PRIOR PRINTER'S NO. 3704
PRINTER'S NO. 3858
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
2241
Session of
2015
INTRODUCED BY BOBACK, PICKETT, DeLUCA, D. COSTA AND D. PARKER,
JULY 1, 2016
AS REPORTED FROM COMMITTEE ON INSURANCE, HOUSE OF
REPRESENTATIVES, AS AMENDED, SEPTEMBER 19, 2016
AN ACT
Amending Title 40 (Insurance) of the Pennsylvania Consolidated
Statutes, in regulation of insurers and related persons
generally, providing for retroactive denial of
reimbursements.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 40 of the Pennsylvania Consolidated
Statutes is amended by adding a chapter to read:
CHAPTER 37
RETROACTIVE DENIAL OF REIMBURSEMENTS
Sec.
3701. Scope of chapter.
3702. Definitions.
3703. Retroactive denial of reimbursement.
3704. Exceptions to retroactive denial of reimbursement.
3705. Coordination of benefits.
3706. Tolling.
§ 3701. Scope of chapter.
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This chapter shall not apply to reimbursements made as part
of an annual contracted reconciliation of a risk-sharing
arrangement under an administrative service provider contract.
§ 3702. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Abuse." Incidents or practices of providers, physicians or
suppliers of services and equipment which are inconsistent with
accepted sound medical, business or fiscal practices.
" Fraud. " Any activity defined as an offense under 18 Pa.C.S.
§ 4117 (relating to insurance fraud).
" Health care provider. " A person, corporation, facility,
institution or other entity licensed, certified or approved by
the Commonwealth to provide health care or professional medical
services. The term includes, but is not limited to, a physician,
chiropractor, optometrist, professional nurse, certified nurse-
midwife, podiatrist, hospital, nursing home, ambulatory surgical
center or birth center.
" Insurer. " A health insurance entity licensed in this
Commonwealth to issue any individual or group health, sickness
or accident policy or subscriber contract or certificate that
provides medical or health care coverage by a health care
facility or licensed health care provider that is offered or
governed under any of the following:
(1) The act of May 17, 1921 (P.L.682, No.284), known as
The Insurance Company Law of 1921 , INCLUDING SECTION 630 AND
ARTICLE XXIV THEREOF .
(2) The act of December 29, 1972 (P.L.1701, No.364),
known as the Health Maintenance Organization Act.
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(3) The act of May 18, 1976 (P.L.123, No.54), known as
the Individual Accident and Sickness Insurance Minimum
Standards Act.
(4) Chapter 61 (relating to hospital plan corporations)
or 63 (relating to professional health services plan
corporations).
" Reimbursement. " Payments made to a health care provider by
an insurer.
"Waste." The overutilization of professional medical
services or the misuse of resources by a health care provider.
§ 3703. Retroactive denial of reimbursement.
(a) General rule.--Except as provided in section 3704
(relating to exceptions to retroactive denial of reimbursement),
an insurer may not retroactively deny reimbursement as a result
of an overpayment determination more than 24 months after the
date the insurer initially paid the health care provider. An
insurer that retroactively denies reimbursement to a health care
provider under this chapter shall do so based upon coding
guidelines and policies in effect at the time the service
subject to the retroactive denial was rendered.
(b) Written notice.--An insurer that retroactively denies
reimbursement to a health care provider under subsection (a)
shall provide the health care provider with a written statement
specifying the basis for the retroactive denial. If the
retroactive denial of reimbursement results from coordination of
benefits, the written statement shall provide the name and
address of the entity responsible for payment of the denied
claim.
§ 3704. Exceptions to retroactive denial of reimbursement.
The provisions of section 3703 (relating to retroactive
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denial of reimbursement) do not apply if an insurer
retroactively denies reimbursement to a health care provider
because any of the following apply:
(1) The information submitted to the insurer constitutes
fraud, waste or abuse as defined in this chapter.
(2) The claim submitted to the insurer was a duplicate
claim.
(3) Denial was required by a Federal or State government
plan.
(4) Services were subject to coordination of benefits
with another insurer, the medical assistance program or the
Medicare program.
§ 3705. Coordination of benefits.
If an insurer retroactively denies reimbursement for services
as a result of coordination of benefits under the provisions of
section 3704(4) (relating to exceptions to retroactive denial of
reimbursement), the health care provider shall have 12 months
from the date of the denial, unless the entity responsible for
payment permits a longer time period , to submit a claim for
reimbursement for the service to such entities.
§ 3706. Tolling.
An insurer may request medical or billing records in writing
from a health care provider under section 3703 (relating to
retroactive denial of reimbursement). The health care provider
shall provide the necessary records to the insurer within 60
days of the request. The period of time in which the health care
provider is gathering the requested documentation shall be added
to the 24-month period.
Section 2. This act shall take effect in 60 days.
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