SS#2/SCS/HS/HCS/HBs 328 & 88 - This act makes several modifications to the managed care and insurance statutes.

FINANCIAL OVERSIGHT OF PROVIDERS - A health carrier will no longer have to monitor the financial capability of its providers. Providers will not be required to submit copies of their income tax returns to a health carrier. The health carrier may require a provider to obtain audited financial statements if the provider receives 10% or more of the total medical expenditures made by the health carrier. (Section 354.603).

HOSPITALISTS - No contract between a carrier and provider shall require the mandatory use of a hospitalist (Section 354.606). A "hospitalist" is defined as a physician who becomes the physician of record for a patient of a participating provider (such as a primary care provider). The hospitalist may return care to the participating provider when the patient is released from the hospital (SB 445).

This act requires the Division of Family Services to approve or deny a completed application for medical assistance within 30 days of its submission. The Division of Family Services shall remit to licensed nursing home operators the medicaid payment for a newly admitted resident in a long term care facility within 45 days of the resident's admission.

PROMPT PAY - Under this act, within 10 working days of receiving a claim for reimbursement by a provider, a carrier must either send acknowledgment of the date of receipt or send notice of the status of the claim which includes a request for additional information.

Within 15 days of receiving the additional information, the health carrier shall pay the claim or send notice that the claim is denied or make a final request for additional information. Within 15 days of receiving the additional information requested in the final request, the carrier shall either pay the claim, deny the claim or suspend the claim.

If the carrier does has not paid the claimant on or before the 45th day from the date of receipt, the carrier shall pay the claimant 1% per month.

If the carrier fails to pay, deny or suspend the claim within 40 processing days, and has received on or after the 40th day, notice from the provider that the claim has not been paid, denied or suspended, the carrier shall pay to the claimant per day, in addition to any interest due, an amount of 50% of the claim but not to exceed $20. This penalty shall not accrue for more than 30 days unless the claimant provides a second notice to the carrier that the claim remains unpaid. The penalties will cease to accrue once the health carrier pays, denies or suspends the claim. The penalties will also cease to accrue the day after a petition is filed in court to recover payment of the claim. The claimant may receive attorney fees in addition to the claim, interest or penalties fi a court finds that the health carrier failed to pay the claim without reasonable cause. If the provider files suit without reasonable grounds to recover the claim, the health carrier will be entitled to reasonable attorney fees for defending the lawsuit.

The Department of Insurance is required to monitor suspensions made by health carriers to determine their reasonableness. Health carriers shall report suspected fraudulent claims to the Department of Insurance.

Health carriers shall permit nonparticipating health care providers to file claims up to one year from the date of service and allow participating health care providers to file claims for 6 months from the date of service (unless the contract states differently). Health carriers shall not request a refund or offset against a claim more than 12 months after the carrier has paid the claim except in cases of fraud. Health carriers shall issue within one working day a confirmation of receipt of an electronically filed claim.

After January 1, 2003, all claims for reimbursement must be submitted in an electronic format consistent with federal rules and regulations. Claims filed after that date in a non- electronic format will not be subject to the prompt pay provisions of Section 376.383, RSMo.

After January 1, 2002, the Department of Insurance shall monitor health carrier compliance with the prompt pay provisions. Compliance with the prompt pay provisions is defined as properly processing and paying 95% of all claims received in a given calendar year. The Director may assess administrative penalties against a health carrier up to $25 per claim (not to exceed to aggregate amount of $250,000 a year) for failing to comply with the prompt pay provisions. The director may also assess penalties against health carriers who fail to make interest payments.

The Director of the Department of Insurance shall develop a system in which health care providers can file complaints regarding violations of the prompt pay provisions. The complaints must be considered when determining whether to examine a carrier's compliance with the prompt pay provisions.

On or after January 1, 2003, all claims submitted electronically shall be submitted in a uniform format utilizing standard medical code sets. The format will be established by the Department of Insurance through rules. The format shall be consistent with standards adopted pursuant to the Health Insurance Portability and Accountability Act.

The prompt pay provisions (Sections 376.383 and 376.384) become effective January 1, 2002.

NEWBORN COVERAGE - Upon notification, health carriers must provide an enrollee with the forms and instructions necessary to enroll a newly born child if an application is required in order to continue coverage beyond the 31-day period after the child's birth (Section 376.406).

Portions of this act are similar to SB 289, SBs 391 & 395, SB 445, and HB 949 (2001).
STEPHEN WITTE