Other articles in Fall 2012
A Survey of State Prompt Pay Laws, Part I
Neda Mirafzali, Esq.
Clark Hill, PLC, Birmingham, MI
Many states have laws or regulations in place that require health insurers in the state to reimburse claims within a certain timeframe or face penalties, oftentimes in the form of interest applied to the amount of the claim. Such laws or regulations are typically called “Prompt Pay” laws or “Clean Claim.” While each state or, sometimes, insurer, defines the requirements for a claim to be a “clean claim,” generally, a “clean claim” is a claim that has all of the information an insurer needs to either pay or deny the claim. A “non-clean claim” is a claim that requires additional information or documentation to make it clean. Each state sets forth the timeframes in which insurers have to reimburse a clean claim. Absent certain exceptions (e.g., instances of suspected fraudulent activity, contractual provisions setting forth alternative timeframes, etc.), failure to adhere to the timeframes results in penalties oftentimes in the form of interest applied to the amount of the claim and some states impose administrative penalties upon insurers that regularly fail to adjudicate claims in a timely fashion.
The purpose of this two-part survey is to outline and list the key elements of states’ prompt pay laws as they pertain to anesthesiologists, focusing on the relevant timeframes in place for insurance companies as well as the potential penalties for failure to comply. Of course, every instance of reimbursement is unique and should be addressed based on its distinct facts and circumstances.