TITLE insurance

Part I. Texas Department of Insurance

Chapter 7. Corporate and Financial Regulation

Subchapter A. Examination and Financial Analysis

28 TAC §7.36

(Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas Department of Insurance or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The Texas Department of Insurance proposes the repeal of §7.36 concerning reports workers' compensation insurers are required to file with the Texas Department of Insurance on or before June 30th of the year following the year audited. The existing §7.36 was adopted pursuant to the enactment of Texas Insurance Code, Article 5.61. That Article required workers' compensation insurers to provide the Texas Department of Insurance a separate CPA report showing its year-end loss, expense, and unearned premium reserves for workers' compensation results in this state.

The repeal of this section is necessary to eliminate an unnecessary provision, as Texas Insurance Code Annotated Article 5.61, as amended by Acts 1999, 76th Legislature, chapter 1426, §19, effective September 1, 1999, no longer imposes such a mandate upon workers' compensation insurers.

Ms. Betty Patterson, Associate Commissioner for the Financial Program, has determined that, for the first five years the repeal is in effect, there will be no fiscal implications for state or local government as a result of this repeal, and there will be no effect on local employment or local economy.

Ms. Patterson has also determined that, for each year of the first five years the repeal of the section is in effect, the public benefit will be that the rules will reflect recent changes in State law and provide for the efficient regulation of insurance. The repeal of this rule will reduce workers' compensation insurers' regulatory costs, as such companies will no longer be required to obtain a CPA audit report relating to their Texas workers' compensation reserves. Associated administrative burdens for these insurers will also be eliminated since these insurers will no longer have to file the audit report with the Texas Department of Insurance. There are no anticipated economic costs associated with this repeal since it does not impose any regulatory burdens. Rather, workers' compensation insurers will benefit from the elimination of the report requirement through a reduction in costs.

Comments on the proposal must be submitted in writing within 30 days after publication of the proposal in the Texas Register to Lynda Nesenholtz, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comments should be submitted to Betty Patterson, Associate Commissioner - Financial Program, Mail Code 305-2A, P. O. Box 149104, Austin, Texas 78714-9104.

The repeal is proposed under the Insurance Code, Articles 1.03A, 5.61, and 5.62; and Texas Government Code, §§2001.004-2001.038. Article 1.03A authorizes the Commissioner to adopt rules for the conduct and execution of the duties and functions of the Department only as authorized by statute for general and uniform application. Article 5.61 now only governs the maintenance of reserves securing the solvency of workers' compensation insurers. Article 5.62 authorizes the commissioner to make and enforce all such reasonable rules and regulations not inconsistent with the provisions of Chapter 5 Subchapter D of the Insurance Code. Texas Government Code, §§2001.004-2001.038, authorize and require each state agency to adopt rules of practice setting forth the nature and requirement of available procedures, and prescribe the procedures for adoption of rules by a state administrative agency.

The following are the articles of the Insurance Code that are affected by this section: Articles 1.03A, 1.15A, 5.61, and 5.62.

§7.36. Report on Audit of Workers' Compensation Reserves.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on July 20, 1999.

TRD-9904372

Lynda H. Nesenholtz

General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: September 5, 1999

For further information, please call: (512) 463-6327


Chapter 21. Trade Practices

Subchapter T. Submission of Clean Claims

28 TAC §§21.2801 - 21.2809

The Texas Department of Insurance proposes new §§21.2801 - 21.2809, concerning submission of clean claims to health maintenance organizations (HMOs) and insurers who issue preferred provider benefit plans. These sections are the result of the passage of House Bill 610 during the 76th Legislative Session. House Bill 610 provides for claims payment decisions on claims submitted by contracted providers to HMOs and preferred provider carriers within 45 days of the submission of a "clean claim." It also provides that department rules shall determine when a claim is complete, thus constituting a clean claim.

