South Carolina General Assembly
117th Session, 2007-2008
Sponsors: Senator Rankin
Document Path: l:\s-res\lar\ 008prom.dag.doc
Introduced in the Senate on January 10, 2008
Currently residing in the Senate Committee on Banking and Insurance
Summary: Health care
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number
1/10/2008 Senate Introduced and read first time SJ-2
1/10/2008 Senate Referred to Committee on Banking and Insurance SJ-2
VERSIONS OF THIS BILL
9 A BILL
11 TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA,
12 1976, BY ADDING CHAPTER 94 TO TITLE 38, SO AS TO
13 PROVIDE FOR THE PROMPT PAYMENT OF HEALTH CARE
14 PROVIDERS BY AN INSURER, AND TO PROVIDE CIVIL
15 PENALTIES, AND BY ADDING SECTION 38-71-225 SO AS
16 TO PROVIDE THAT A HEALTH INSURER MAY NOT DENY
17 AN INSURANCE CLAIM FOR HEALTH CARE SERVICE TO
18 ANY PROVIDER OF HEALTH CARE SERVICES PROVIDED
19 ON THE SAME DAY UNDER CERTAIN CIRCUMSTANCES.
21 Be it enacted by the General Assembly of the State of South
24 SECTION 1. Title 38 of the 1976 Code is amended by adding:
26 “CHAPTER 94
28 Prompt Payment of
29 Health Care Providers by an Insurer
31 Section 38-94-10. The provisions of this chapter apply to all
32 insurers, insurance companies, provider networks, provider
33 organizations, managed care organizations, managed care plans,
34 health maintenance organizations, third party payors, payment
35 administrators, and other agents, contractors and subcontractors in
36 the administration of programs of health, hospital, dental, and
37 medical insurance. The provisions of this chapter are remedial and
38 must be liberally construed to effectuate their purpose and apply in
39 addition to other remedies available at law or equity.
41 Section 38-94-20. As used in this chapter:
42 (1)(a) A ‘clean claim’ means:
1 (i) a nonelectronic claim by a provider, other than an
2 institutional provider, if the claim is submitted using the Centers
3 for Medicare and Medicaid Services Form 1500 or, if promulgated
4 by the director by regulation, a successor to that form developed
5 by the National Uniform Claim Committee or its successor. An
6 electronic claim by a provider, other than an institutional provider,
7 is a ‘clean claim’ if the claim is submitted using the Professional
8 837 (ASC X12N 837) format or, if promulgated by the director by
9 regulation, a successor to that format adopted by the Centers for
10 Medicare and Medicaid Services or its successor;
11 (ii) a nonelectronic claim by an institutional provider if the
12 claim is submitted using the Centers for Medicare and Medicaid
13 Services Form UB-92 or, if promulgated by the director by
14 regulation, a successor to that form developed by the National
15 Uniform Billing Committee or its successor. An electronic claim
16 by an institutional provider is a ‘clean claim’ if the claim is
17 submitted using the Institutional 837 (ASC X12N 837) format or,
18 if promulgated by the director by regulation, a successor to that
19 format adopted by the Centers for Medicare and Medicaid Services
20 or its successor.
21 (b) The director may promulgate regulations that specify the
22 information that must be entered into the appropriate fields on the
23 applicable claim form for a claim to be a clean claim.
24 (c) The director may not require any data element for an
25 electronic claim that is not required in an electronic transaction set
26 needed to comply with federal law.
27 (d) An insurer and a provider may agree by contract to use
28 fewer data elements than are required in an electronic transaction
29 set needed to comply with federal law.
30 (e) An otherwise clean claim submitted by a provider that
31 includes additional fields, data elements, attachments, or other
32 information not required by this section is considered to be a clean
33 claim for the purposes of this chapter.
34 (f) Except as provided by subitem (d) of this item, the
35 provisions of this section may not be waived, voided, or nullified
36 by contract.
37 (2) ‘Health care services’ means services included in
38 furnishing an individual medical or dental care or hospitalization,
39 or services incident to the furnishing of medical or dental care or
40 hospitalization, and other services to prevent, alleviate, cure, or
41 heal human illness, injury, or physical disability.
