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AMA News Room

March 25, 2013

AMA and MAG Support Georgia Insurance Commissioner’s Defense of Prompt-Pay Law

For immediate release:
March 25, 2013

AMA and MAG

ATLANTA - The American Medical Association (AMA) and the Medical Association of Georgia (MAG) have filed a friend-of-the-court brief in federal court backing Georgia's authority to regulate unfair business practices by companies hired to pay medical bills.

The medical societies support an appeal by Georgia's Insurance Commissioner Ralph Hudgens seeking to overturn a court injunction barring full enforcement of the state's Insurance Delivery Enhancement Act of 2011. The law, which the Georgia legislature passed overwhelmingly, expanded the state's requirement for timely payment of medical bills to include third-party administrators that provide medical claim processing services to employers.

The medical societies' brief, filed in the U.S. Eleventh Circuit Court of Appeal, argues the trial court erred in concluding that the federal Employee Retirement Income Security Act (ERISA) exempts third-party administrators from accountability to Georgia's prompt payment law. The AMA and MAG urged the federal appeals court to lift the injunction and declare that Georgia's prompt payment law is not preempted by ERISA, or remand the case so the ERISA preemption issues can be properly addressed in court.

"Due to the unnecessary injunction, Georgia's prompt payment law is only regulating 35 percent of the state's health benefits market," said AMA President Jeremy A. Lazarus, M.D. "This leaves a regulatory void where the state's third-party administrators are unaccountable for chronically late payments, and it jeopardizes a sustainable practice environment for Georgia's physicians."

"The Medical Association of Georgia believes that it is imperative for the state's prompt pay law to be upheld in court to ensure that physicians have the budget certainty they need to run a sustainable practice," says MAG President W. Scott Bohlke, M.D. "This comes down to doing what's fair and what's right and making sure physicians get the money they've earned by caring for their patients who are covered by a third-party administrator of an employer-funded health insurance plan on time so they can, in turn, pay their employees and bills on time."

The brief in this important case was made possible due to the dedicated work of the Litigation Center of the AMA and State Medical Societies, a legal action coalition consisting of the AMA and medical societies from each state plus the District of Columbia.

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Media Contacts:

Robert J. Mills
American Medical Association
(312) 464-5970

Tom Kornegay
Medical Association of Georgia
(678) 303-9260

 

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