Proposed §21.2801 sets forth the scope of these proposed sections, namely their applicability to claims submitted by contracted physicians or providers of HMOs and preferred provider carriers. Nothing in these sections should be construed as obviating the duty of health care plans to promptly and efficiently process claims submitted by insureds, enrollees, and non-contracted physicians or providers. The department anticipates that HMOs and preferred provider carriers will bring physician or provider contracts, and/or physician or provider manuals or other documents that set forth the procedure for filing claims with the HMO or preferred provider carrier, into compliance with these rules by December 15, 1999. This compliance date will allow HMOs and plans sufficient time to notify physicians and providers of any attachments or additional clean claim requirements without requiring immediate revision of contracts or provider manuals. Proposed §21.2802 defines terms used in these rules. Where possible, existing definitions of terms were incorporated by reference to their statutory or regulatory origin. Since "clean claim," had not previously been defined, a new definition was developed.

Proposed §21.2803 further develops the elements of a clean claim. A clean claim consists of specified data elements utilized on Health Care Financing Administration (HCFA) claim forms, attachments specified by contract or proper notice, additional elements that are identified by contract or proper notice, and in coordination of benefit or patient eligibility situations, if specified by contract, the amount of the claim paid by the primary plan. Electronic claims submissions are in no way precluded by these proposed sections. After the 1997 Legislative Session, HMOs and preferred provider carriers were required to pay claims submitted by physicians or providers within 45 days. The "trigger" for the running of the prompt payment period was the receipt of a claim for payment "with the documentation reasonably necessary to process the claim." In practice, the issue of what documentation was reasonably necessary to process a claim resulted in numerous disputes between HMOs and preferred provider carriers and the physicians or providers submitting claims. These sections are designed to diminish the frequency of such disputes, by requiring prior notification to physicians and providers of documentation considered reasonably necessary to process a claim (i.e., what constitutes a clean claim).

These sections are not intended to address the validity or the viability of a submitted claim. Instead, these sections are meant to put physicians, providers, HMOs and preferred provider carriers all on the same page with regard to documentation considered reasonably necessary to process a claim. Any question as to the completeness of a claim should be able to be answered by reference to the physician or provider contract, manual and/or other document that sets forth the procedure for filing claims, and pertinent notifications. If coordination of benefits or patient eligibility for coverage is an issue, information regarding these situations may be contractually required as clean claim elements. The patient eligibility scenario may arise in an instance where a preferred provider carrier questions whether an insured has a preexisting condition, but that insured's current physician does not have the insured's past medical records or other information from which a preexisting condition determination could be made. From the point that a clean claim is received, an HMO or preferred provider carrier has 45 days in which to make the claim payment decision.

Proposed §21.2804 requires that, if attachments beyond those identified in the physician or provider contracts, or in the physician or provider manual or other document that sets forth the procedure for filing claims with the HMO or preferred provider carrier, are to be required, then the HMO or preferred provider carrier must give 60-day prior written notice to the affected physicians or providers. Proposed §21.2805 provides that, if additional elements beyond those identified in the physician or provider contracts, or in the physician or provider manual or other document that sets forth the procedure for filing claims with the HMO or preferred provider carrier, are to be required, then the HMO or preferred provider carrier must give 60-day prior written notice to the affected physicians or providers. Proposed §21.2806 specifies that filing of a clean claim starts the running of the 45-day prompt payment of claims decision period.

A clean claim is considered filed when received at the address designated by the HMO or preferred provider carrier.

Proposed §21.2807 identifies the administrative claim filing information that must be disclosed by HMOs and preferred provider carriers in their physician or provider contracts or in the physician or provider manual or other document that sets forth the procedure for filing claims with the HMO or preferred provider carrier. If the administrative claims filing information is revised, the HMO or preferred provider carrier must give its physicians or providers 60-day written notice prior to the change. Proposed §21.2808 prohibits the denial of a claim based upon a physician's or provider's filing of the claim at an incorrect address, unless the 60-day prior written notice has been provided. Finally, proposed §21.2809 requires that an HMO or preferred provider carrier that delegates its claims processing functions include in its delegation agreement a provision requiring the delegated claims processor to comply with the clean claims requirements. Claims that are delegated for processing remain subject to the statutory 45-day claims processing period.