1 (3) ‘Health maintenance organization’ means an entity, group,
2 or person who undertakes to provide or arrange for basic health
3 care services to enrollees in exchange for a fixed prepaid premium.
4 (4) ‘Insured’ means an individual resident of this State who is
5 eligible to receive benefits from an insurer.
6 (5) ‘Insurer’ includes an entity, corporation, fraternal
7 organization, burial association, health maintenance organization,
8 managed care organization, managed care plan, other association,
9 partnership, society, order, individual, or aggregation of
10 individuals engaging or proposing or attempting to engage as
11 principals in any kind of insurance or surety business, including
12 the exchanging of reciprocal or interinsurance contracts between
13 individuals, partnerships, and corporations. For purposes of this
14 chapter, an insurer is an entity, person, or group providing health
15 insurance or reimbursement for health care services whether for
16 profit or otherwise, which is licensed to engage in the business of
17 insurance in this State and which is subject to state insurance
18 regulation, including multiple employer self-insured health plans
19 licensed pursuant to Chapter 41, Title 38.
20 (6) ‘Managed care organization’ means a licensed insurance
21 company, a hospital or medical services plan contract, a health
22 maintenance organization, or any other entity which is subject to
23 state insurance regulation and which operates a managed care plan.
24 (7) ‘Managed care plan’ means a plan operated by a managed
25 care organization which provides for the financing and delivery of
26 health care and treatment services to individuals enrolled in the
27 plan through its own employed health care providers or contracting
28 with selected specific providers that conform to explicit selection
29 standards, or both. A managed care plan also customarily has a
30 formal organizational structure for continual quality assurance, a
31 certified utilization review program, dispute resolution, and
32 financial incentives for individual enrollees to use the plan’s
33 participating providers and procedures.
34 (8) ‘Preauthorization’ means a determination by an insurer that
35 medical care or health care services proposed to be provided to a
36 patient are medically necessary and appropriate.
37 (9) ‘Provider’ means a physician, dentist, hospital, or other
38 person properly licensed, certified, or permitted, where required, to
39 furnish health care services.
40 (10) ‘Verification’ means a reliable representation by an insurer
41 to a health care provider that the insurer will pay the provider for
42 proposed medical care or health care services if the provider
43 renders those services to the patient for whom the services are
1 proposed. The term includes precertification, certification,
2 recertification, and any other term that would be a reliable
3 representation by an insurer to a provider.
5 Section 38-94-30. (A) A provider must submit a claim to an
6 insurer not later than the ninety-fifth day after the date the provider
7 provides the medical care or health care services for which the
8 claim is made. An insurer shall accept as proof of timely filing a
9 claim filed in compliance with subsection (B) or information from
10 another insurer or health maintenance organization showing that
11 the provider submitted the claim to the insurer or health
12 maintenance organization in compliance with subsection (B). If a
13 provider fails to submit a claim in compliance with this subsection,
14 the provider forfeits the right to payment unless the failure to
15 submit the claim in compliance with this subsection is a result of a
16 catastrophic event that substantially interferes with the normal
17 business operations of the provider. The period for submitting a
18 claim under this subsection may be extended by contract. A
19 provider may not submit a duplicate claim for payment before the
20 forty-sixth day after the date the original claim was submitted.
21 The director shall promulgate regulations under which an insurer
22 may determine whether a claim is a duplicate claim.
23 (B) A provider, as appropriate, may:
24 (1) mail a claim by United States mail, first class, or by
25 overnight delivery service;
26 (2) submit the claim electronically;
27 (3) fax the claim; or
28 (4) hand deliver the claim.
