SB 636 Modifies various provisions of the prompt pay statutes as they relate to the calculation of interest and penalties, the payment of attorney fees, and other ancillary matters
Sponsor: Lembke
LR Number: 3355S.03P Fiscal Note: 3355-03P.ORG
Committee: Judiciary and Civil and Criminal Jurisprudence
Last Action: 4/14/2010 - Referred to Rules Committee pursuant to Rule 25(32)(f) Journal Page: H967
Title: SCS SB 636 Calendar Position:
Effective Date: January 1, 2011
House Handler: Jones

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Current Bill Summary


SCS/SB 636 - This act modifies Missouri's prompt pay law. The act provides a definition for the term "clean claim." The term clean claim is defined as a claim that has no defect, impropriety, lack of any required substantiating documentation, or particular circumstance requiring special treatment that prevents timely payment.

Under the proposed act, the definition of health carrier is modified to include self-insured health plans, to the extent allowed by federal law. Under the act, third-party contractors are also considered health carriers. The act also amends the definition of "request for additional information" to mean a health carrier's electronic or facsimile request for additional information from a claimant which specifies what information is needed in order to process the claim for payment. The act deletes the definition of the term "suspends the claim" and the use of such term in the prompt pay provision.

Under the terms of the act, a health carrier must send an electronic acknowledgment of the date of receipt of an electronically filed claim by a health carrier or a third-party contractor within 48 hours. Within 30 processing days (current law allows 10 working days) after receipt of a filed claim by a health carrier, the carrier must send an electronic or facsimile notice of the status of the claim. The notice shall notify the claimant if the claim is a clean claim or whether the claim requires additional information from the claimant. If the claim is a clean claim, then the health carrier shall pay or deny the claim.

If the health carrier requests additional information, then the health carrier, within 10 processing days (current law is 15 days) must pay the claim, deny the claim, or make a final request for additional information. Within 5 processing days (current law is 15 days) after the day on which the health carrier receives the additional requested information in response to a final request for information, the health carrier shall pay the claim or deny the claim.

The act modifies the interest and penalty provision for failing to promptly pay a claim. Under the proposed act, if the health carrier has not paid the claimant on or before the 45th processing day from the date of the receipt of the claim, the carrier must pay the claimant 1% interest per month (current law) and a penalty in an amount equal to one percent of the claim per day. A health carrier may combine interest payments and make payment once the aggregate amount reaches $100 (current law is $5).

The interest and penalties cease to accrue on the day a petition is filed in court to recover payment on a claim. If a court determines that a health carrier has failed to pay a claim, interest, or penalty without good cause, the court shall enter judgment for attorney fees. If the court determines that a health care provider has filed suit without reasonable grounds to recover a claim, the court shall award the health carrier reasonable attorney fees related to the defense.

Under the terms of the act, any claim for which the health carrier has not communicated a specific reason for the denial shall not be considered denied under the prompt pay statutes. The act also provides that any request by a carrier for additional information shall be reasonable in scope and pertain solely to the carrier's liability.

The act has an effective date of January 1, 2011. This act is similar to SB 236 (2009).

STEPHEN WITTE