The department will consider the adoption of new §§21.2801 - 21.2809 concerning submission of clean claims to HMOs and preferred provider carriers in a public hearing under Docket No. 2415, scheduled for September xx, 1999 in Room 100 of the William P. Hobby Jr. State Office Building, 333 Guadalupe Street in Austin, Texas. The department encourages any interested party to provide the department with any comments prior to the hearing or at the hearing.

Kim Stokes, Associate Commissioner, Life/Health and Managed Care, Regulation and Safety, has determined that for each year of the first five years the proposal is in effect, there will be no fiscal implications for state or local government as a result of enforcing or administering the proposed sections. There will be no adverse effects on local employment or the local economy.

Ms. Stokes has determined that for each year of the first five years the proposal is in effect the public benefits anticipated as a result of the adoption of the proposal will be a reduction in claim payment disputes between physicians or providers and HMOs or preferred provider carriers. By providing clear and specific notice of the elements of a clean claim to physicians and providers, the beginning point of the statutory claim payment period is more clearly defined. By reducing the number of disputes regarding claim payment issues, these sections allow physicians, providers, HMOs, preferred provider carriers, and regulators to devote their energies to enrollee issues.

The economic cost to comply with these proposed sections is the result of the legislative enactment of House Bill 610. These proposed sections do not mandate any action not contemplated by HB610, and therefore impose no costs other than those imposed by the new legislation.

Ms. Stokes has determined that there is no economic costs or adverse impact for each year of the first five years on any small or micro-business HMOs or preferred provider carriers that are a result of these proposed new sections. The determining factor in the costs that would be incurred by an HMO or a preferred provider carrier is the number of physicians or providers with whom that HMO or preferred provider carrier contracts, and not upon the size of the HMO or preferred provider carrier. The size of the business thus has no bearing upon the applicability of these proposed sections. Under these proposed sections, an HMO or preferred provider organization may incorporate the clean claim elements into physician or provider contracts, physician or provider manuals or other document that sets forth claim processing procedures, or provide 60-day notice of clean claim element revisions. Thus, by allowing an HMO or preferred provider carrier to select the form of notification, these proposed sections allow an HMO or preferred provider carrier of any size to determine costs that it will incur as a result of HB610. Moreover, it is neither legal nor feasible to exempt small or micro-business HMOs or preferred provider carriers from the requirements of these proposed sections. The requirements of these proposed sections should not be waived.

Comments on the proposal must be submitted within 30 days after publication of the proposed sections in the Texas Register to Lynda H. Nesenholtz, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas, 78714-9104. Additional copies of the comment are to be submitted to Kim Stokes, Associate Commissioner, Life/Health and Managed Care, Regulation and Safety, Mail Code 103-6A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas, 78714-9104.

These new sections are proposed under the Insurance Code Articles 3.70-3C, §§3(m) and 9; 20A.09(j); 20A.22 and 1.03A. Insurance Code Article 3.70-3C, §3(m) specifies that a preferred provider contract must provide for prompt payment to a physician or provider for covered services rendered not later than the 45th day after the date a claim for payment is received "with the documentation reasonably necessary to process the claim." Insurance Code Article 3.70-3C, §9 grants the commissioner rulemaking authority to implement the provisions of Article 3.70-3C dealing with preferred provider benefit plans. Insurance Code Article 20A.09(j) specifies that HMOs shall make prompt payment to a physician or provider for covered services rendered not later than the 45th day after the date a claim for payment is received "with documentation reasonably necessary for the HMO to process the claim." Article 20A.22(a) grants the commissioner rulemaking authority to carry out the provisions of the HMO Act. Furthermore, House Bill 610, passed by the 76th Legislature, created new Insurance Code Articles 3.70-3C, §3A(a) and 20A.18B(a), which are effective September 1, 1999. These Articles provide that a clean claim is a "completed claim, as determined under Texas Department of Insurance rules." Article 1.03A provides that the Commissioner of Insurance may adopt rules and regulations to execute the duties and functions of the Texas Department of Insurance only as authorized by statute.

The following articles are affected by this proposal: Insurance Code Articles 3.70-3C, §§3(m) and 3A, 20A.09(j) and 20A.18B.

