Chapter 747 Oregon Laws 2001

AN ACT

SB 894

Relating to claims for payment of health care services; creating new provisions; amending ORS 743.801 and 750.055; and declaring an emergency.

Be It Enacted by the People of the State of Oregon:

SECTION 1. Sections 2 and 3 of this 2001 Act are added to and made a part of ORS chapter 743.

SECTION 2. (1) Except as provided in this subsection, when a claim under a health benefit plan is submitted to an insurer by a provider on behalf of an enrollee, the insurer shall pay a clean claim or deny the claim not later than 30 days after the date on which the insurer receives the claim. If an insurer requires additional information before payment of a claim, not later than 30 days after the date on which the insurer receives the claim, the insurer shall notify the enrollee and the provider in writing and give the enrollee and the provider an explanation of the additional information needed to process the claim. The insurer shall pay a clean claim or deny the claim not later than 30 days after the date on which the insurer receives the additional information.

(2) A contract between an insurer and a provider may not include a provision governing payment of claims that limits the rights and remedies available to a provider under this section and section 3 of this 2001 Act or has the effect of relieving either party of their obligations under this section and section 3 of this 2001 Act.

(3) An insurer shall establish a method of communicating to providers the procedures and information necessary to complete claim forms. The procedures and information must be reasonably accessible to providers.

(4) This section does not create an assignment of payment to a provider.

(5) Each insurer shall report to the Director of the Department of Consumer and Business Services annually on its compliance under this section according to requirements established by the director.

(6) The director shall adopt by rule a definition of “clean claim” and shall consider the definition of “clean claim” used by the federal Department of Health and Human Services for the payment of Medicare claims.

SECTION 3. (1) An insurer that fails to pay a claim to a provider within the timelines established in section 2 of this 2001 Act shall pay simple interest of 12 percent per annum on the unpaid amount of the claim that is due and owing, accruing from the date after the payment was due until the claim is paid. Interest on any overdue payment for a claim begins to accrue on the 31st day after:

(a) The date on which the insurer received the claim; or

(b) The date the insurer receives the requested additional information.

(2) The interest is payable with the payment of the claim. An insurer is not required to pay interest that is in the amount of $2 or less on any claim.

(3) The availability of interest under subsection (1) of this section is in addition to and not in lieu of administrative actions and penalties that may be imposed by the Director of the Department of Consumer and Business Services under the Insurance Code.

SECTION 4. The Director of the Department of Consumer and Business Services shall report to the Seventy-third Legislative Assembly on the implementation of and compliance with sections 2 and 3 of this 2001 Act.

SECTION 5. ORS 743.801 is amended to read:

743.801. As used in ORS 743.699, 743.801, 743.803, 743.804, 743.806, 743.807, 743.808, 743.809, 743.811, 743.814, 743.817, 743.819, 743.821, 743.823, 743.827, 743.829, 743.831, 743.834, 743.837 and 743.839 and sections 2 and 3 of this 2001 Act:

(1) “Emergency medical condition” means a medical condition that manifests itself by symptoms of sufficient severity that a prudent layperson possessing an average knowledge of health and medicine would reasonably expect that failure to receive immediate medical attention would place the health of a person, or a fetus in the case of a pregnant woman, in serious jeopardy.

(2) “Emergency medical screening exam” means the medical history, examination, ancillary tests and medical determinations required to ascertain the nature and extent of an emergency medical condition.

(3) “Emergency services” means those health care items and services furnished in an emergency department and all ancillary services routinely available to an emergency department to the extent they are required for the stabilization of a patient.

(4) “Enrollee” has the meaning given that term in ORS 743.730.

[(4)] (5) “Grievance” means a written complaint submitted by or on behalf of an enrollee regarding the:

(a) Availability, delivery or quality of health care services, including a complaint regarding an adverse determination made pursuant to utilization review;

(b) Claims payment, handling or reimbursement for health care services; or

[(5)] (6) “Health benefit plan” has the meaning provided for that term in ORS 743.730.

[(6)] (7) “Independent practice association” means a corporation wholly owned by providers, or whose membership consists entirely of providers, formed for the sole purpose of contracting with insurers for the provision of health care services to enrollees, or with employers for the provision of health care services to employees, or with a group, as described in ORS 743.522, to provide health care services to group members.

[(7)] (8) “Insurer” has the meaning provided for that term in ORS 731.106. For purposes of ORS 743.699, 743.801, 743.803, 743.804, 743.806, 743.807, 743.808, 743.809, 743.811, 743.814, 743.817, 743.819, 743.821, 743.823, 743.827, 743.829, 743.831, 743.834, 743.837, 743.839, 750.055 and 750.333 and sections 2 and 3 of this 2001 Act, “insurer” also includes a health care service contractor as defined in ORS 750.005.

[(8)] (9) “Managed health insurance” means any health benefit plan that:

(a) Requires an enrollee to use, or creates incentives for an enrollee to use, providers managed, owned, under contract with or employed by the insurer; and

(b) Reimburses any of the providers described in paragraph (a) of this subsection on a basis other than fee-for-service billing or discounts from fee-for-service billing.

[(9)] (10) “Medical services contract” means a contract between an insurer and an independent practice association, between an insurer and a provider, between an independent practice association and a provider or organization of providers, between medical or mental health clinics, and between a medical or mental health clinic and a provider to provide medical or mental health services. “Medical services contract” does not include a contract of employment or a contract creating legal entities and ownership thereof that are authorized under ORS chapter 58, 60 or 70, or other similar professional organizations permitted by statute.