29 (C) If a claim for medical care or health care services provided
30 to a patient is mailed, the claim is presumed to have been received
31 by the insurer on the fifth day after the date the claim is mailed or,
32 if the claim is mailed using overnight service or return receipt
33 requested, on the date the delivery receipt is signed. If the claim is
34 submitted electronically, the claim is presumed to have been
35 received on the date of the electronic verification of receipt by the
36 insurer or the insurer’s clearinghouse. If the insurer or the
37 insurer’s clearinghouse does not provide a confirmation within
38 twenty-four hours of submission by the provider, the provider’s
39 clearinghouse shall provide the confirmation. The provider’s
40 clearinghouse must be able to verify that the filing contained the
41 correct payor identification of the entity to receive the filing. If the
42 claim is faxed, the claim is presumed to have been received on the
43 date of the transmission acknowledgment. If the claim is hand
1 delivered, the claim is presumed to have been received on the date
2 the delivery receipt is signed.
3 (D) Except as provided by subsection (H), not later than the
4 forty-fifth day after the date the insurer receives a clean claim from
5 a provider in a nonelectronic format or the thirtieth day after the
6 date the insurer receives a clean claim from a provider that is
7 electronically submitted, the insurer shall make a determination of
8 whether the claim is payable and if the insurer determines:
9 (1) the entire claim is payable, pay the total amount of the
10 claim in accordance with the contract between the provider and the
12 (2) a portion of the claim is payable, pay the portion of the
13 claim that is not in dispute and notify the provider in writing why
14 the remaining portion of the claim will not be paid; or
15 (3) that the claim is not payable, notify the provider in
16 writing why the claim will not be paid.
17 (E) Not later than the twenty-first day after the date an insurer
18 affirmatively adjudicates a pharmacy claim that is electronically
19 submitted, the insurer shall pay the total amount of the claim.
20 (F) Except as provided by subsection (H), if the insurer intends
21 to audit the provider claim, the insurer shall pay the charges
22 submitted at one hundred percent of the contracted rate on the
23 claim not later than the thirtieth day after the date the insurer
24 receives the clean claim from the provider if submitted
25 electronically or if submitted nonelectronically not later than the
26 forty-fifth day after the date the insurer receives the clean claim
27 from the provider. The insurer clearly shall indicate on the
28 explanation of payment statement in the manner prescribed by the
29 director by regulation that the clean claim is being paid at one
30 hundred percent of the contracted rate, subject to completion of the
31 audit. If the insurer requests additional information to complete
32 the audit, the request must describe with specificity the clinical
33 information requested and relate only to information the insurer in
34 good faith can demonstrate is specific to the claim or episode of
35 care. The insurer may not request as a part of the audit
36 information that is not contained in, or is not in the process of
37 being incorporated into, the patient’s medical or billing record
38 maintained by a provider. If the provider does not supply
39 information reasonably requested by the insurer in connection with
40 the audit, the insurer may:
41 (1) notify the provider in writing that the provider shall
42 provide the information not later than the forty-fifth day after the
43 date of the notice or forfeit the amount of the claim; and
1 (2) if the provider does not provide the information required
2 by this subsection, recover the amount of the claim.
3 (G) The insurer shall complete the audit on or before the one
4 hundredth eightieth day after the date the clean claim is received
5 by the insurer, and any additional payment due a provider or any
6 refund due the insurer must be made not later than the thirtieth day
7 after the completion of the audit. If a provider disagrees with a
8 refund request made by an insurer based on the audit, the insurer
9 shall provide the provider with an opportunity to appeal, and the
10 insurer may not attempt to recover the payment until all appeal
11 rights are exhausted.
12 (H) The investigation and determination of payment, including
13 any coordination of other payments, does not extend the period for
14 determining whether a claim is payable under subsection (D) or
15 (E) or for auditing a claim under subsection (F).