§21.2801.Scope and Applicability.

This subchapter applies to claims submitted by physicians or providers for covered services or benefits provided to insureds of preferred provider carriers and enrollees of HMOs, for the purpose of determining the starting point for the claims payment period set forth in Insurance Code Article 3.70-3C, §§3(m) and 3A, Article 20A.09(j) and Article 20A.18B.

§21.2802.Definitions.

The following words and terms, when used in this subchapter shall have the following meanings, unless the context clearly indicates otherwise:

(1)

Clean claim -- A physician's or provider's claim for payment with documentation reasonably necessary for the HMO or preferred provider carrier to process the claim, which contains:

(A)

the required data elements set forth in §21.2803(b) of this title (relating to Elements of a Clean Claim);

(B)

the attachments of which the physician or provider has been properly notified as necessary for processing pursuant to §§21.2803(c) and 21.2804 of this title (relating to Disclosure of Necessary Attachments);

(C)

any additional elements of which the physician or provider has been properly notified pursuant to §21.2805 of this title (relating to Disclosure of Additional Clean Claim Elements) , and

(D)

the amount paid by the primary plan pursuant to §21.2803(e) of this title, if applicable.

(2)

Condition code - The code utilized by HCFA to identify conditions that may affect processing of the claim.

(3)

Diagnosis code - The ICD-9-CM code number. Narrative diagnoses for non-physician specialties must be submitted on an attachment.

(4)

HMO - A health maintenance organization as defined by Insurance Code Article 20A.02(n).

(5)

HMO delivery network - As defined by Insurance Code Article 20A.02(w).

(6)

Occurrence span code - The code utilized by HCFA to define a specific event relating to the billing period.

(7)

Patient control number - A unique alphanumeric number assigned by the provider to facilitate retrieval of individual financial records and posting of payment.

(8)

Patient-status-at-discharge code - The code utilized by HCFA to indicate the patient's status at time of discharge or billing.

(9)

Physician or provider -

(A)

with regard to a preferred provider carrier, a preferred provider as defined by Insurance Code Article 3.70-3C, Section 1(10) (Preferred Provider Benefit Plans).

(B)

with regard to an HMO,

(i)

a physician, as defined by Insurance Code Article 20A.02(r), who is a member of that HMO's delivery network; or

(ii)

a provider, as defined by Insurance Code Article 20A.02(t), who is a member of that HMO's delivery network.

(10)

Place of service code - The codes utilized by HCFA that identifies the place at which the service was rendered.

(11)

Preferred provider carrier - An insurer that issues a preferred provider benefit plan as provided for by Insurance Code Article 3.70-3C, Section 2.

(12)

Primary Plan - As defined in §3.3506 of this title (relating to Use of the Terms "Plan," "Primary Plan," "Secondary Plan," and "This Plan" in Policies, Certificates and Contracts).

(13)

Procedure Code - The HCFA Common Procedure Coding System (HCPCS) number.

(14)

Revenue code - The code assigned by HCFA to each cost center for which a separate charge is billed.

(15)

Secondary Plan - As defined in §3.3506 of this title.

(16)

Source of admission code - The code utilized by HCFA to indicate the source of an inpatient admission.

(17)

Subscriber - If individual coverage, the individual who is the contract holder and is responsible for payment of premiums to the HMO or preferred provider carrier; or if group coverage, the individual who is the certificate holder and whose employment or other membership status, except for family dependency, is the basis for eligibility for enrollment in the HMO or coverage by the preferred provider carrier.

(18)

Type of bill code - The three-digit alphanumeric code utilized by HCFA to identify type of facility, type of care, and sequence of bill in a particular episode of care.

§21.2803.Elements of a Clean Claim.

(a)

Required claim elements. A physician or provider submits a clean claim by providing the required data elements specified in subsection (b) of this section to an HMO or a preferred provider carrier, along with any attachments and additional elements of which the physician or provider has been properly notified as necessary pursuant to subsections (c) and (d) of this section, and §§21.2804 (relating to Disclosure of Necessary Attachments), and 21.2805 of this title (relating to Disclosure of Additional Clean Claim Elements), and any coordination of benefits or patient eligibility information contracted for pursuant to subsection (e) of this section, if applicable. Electronic claims submissions remain permissible under this subchapter.

