Legislature(2001 - 2002)
04/09/2001 01:39 PM House FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 113
An Act relating to health care insurance payments for
hospital or medical services; and providing for an
effective date.
REPRESENTATIVE JOE GREEN testified that HB 113 would build
upon a national trend to develop fair payment provisions
that would enable health insurance companies to make sound
business decisions while ensuring that patients receive
benefit payments in an appropriate time frame. The concept
of "prompt pay" legislation has been successfully adopted
and implemented by 39 states.
HB 113 requires health insurers to pay benefits within
thirty calendar days of receiving a "clean claim". If a
payment is not made on time, the insurer would be charged
interest on the outstanding claim. HB 113 would also
establish a definition for "clean claim" that recognizes an
insurance company's need to make payment decisions based
upon complete and accurate information.
Vice-Chair Bunde noted that since the legislation indicates
that interest would be paid for delayed payments, that
concept indicates that currently, the insurance companies
are making money on those payments delayed past thirty days.
He asked if it was known what that amount was nationally.
Representative Green explained that there is a presumption
by the insurance companies that if they delay payment, they
then have use of that money.
Representative Croft asked about the definition of clean
claim. He asked if it had been "tested" in other states.
KEVIN JARDELL, STAFF, REPRESENTATIVE JOE GREEN, responded
that the definition of "clean claim" has been addressed by
many states and is difficult to formulate. He noted that
the definition chosen, benefits insurance companies and is
broadly written. Physicians requested that "hard" date
lines be established. Clean claim terminology comes from
the Medicare definition.
Representative Croft asked an alternative definition. Mr.
Jardell replied that the American Medical Association (AMA)
is agreeable with the proposed definition. He stressed that
the intent was not to undermine the viability of insurance
companies in Alaska.
Representative Croft asked where the procedures would be
outlined regarding whether the insurance companies owe the
claim or not. Mr. Jardell replied that the claimant would
go through the Insurance Division by filing a complaint. It
is the intent that the legislation would make insurance
companies develop more efficient methods of paying claims.
Representative Davies referenced Page 4, and asked if the
qualifier that precludes timely payments on the claim, apply
into propriety as well as circumstances. Mr. Jardell
understood that it would not apply to language that resulted
from a technical or grammatical error. If the information
needed had been included on the claim, then that claim would
be a clean claim. Representative Green advised that most of
the larger insurance companies insure more than one state
and that this language was used by a significant number of
states. He stated that it was reasonable.
Representative Hudson asked if the "clean claim" would be
impacted by Medicare's delay response. Representative Green
replied that the legislation would apply between the insured
and the insurance company.
JAMES JORDAN, (TESTIFIED VIA TELECONFERENCE), EXECUTIVE
DIRECTOR, ALASKA STATE MEDICAL ASSOCIATION, ANCHORAGE,
testified that the Alaska State Medical Association does
support the proposed legislation. He stated that "clean
claim" definition included in the bill is based on
Medicare's definition. Currently, there are regulations
being adopted on the federal level, which deal with the
confidentiality of medical records and information for the
payment of health insurance claims. In enacting that bill,
Mr. Jordan stated that there would be an activation of
regulations. It is anticipated that the State Division of
Insurance will adopt regulations defining what a clean claim
is.
Representative Davies asked how to read Subsection K, Page
4, the qualifier of timely payments. He asked if that would
be in reference to all three clauses, the defect, the
impropriety and the circumstance. Mr. Jordan replied that
it would.
Representative Hudson MOVED to report CS HB 113 (HES) out of
Committee with individual recommendations and with the
accompanying fiscal note. Representative Harris OBJECTED in
order to ask about all the fiscal notes. Representative
Green stated that they were all zero. Representative Harris
WITHDREW his OBJECTION.
There being NO further OBJECTION, it was so ordered.
CS HB 113 (HES) was reported out of Committee with a "do
pass" recommendations and with zero fiscal notes by
Department of Administration and Department of Community &
Economic Development dated 3/07/01.
| Document Name | Date/Time | Subjects |
|---|