16 (I) If an insurer needs additional information from a treating
17 provider to determine payment, the insurer, not later than the
18 thirtieth calendar day after the date the insurer receives a clean
19 claim, shall request in writing that the provider provide an
20 attachment to the claim that is relevant and necessary for
21 clarification of the claim. The request must describe with
22 specificity the clinical information requested and relate only to
23 information the insurer can demonstrate is specific to the claim or
24 the claim’s related episode of care. The provider is not required to
25 provide an attachment that is not contained in, or is not in the
26 process of being incorporated into, the patient’s medical or billing
27 record maintained by a provider. An insurer that requests an
28 attachment under this subsection shall determine whether the claim
29 is payable on or before the later of the fifteenth day after the date
30 the insurer receives the requested attachment or the latest date for
31 determining whether the claim is payable under subsection (D) or
32 (E). An insurer may not make more than one request under this
33 subsection in connection with a claim. Subsections (B) and (C)
34 apply to a request for and submission of an attachment under this
36 (J) If an insurer requests an attachment or other information
37 from a person other than the provider who submitted the claim, the
38 insurer shall provide notice containing the name of the provider
39 from whom the insurer is requesting information to the provider
40 who submitted the claim. The insurer may not withhold payment
41 pending receipt of an attachment or information requested under
42 this subsection. If on receiving an attachment or information
43 requested under this subsection the insurer determines that there
1 was an error in payment of the claim, the insurer may recover any
2 overpayment pursuant to the provisions of Section 38-94-40.
3 (K) The director shall promulgate regulations under which an
4 insurer can easily identify attachments or other information
5 submitted by a provider pursuant to the provisions of subsection (I)
6 or (J).
7 (L) The insurer’s claims payment processes must:
8 (1) use nationally recognized, generally accepted Current
9 Procedural Terminology codes, notes, and guidelines, including all
10 relevant modifiers; and
11 (2) be consistent with nationally recognized, generally
12 accepted bundling edits and logic.
13 (M) A provider may recover reasonable attorney’s fees and
14 court costs in an action to recover payment pursuant to the
15 provisions this section.
16 (N) The director of insurance may promulgate regulations as
17 necessary to implement this chapter.
18 (O) Except as provided by subsection (A), the provisions of this
19 section may not be waived, voided, or nullified by contract.
21 Section 38-94-40. (A) An insurer may recover an overpayment
22 to a provider if:
23 (1) not later than the one hundred eightieth day after the date
24 the provider receives the payment, the insurer provides written
25 notice of the overpayment to the provider that includes the basis
26 and specific reasons for the request for recovery of funds; and
27 (2) the provider does not make arrangements for repayment
28 of the requested funds on or before the forty-fifth day after the date
29 the provider receives the notice.
30 (B) If a provider disagrees with a request for recovery of an
31 overpayment, the insurer shall provide the provider with an
32 opportunity to appeal, and the insurer may not attempt to recover
33 the overpayment until all appeal rights are exhausted.
35 Section 38-94-50. (A) In this section, ‘verification’ includes
36 preauthorization only when preauthorization is a condition for the
38 (B) On the request of a provider for verification of a particular
39 medical care or health care service the provider proposes to
40 provide to a particular patient, the insurer shall inform the provider
41 without delay whether the service, if provided to that patient, will
42 be paid by the insurer and shall specify any deductibles,
43 copayments, or coinsurance for which the insured is responsible.
1 (C) An insurer shall have appropriate personnel reasonably
2 available at a toll-free telephone number to provide a verification
3 under this section between six a.m. and six p.m. Eastern Time
4 Monday through Friday on each day that is not a legal holiday and
5 between nine a.m. and noon Eastern Time on Saturday, Sunday,
6 and legal holidays. An insurer shall have a telephone system
7 capable of accepting or recording incoming phone calls for
8 verifications after six p.m. Eastern Time Monday through Friday
9 and after noon Eastern Time on Saturday, Sunday, and legal
10 holidays and responding to each of those calls on or before the
11 second calendar day after the date the call is received.
12 (D) An insurer may decline to determine eligibility for payment
13 if the insurer notifies the provider who requested the verification of
14 the specific reason the determination was not made.
15 (E) An insurer may establish a specific period during which the
16 verification is valid of not less than thirty days.
17 (F) An insurer that declines to provide a verification shall
18 notify the provider who requested the verification of the specific
19 reason the verification was not provided.
