1. Texas
Department of Insurance
Jose Montemayor, Commissioner

2. Prompt Payment to Providers 28 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. A physician or provider must refund the 85% audit payment:
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

20. All HMO Complaints Closed Fiscal Year 2000
< 4%

21. PPO Claims Complaints Closed Fiscal 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: Provider Ombudsman Toll Free Information
Provider Ombudsman
Audrey Selden, Senior Associate Commissioner
(512)
Toll Free Information