(b)

Required data elements. The Health Care Financing Administration (HCFA) of the U.S. Department of Health and Human Services has developed claim forms which provide much of the information necessary to process claims. Two of these forms, HCFA-1500 (12-90) and UB-92 HCFA-1450, and their successor forms, have been identified by Insurance Code Article 21.52C as required for the submission of certain claims. The terms used in paragraphs (1), (2) and (3) of this subsection are based upon the terms used by HCFA on the HCFA-1500 (12-90) and UB-92 HCFA-1450 claim forms. The parenthetical information following each term is a reference to the applicable HCFA claim form, and the field number to which that term corresponds on the HCFA claim form.

(1)

Necessary data elements for individual physicians or providers. The information in this paragraph is necessary for claims filed by physicians and providers that utilize the HCFA-1500 (12-90) claim form.

(A)

subscriber's/patient's plan ID number (HCFA 1500, field 1a);

(B)

patient's name (HCFA 1500, field 2);

(C)

patient's date of birth and gender (HCFA 1500, field 3);

(D)

patient's address (street or P.O. Box, city, zip) (HCFA 1500, field 5);

(E)

whether patient's condition is related to employment, auto accident, or other accident (HCFA 1500, field 10);

(F)

subscriber's birth date and gender (HCFA 1500, field 11a);

(G)

subscriber's plan name (employer, school, etc.) (HCFA 1500, field 11b);

(H)

HMO or insurer name (HCFA 1500, field 11c);

(I)

disclosure of any other health benefit plans (HCFA 1500, field 11d);

(J)

patient's or authorized person's signature (HCFA 1500, field 12);

(K)

subscriber's or authorized person's signature (HCFA 1500, field 13);

(L)

date of current illness, injury, or pregnancy (HCFA 1500, field 14);

(M)

list of all diagnosis codes upon claim form (HCFA 1500, field 21);

(N)

date(s) of service (HCFA 1500, field 24A);

(O)

place of service codes (HCFA 1500, field 24B);

(P)

type of service (HCFA 1500, field 24C);

(Q)

procedure code (HCFA 1500, field 24D);

(R)

diagnosis code by specific service (HCFA 1500, field 24E);

(S)

charge for each listed service (HCFA 1500, field 24F);

(T)

number of days or units (HCFA 1500, field 24G);

(U)

physician's or provider's federal tax ID number (social security number or employer identification number) (HCFA 1500, field 25);

(V)

whether assignment was accepted (HCFA 1500, field 27);

(W)

total charge (HCFA 1500, field 28);

(X)

signature of physician or supplier (HCFA 1500, field 31);

(Y)

name and address of facility where services rendered (if other than home office) (HCFA 1500, field 32); and

(Z)

physician's or provider's billing name and address (HCFA 1500, field 33).

(2)

Necessary data elements for institutional providers. The information in this paragraph is necessary for claims filed by institutional providers that utilize the UB-92 HCFA-1450 claim form.

(A)

provider name, address and telephone number (UB-92, field 1);

(B)

patient control number (UB-92, field 3);

(C)

type of bill code (UB-92, field 4);

(D)

provider's federal tax ID number (UB-92, field 5);

(E)

statement covers period (beginning and ending date of claim period) (UB-92, field 6);

(F)

covered days (UB-92, field 7);

(G)

noncovered days (UB-92, field 8);

(H)

coinsurance days (UB-92, field 9);

(I)

lifetime reserve days (inpatient only) (UB-92, field 10);

(J)

patient's name (UB-92, field 12);

(K)

patient's address ((UB-92, field 13);

(L)

patient's date of birth (UB-92, field 14);

(M)

patient's gender (UB-92, field 15);

(N)

date of admission (UB-92, field 17);

(O)

hours of admission (UB-92, field 18);

(P)

type of admission (e.g. emergency, urgent, elective, newborn) (UB-92, field 19);