[(10)] (11) “Prior authorization” means a determination by an insurer prior to provision of services that the insurer will provide reimbursement for the services. “Prior authorization” does not include referral approval for evaluation and management services between providers.

[(11)] (12) “Provider” means a person licensed, certified or otherwise authorized or permitted by laws of this state to administer medical or mental health services in the ordinary course of business or practice of a profession.

[(12)] (13) “Stabilization” means that, within reasonable medical probability, no material deterioration of an emergency medical condition is likely to occur.

[(13)] (14) “Utilization review” means a set of formal techniques used by an insurer or delegated by the insurer designed to monitor the use of or evaluate the medical necessity, appropriateness, efficacy or efficiency of health care services, procedures or settings.

SECTION 6. ORS 750.055 is amended to read:

750.055. (1) The following provisions of the Insurance Code shall apply to health care service contractors to the extent so applicable and not inconsistent with the express provisions of ORS 750.005 to 750.095:

(a) ORS 731.004 to 731.150, 731.162, 731.216 to 731.362, 731.382, 731.385, 731.386, 731.390, 731.398 to 731.430, 731.450, 731.454, 731.488, 731.504, 731.508, 731.509, 731.510, 731.511, 731.512, 731.574 to 731.620, 731.592, 731.594, 731.640 to 731.652, 731.730, 731.731, 731.735, 731.737, 731.740, 731.750, 731.804 and 731.844 to 731.992.

(b) ORS 732.215, 732.220, 732.230, 732.245, 732.250, 732.320, 732.325 and 732.517 to 732.592, not including ORS 732.549 and 732.574 to 732.592.

(c)(A) ORS 733.010 to 733.050, 733.080, 733.140 to 733.170, 733.210, 733.510 to 733.620, 733.635 to 733.680 and 733.695 to 733.780 apply to not-for-profit health care service contractors.

(B) ORS chapter 733, not including ORS 733.630, applies to for-profit health care service contractors.

(d) ORS chapter 734.

(e) ORS 742.001 to 742.009, 742.013, 742.061, 742.065, 742.150 to 742.162, 742.400, 742.520 to 742.540, 743.010, 743.013, 743.018 to 743.030, 743.050, 743.100 to 743.109, 743.402, 743.412, 743.472, 743.492, 743.495, 743.498, 743.522, 743.523, 743.524, 743.526, 743.527, 743.528, 743.529, 743.549 to 743.555, 743.556, 743.560, 743.600 to 743.610, 743.650 to 743.656, 743.693, 743.697, 743.699, 743.701, 743.704, 743.706 to 743.712, 743.721, 743.722, 743.726, 743.727, 743.728, 743.729, 743.804, 743.807, 743.808, 743.809, 743.814 to 743.839, 743.842, 743.845 and 743.847 and sections 2 and 3 of this 2001 Act.

(f) The provisions of ORS chapter 744 relating to the regulation of agents.

(g) ORS 746.005 to 746.140, 746.160, 746.180, 746.220 to 746.370 and 746.600 to 746.690.

(h) ORS 743.714, except in the case of group practice health maintenance organizations that are federally qualified pursuant to Title XIII of the Public Health Service Act unless the patient is referred by a physician associated with a group practice health maintenance organization.

(i) ORS 735.600 to 735.650.

(j) ORS 743.680 to 743.689.

(k) ORS 744.700 to 744.740.

(L) ORS 743.730 to 743.773.

(m) ORS 731.485, except in the case of a group practice health maintenance organization that is federally qualified pursuant to Title XIII of the Public Health Service Act and that wholly owns and operates an in-house drug outlet.

(2) For the purposes of this section only, health care service contractors shall be deemed insurers.

(3) Any for-profit health care service contractor organized under the laws of any other state which is not governed by the insurance laws of such state, will be subject to all requirements of ORS chapter 732.

(4) The Director of the Department of Consumer and Business Services may, after notice and hearing, adopt reasonable rules not inconsistent with this section and ORS 750.003, 750.005, 750.025 and 750.045 that are deemed necessary for the proper administration of these provisions.

SECTION 7. Sections 2 and 3 of this 2001 Act and the amendments to ORS 743.801 and 750.055 by sections 5 and 6 of this 2001 Act apply to health benefit plans issued or renewed on or after the operative date of sections 2 and 3 of this 2001 Act and the amendments to ORS 743.801 and 750.055 by sections 5 and 6 of this 2001 Act.

SECTION 8. Except as provided in section 9 of this 2001 Act, sections 2 and 3 of this 2001 Act and the amendments to ORS 743.801 and 750.055 by sections 5 and 6 of this 2001 Act become operative on January 1, 2002.

SECTION 9. The Director of the Department of Consumer and Business Services may take any action before the operative date of sections 2 and 3 of this 2001 Act and the amendments to ORS 743.801 and 750.055 by sections 5 and 6 of this 2001 Act that is necessary to enable the director to exercise, on and after the operative date of sections 2 and 3 of this 2001 Act and the amendments to ORS 743.801 and 750.055 by sections 5 and 6 of this 2001 Act, all the duties, functions and powers conferred on the director by sections 2 and 3 of this 2001 Act and the amendments to ORS 743.801 and 750.055 by sections 5 and 6 of this 2001 Act.

SECTION 10. This 2001 Act being necessary for the immediate preservation of the public peace, health and safety, an emergency is declared to exist, and this 2001 Act takes effect on its passage.

Approved by the Governor July 5, 2001

Filed in the office of Secretary of State July 5, 2001

Effective date July 5, 2001

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