Health care claims reimbursement., the official text

An act to add Section 1371.21 to the Health and Safety Code, and to add Section 10123.134 to the Insurance Code, relating to health care coverage.

LEGISLATIVE COUNSEL'S DIGEST

Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care, and makes a willful violation of the act a crime. Existing law provides for the regulation of health insurers by the Department of Insurance. Existing law requires a health care service plan or health insurer to reimburse a complete claim or a portion thereof within 30 calendar days after receipt of the claim, or, if a claim or portion thereof does not meet the criteria for completeness, to notify the claimant no later than 30 calendar days after receipt that the claim or portion thereof is contested or denied.
This bill would grant a provider 90 days to submit a corrected claim after a health care service plan or health insurer denies a claim or sends a notice of overpayment for a claim based a defect that may be remedied by submitting a corrected claim. The bill would prohibit a plan or insurer from denying a corrected claim on the grounds that the provider did not submit the claim within another applicable claim filing deadline. Because a willful violation of these provisions by a health care service plan would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.

The people of the State of California do enact as follows:

SECTION 1.
Section 1371.21 is added to the Health and Safety Code, to read:
1371.21.
(a) Notwithstanding any other law, if a health care service plan denies a claim or sends a notice of overpayment for a claim based in whole or in part on a defect that may be remedied by submitting a corrected claim, the provider shall have 90 days from the plan’s most recent action to submit a corrected claim.
(b) A plan shall not deny a corrected claim submitted pursuant to this section and in accordance with subdivision (a) on the grounds that the provider did not submit the claim within an applicable claim filing deadline other than the deadline specified in subdivision (a).

SEC. 2.
Section 10123.134 is added to the Insurance Code, to read:
10123.134.
(a) Notwithstanding any other law, if a health insurer denies a claim or sends a notice of overpayment for a claim based in whole or in part on a defect that may be remedied by submitting a corrected claim, the provider shall have 90 days from the insurer’s most recent action to submit a corrected claim.
(b) An insurer shall not deny a corrected claim submitted pursuant to this section and in accordance with subdivision (a) on the grounds that the provider did not submit the claim within an applicable claim filing deadline other than the deadline specified in subdivision (a).

SEC. 3.
No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.