20 (G) If an insurer has provided a verification for proposed
21 medical care or health care services, the insurer may not deny or
22 reduce payment to the provider for those medical care or health
23 care services if provided to the insured on or before the thirtieth
24 day after the date the verification was provided unless the provider
25 has materially misrepresented the proposed medical or health care
26 services or has substantially failed to perform the proposed
27 medical or health care services.
28 (H) The provisions of this section may not be waived, voided,
29 or nullified by contract.
31 Section 38-94-60. (A) An insurer may require a provider to
32 retain in the provider’s records updated information concerning
33 other health benefit plan coverage and to provide the information
34 to the insurer on the applicable form described in Section
36 Except as provided by this subsection, an insurer may not
37 require a provider to investigate coordination of other health
38 benefit plan coverage.
39 (B) Coordination of payment under this section does not extend
40 the period for determining whether a service is eligible for
42 (C) A provider who submits a claim for particular medical care
43 or health care services to more than one health maintenance
1 organization or insurer shall provide written notice on the claim
2 submitted to each health maintenance organization or insurer of the
3 identity of each other health maintenance organization or insurer
4 with which the same claim is being filed.
5 (D) On receipt of notice under subsection (C), an insurer shall
6 coordinate and determine the appropriate payment for each health
7 maintenance organization or insurer to make to the provider.
8 (E) Except as provided by subsection (F), if an insurer is a
9 secondary payor and pays a portion of a claim that should have
10 been paid by the insurer or health maintenance organization that is
11 the primary payor, the overpayment may only be recovered from
12 the health maintenance organization or insurer that is primarily
13 responsible for that amount.
14 (F) If the portion of the claim overpaid by the secondary
15 insurer was also paid by the primary health maintenance
16 organization or insurer, the secondary insurer may recover the
17 amount of overpayment under Section 38-94-40 from the provider
18 who received the payment. An insurer processing an electronic
19 claim as a secondary payor shall rely on the primary payor
20 information submitted on the claim by the provider. Primary
21 payor information may be submitted electronically by the primary
22 payor to the secondary payor.
23 (G) An insurer may share information with a health
24 maintenance organization or another insurer to the extent
25 necessary to coordinate appropriate payment obligations on a
26 specific claim.
27 (H) The provisions of this section may not be waived, voided,
28 or nullified by contract.
30 Section 38-94-70. (A) An insurer that uses a preauthorization
31 process for medical care and health care services shall provide to
32 each provider, not later than the tenth business day after the date a
33 request is made, a list of medical care and health care services that
34 require preauthorization and information concerning the
35 preauthorization process.
36 (B) If proposed medical care or health care services require
37 preauthorization as a condition of the insurer’s payment to a
38 provider under a health insurance policy, the insurer shall
39 determine whether the medical care or health care services
40 proposed to be provided to the insured are medically necessary and
42 (C) On receipt of a request from a provider for
43 preauthorization, the insurer shall review and issue a determination
1 indicating whether the proposed medical or health care services are
2 preauthorized. The determination must be issued and transmitted
3 not later than the third calendar day after the date the request is
4 received by the insurer.
5 (D) If the proposed medical care or health care services involve
6 inpatient care and the insurer requires preauthorization as a
7 condition of payment, the insurer shall review the request and issue
8 a length of stay for the admission into a health care facility based
9 on the recommendation of the patient’s provider and the insurer’s
10 written medically accepted screening criteria and review
11 procedures. If the proposed medical or health care services are to
12 be provided to a patient who is an inpatient in a health care facility
13 at the time the services are proposed, the insurer shall review the
14 request and issue a determination indicating whether proposed
15 services are preauthorized within twenty-four hours of the request
16 by the provider.
17 (E) An insurer shall have appropriate personnel reasonably
18 available at a toll-free telephone number to respond to requests for
19 a preauthorization between six a.m. and six p.m. Eastern Time
20 Monday through Friday on each day that is not a legal holiday and
21 between nine a.m. and noon Eastern Time on Saturday, Sunday,
22 and legal holidays. An insurer shall have a telephone system
23 capable of accepting or recording incoming phone calls for
24 preauthorizations after six p.m. Eastern Time Monday through
25 Friday and after noon Eastern Time on Saturday, Sunday, and legal
26 holidays and responding to each of those calls not later than
27 twenty-four hours after the call is received.