(Q)

source of admission code (UB-92, field 20);

(R)

discharge hour (UB-92, field 21);

(S)

patient's status at discharge code (UB-92, field 22);

(T)

condition codes (UB-92, fields 24-30);

(U)

occurrence span code, from and through dates (UB-92, field 36);

(V)

revenue code (UB-92, field 42);

(W)

HCPCS/Rates (UB-92, field 44);

(X)

units of service (UB-92, field 46);

(Y)

total charge (UB-92, field 47);

(Z)

noncovered charges (UB-92, field 48);

(AA)

payor name (UB-92, field 50);

(BB)

provider number (UB-92, field 51);

(CC)

prior payments - payor and patient (UB-92, field 54);

(DD)

patient's/subscriber's certificate number, social security number, health claim number, ID number (UB-92, field 60);

(EE)

treatment authorization codes (UB-92, field 63);

(FF)

principle diagnosis code (UB-92, field 67);

(GG)

admission diagnosis code (inpatient only) (UB-92, field 76); and

(HH)

signature of provider representative (UB-92, field 85).

(3)

Conditional data elements. The Information in this paragraph is necessary only on those claims in which these data elements are present.

(A)

other insured's or enrollee's name (HCFA 1500, field 9);

(B)

other insured's or enrollee's policy/group number (HCFA 1500, field 9a);

(C)

other insured's or enrollee's date of birth (HCFA 1500, field 9c);

(D)

other insured's or enrollee's plan name (employer, school, etc.) (HCFA 1500, field 9c);

(E)

other insured's or enrollee's HMO or insurer name (HCFA 1500, field 9d);

(F)

prior authorization number (HCFA 1500, field 23);

(G)

amount paid (HCFA 1500, field 29);

(H)

balance due (HCFA 1500, field 30);

(I)

diagnoses codes other than principle diagnosis code ((UB-92, fields 68-75);

(J)

procedure coding methods used (UB-92, field 79);

(K)

principle procedure code (UB-92, field 80); or

(L)

other procedure codes (UB-92, field 81).

(c)

Attachments. In addition to the required data elements set forth in subsection (b) of this section, HCFA has developed a variety of manuals that identify various attachments required of different physicians or providers for specific services. An HMO or a preferred provider carrier may use the appropriate Medicare standards for attachments in order to properly process claims for certain types of services. Before any attachments may be required, the HMO or preferred provider carrier must satisfy the notification procedures set forth in §21.2804 of this title (relating to Disclosure of Necessary Attachments).

(d)

Additional clean claim elements. Additional elements beyond the required data elements and attachments identified in subsections (b) and (c) of this section may be required. Before any additional clean claim elements may be required, the HMO or the preferred provider carrier must satisfy the notification procedures set forth in §21.2805 of this title (relating to Disclosure of Additional Clean Claim Elements).

(e)

Coordination of benefits and patient eligibility clean claim requirements.

(1)

If a claim is submitted for covered services or benefits in which coordination of benefits pursuant to §§3.3501 - 3.3511 of this title (relating to Group Coordination of Benefits) is necessary, the secondary plan may by contract require as an element of a clean claim, from the physician or provider, the amount paid by the primary plan.

(2)

If an HMO or preferred provider carrier establishes a good-faith, reasonable doubt that the claim submitted involved treatment or services provided to a patient that was not eligible for coverage for those services from the HMO or preferred provider carrier, the HMO or preferred provider carrier may by contract require as an element of a clean claim the information necessary to determine the eligibility of the patient for coverage. In such a situation, the HMO or preferred provider must make a reasonable effort to resolve all questions of eligibility within their control. Upon request, the HMO or preferred provider carrier must timely submit for review by the physician or provider all specific information that casts doubt on the patient's eligibility under the claim.

(f)

Format of elements. The required elements of a clean claim set forth in subsections (b), (c), (d) and (e), if applicable, of this section must be complete, legible and accurate.

(g)

Signature on file. The original signatures of patients, subscribers, physicians and providers, or their authorized representatives, required by subparagraphs (J), (K), and (X) of subsection (b)(1) of this section and subparagraph (HH) of subsection (b)(2) of this section are not necessary if original signatures are on file with the physician or provider.

