Prompt-payment laws: How to close the loopholes

A new survey asks physicians to track how quickly specific claims are paid. The information will be used to beef up regulation and enforcement of prompt-pay laws.

Editorial. Dec. 2, 2002.

Thanks in part to the 25,000 physicians nationwide who filled out surveys developed by the AMA's Private Sector Advocacy area to track the extent of delayed claims payment, 47 states now have prompt-payment laws. Those laws give insurers a deadline to reimburse physicians for submitted claims. The surveys, which have been distributed through local and state medical societies and analyzed by the AMA since 1998, also have been useful in efforts to close loopholes in existing prompt-payment laws.

The laws, and their revisions, have had some beneficial effect. Physicians report in the surveys that most health plans have reduced the average of 90 to 120 days they once took to pay a claim. For the most part, however, those plans still fall outside the 15- to 45-day deadline required under state prompt-payment laws.

Even in states where insurance departments are aggressive in enforcing the law -- states such as Georgia, New Jersey, Ohio and Texas -- physicians often still find themselves begging to be paid for their work. In Oregon, the state medical association on July 1 delivered to insurance regulators 103 complaints alleging insurer violations of the law since it was passed last year.

A collective $33 million in fines and restitutions paid by insurers nationwide hasn't stopped them from using every loophole they can find -- such as hiding behind the "clean claim" provision of the law by saying that a claim is not filled out correctly or making partial payments on a claim. [...]