28 (F) If an insurer has preauthorized medical care or health care
29 services, the insurer may not deny or reduce payment to the
30 provider for those services based on medical necessity or
31 appropriateness of care unless the provider has materially
32 misrepresented the proposed medical or health care services or has
33 substantially failed to perform the proposed medical or health care
35 (G) This section applies to an agent or other person with whom
36 an insurer contracts to perform, or to whom the insurer delegates
37 the performance of, preauthorization of proposed medical or health
38 care services.
39 (H) The provisions of this section may not be waived, voided,
40 or nullified by contract.
42 Section 38-94-80. (A) A contract between an insurer and a
43 provider must provide that the:
1 (1) provider may request a description and copy of the
2 coding guidelines, including any underlying bundling, recoding, or
3 other payment process and fee schedules applicable to specific
4 procedures that the provider will receive under the contract;
5 (2) insurer or the insurer’s agent will provide the coding
6 guidelines and fee schedules not later than the thirtieth day after
7 the date the insurer receives the request;
8 (3) insurer or the insurer’s agent will provide notice of
9 changes to the coding guidelines and fee schedules that will result
10 in a change of payment to the provider not later than the ninetieth
11 day before the date the changes take effect and will not make
12 retroactive revisions to the coding guidelines and fee schedules;
14 (4) contract may be terminated by the provider on or before
15 the thirtieth day after the date the provider receives information
16 requested under this subsection without penalty or discrimination
17 in participation in other health care products or plans.
18 (B) A provider who receives information under subsection (A)
19 may only:
20 (1) use or disclose the information for the purpose of
21 practice management, billing activities, and other business
22 operations; and
23 (2) disclose the information to a governmental agency
24 involved in the regulation of health care or insurance.
25 (C) The insurer, on request of the provider, shall provide the
26 name, edition, and model version of the software that the insurer
27 uses to determine bundling and unbundling of claims.
28 (D) The provisions of this section may not be waived, voided,
29 or nullified by contract.
31 Section 38-94-90. (A) Except as provided by this section, if a
32 clean claim submitted to an insurer is payable and the insurer does
33 not determine under Section 38-94-30 that the claim is payable and
34 pay the claim on or before the date the insurer is required to make
35 a determination or adjudication of the claim, the insurer shall pay
36 the provider making the claim the contracted rate owed on the
37 claim plus a penalty in the amount of the lesser of:
38 (1) fifty percent of the difference between the billed charges,
39 as submitted on the claim, and the contracted rate; or
40 (2) one hundred thousand dollars.
41 (B) If the claim is paid on or after the forty-sixth day and
42 before the ninetieth-first day after the date the insurer is required to
1 make a determination or adjudication of the claim, the insurer shall
2 pay a penalty in the amount of the lesser of:
3 (1) one hundred percent of the difference between the billed
4 charges, as submitted on the claim, and the contracted rate; or
5 (2) two hundred thousand dollars.
6 (C) If the claim is paid on or after the ninetieth-first day after
7 the date the insurer is required to make a determination or
8 adjudication of the claim, the insurer shall pay a penalty computed
9 under subsection (B) plus eighteen percent annual interest on that
10 amount. Interest under this subsection accrues beginning on the
11 date the insurer was required to pay the claim and ending on the
12 date the claim and the penalty are paid in full.
13 (D) Except as provided by this section, an insurer that
14 determines under Section 38-94-30 that a claim is payable, pays
15 only a portion of the amount of the claim on or before the date the
16 insurer is required to make a determination or adjudication of the
17 claim, and pays the balance of the contracted rate owed for the
18 claim after that date shall pay to the provider, in addition to the
19 contracted amount owed, a penalty on the amount not timely paid
20 in the amount of the lesser of:
21 (1) fifty percent of the underpaid amount; or
22 (2) one hundred thousand dollars.