§21.2804.Disclosure of Necessary Attachments.

For attachments described in §21.2803(b) of this title (relating to Elements of a Clean Claim) to be required as part of a clean claim, the HMO or preferred provider carrier must provide advance written notice to all affected physicians or providers that such attachments are necessary. Such notice must identify with specificity the attachment(s) required and must be received by the physician or provider at least 60 days before requiring such attachment as an element of a clean claim. If an attachment is identified as a required element of a clean claim in the contract between the HMO or preferred provider carrier and the physician or provider, or in the physician or provider manual or other document that sets forth the procedure for filing claims with the HMO or preferred provider carrier, then additional written notice is not required. If an HMO or preferred provider carrier requests an attachment not identified in the contract between the HMO or preferred provider carrier and the physician or provider, or in the physician or provider manual or other document that sets forth the procedure for filing claims with the HMO or preferred provider carrier, or for which written notice has not been provided as required by this section, the request will not extend the claim payment period.

§21.2805.Disclosure of Additional Clean Claim Elements.

An HMO or preferred provider carrier may include in its contracts with physicians or providers a provision to require additional elements for clean claims. To require such additional elements as part of a clean claim, the HMO or preferred provider carrier must provide advance written notice to all affected physicians or providers that such additional elements are necessary. Such notice must identify with specificity the additional elements required, and must be received by the physician or provider at least 60 days before requiring such additional elements as a requirement of a clean claim. If an element beyond the required data elements and attachments identified in §21.2803(b) and (c) of this title (relating to Elements of a Clean Claim) is identified as a required element of a clean claim in the contract between the HMO or preferred provider carrier and the physician or provider, or in the physician or provider manual or other document that sets forth the procedure for filing claims with the HMO or preferred provider carrier, then additional written notice is not required. If an HMO or preferred provider carrier requires resubmission of a claim with additional clean claim elements not identified in the contract between the HMO or preferred provider carrier and the physician or provider, or in the physician or provider manual or other document that sets forth the procedure for filing claims with the HMO or preferred provider carrier, or for which written notice has not been provided as required by this section, the request will not extend the claim payment period.

§21.2806.Effect of Filing a Clean Claim.

The claims payment period begins to run upon receipt of a clean claim from a physician or provider at the address designated by the HMO or preferred provider carrier, whether it be the address of the HMO, preferred provider carrier, or a delegated claims processor.

§21.2807.Disclosure of Processing Procedures.

(a)

In contracts with physicians or providers, or in the physician or provider manual or other document that sets forth the procedure for filing claims, an HMO or preferred provider carrier must disclose to its physicians and providers:

(1)

the address where claims should be sent for processing;

(2)

the phone number at which physicians' and providers' questions and concerns regarding claims may be addressed;

(3)

any entity to which the HMO or preferred provider carrier has delegated claim payment functions, if applicable; and

(4)

the address of any separate claims processing centers for specific types of services, if applicable.

(b)

An HMO or preferred provider carrier shall provide no less than 60 days prior written notice of any changes of address for submission of claims, and of any changes of delegation of claims payment functions, to all affected physicians and providers with whom the HMO or preferred provider carrier has contracts.

§21.2808.Denial of Claims Prohibited for Change of Address or Administrator.

After a change of claims payment address or a change in delegation of claims payment functions, an HMO or preferred provider carrier may not premise the denial of a claim upon a physician's or provider's failure to file a claim within any contracted time period for claim filing, unless timely written notice as required by §21.2807(b) of this title (relating to Disclosure of Processing Procedures) has been given.

§21.2809.Requirements Applicable to Delegated Claims Processors.

If an HMO or preferred provider carrier has delegated its claims processing functions to a third party, the delegation agreement must provide that the claims processing entity will comply with the requirements of this subchapter.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on July 26, 1999.

TRD-9904478

Gene C. Jarmon

Assistant General Counsel

Texas Department of Insurance

Earliest possible date of adoption: September 5, 1999

For further information, please call: (512) 463-6327