3439