23 (E) If the balance of the claim is paid on or after the forty-sixth
24 day and before the ninetieth-first day after the date the insurer is
25 required to make a determination or adjudication of the claim, the
26 insurer shall pay a penalty on the balance of the claim in the
27 amount of the lesser of:
28 (1) one hundred percent of the underpaid amount; or
29 (2) two hundred thousand dollars.
30 (F) If the balance of the claim is paid on or after the
31 ninetieth-first day after the date the insurer is required to make a
32 determination or adjudication of the claim, the insurer shall pay a
33 penalty on the balance of the claim computed under subsection (E)
34 plus eighteen percent annual interest on that amount. Interest
35 under this subsection accrues beginning on the date the insurer was
36 required to pay the claim and ending on the date the claim and the
37 penalty are paid in full.
38 (G) For the purposes of subsections (D) and (E), the underpaid
39 amount is calculated on the ratio of the amount underpaid on the
40 contracted rate to the contracted rate as applied to the billed
41 charges as submitted on the claim.
42 (H) An insurer is not liable for a penalty under this section:
1 (1) if the failure to pay the claim in accordance with Section
2 38-94-30 is a result of a catastrophic event that substantially
3 interferes with the normal business operations of the insurer; or
4 (2) if the claim was paid in accordance with Section
5 38-94-30, but for less than the contracted rate, and the:
6 (a) provider notifies the insurer of the underpayment after
7 the one hundred eightieth day after the date the underpayment was
8 received; and
9 (b) insurer pays the balance of the claim on or before the
10 forty-fifth day after the date the insurer receives the notice.
11 (I) Subsection (H) does not relieve the insurer of the obligation
12 to pay the remaining unpaid contracted rate owed the provider.
13 (J) An insurer that pays a penalty under this section shall
14 clearly indicate on the explanation of payment statement in the
15 manner prescribed by the director by regulation the amount of the
16 contracted rate paid and the amount paid as a penalty.”
18 SECTION 2. Article 1, Chapter 71, Title 38 of the 1976 Code is
19 amended by adding:
21 “Section 38-71-225. A health insurer may not deny an
22 insurance claim to any health care provider when, in the judgment
23 of the primary health care provider, medically necessary services,
24 including care and treatment services, are provided to an insured
25 on the same date. The provisions of this section include diagnostic
28 SECTION 3. (A) With respect to a contract entered into between
29 an insurer or health maintenance organization and a physician or
30 health care provider, and payment for medical care or health care
31 services under the contract, the changes in law made by this act
32 apply only to a contract entered into or renewed on or after the
33 sixtieth day after the effective date of this act and payment for
34 services under the contract. Such a contract entered into before the
35 sixtieth day after the effective date of this act and not renewed or
36 that was last renewed before the sixtieth day after the effective date
37 of this act, and payment for medical care or health care services
38 under the contract, are governed by the law in effect immediately
39 before the effective date of this act, and that law is continued in
40 effect for that purpose.
41 (B) With respect to the payment for medical care or health care
42 services provided, but not provided under a contract to which
43 subsection (A) applies, the changes in law made by this act apply
1 only to the payment for those services provided on or after the
2 sixtieth day after the effective date of this act. Payment for those
3 services provided before the sixtieth day after the effective date of
4 this act is governed by the law in effect immediately before the
5 effective date of this act, and that law is continued in effect for that
8 SECTION 4. If any section, subsection, paragraph, subparagraph,
9 sentence, clause, phrase, or word of this act is for any reason held
10 to be unconstitutional or invalid, such holding shall not affect the
11 constitutionality or validity of the remaining portions of this act,
12 the General Assembly hereby declaring that it would have passed
13 this act, and each and every section, subsection, paragraph,
14 subparagraph, sentence, clause, phrase, and word thereof,
15 irrespective of the fact that any one or more other sections,
16 subsections, paragraphs, subparagraphs, sentences, clauses,
17 phrases, or words hereof may be declared to be unconstitutional,
18 invalid, or otherwise ineffective.
20 SECTION 5. This act takes effect July 1, 2008.