Report Title:

Accident and Health or Sickness Insurance Providers; Prompt Payment

Description:

Makes reimbursement for accident and health or sickness insurance benefits final and irrevocable. Allows an entity to seek a refund of any reimbursement within certain time limitations and upon the satisfaction of certain criteria. Limits the return of any refund by offsetting it against amounts owed to the provider for unpaid claims.

THE SENATE

S.B. NO.

941

TWENTY-THIRD LEGISLATURE, 2005

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to unfair practices in the insurance business.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Section 431:13-108, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) Unless shorter payment timeframes are otherwise specified in a contract, an entity shall reimburse a claim that is not contested or denied not more than thirty calendar days after receiving the claim filed in writing, or fifteen calendar days after receiving the claim filed electronically, as appropriate. Such reimbursement shall be final and irrevocable, except as provided below:

(1) An entity, pursuant to procedures provided by the commissioner, may seek a refund of any reimbursement for a period not to exceed the number of days in the limitation period the entity imposed on the health care provider's submission of the claim from the date of service, as follows:

(A) By stipulated agreement with the health care provider:

(B) Upon proof of mutual mistake as to an element of the claim determined by the commissioner to be material to the value of the services provided;

(C) Upon proof of unilateral mistake as to an element of the claim determined by the commissioner to be material to the value of the services provided, and under circumstances in which the commissioner determines the health care provider knew or should have known of the entity's unilateral mistake; or

(D) Upon a determination by the commissioner, based on clear and convincing evidence, that the claim on which the entity seeks a refund was false or fraudulent; and

(2) Until such time as the commissioner's decision on the refund is filed, the entity may not obtain any portion of the refund amount through offsetting against undisputed claims or other such means, except pursuant to an express agreement by the health care provider obtained after the demand for refund is made, or by order of the commissioner, which order shall be issued only if the commissioner is:

(A) Satisfied that the offset will not result in any material change in the health care provider's ability to continue providing services or benefits to the entity's enrollees, as required by section 432E-7(b);

(B) Probable validity exists to sustain the validity of the entity's claim; and

(C) The health care provider is about to relocate and remove all property from the State or is about to or has fraudulently hidden or withheld money, property, or effects, which should be liable to the satisfaction of the refund amount, and is unable to post a satisfactory bond.

The rights and obligations of this section may not be waived by contract or agreement except as provided herein."

SECTION 2. New statutory material is underscored.

SECTION 3. This Act shall take effect upon its approval.

INTRODUCED BY:

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