Texas Prompt Pay Claims

When pharmacies, doctors, and hospitals submit claims to health insurance companies, the insurance companies have adopted the practice of slow paying.

The marching order of many health insurance companies is DELAY, DELAY, DELAY.

Partial and late payments cost health care providers millions of dollars each year.

There may be a solution to the Health Insurance Conduct.

Texas Prompt Pay Act

In 2003, the Texas Legislature passed the Texas Prompt Pay Act to protect health care providers from insurance companies that habitually make partial and late payments. The Texas Prompt Pay Act protects pharmacies, doctors, and hospitals by providing for statutory penalties, attorney fees, and costs for those who have to wait to get paid in addition to collecting on amounts still owed by insurers.

Haven’t Heard About This Before?

Many health care providers have never heard of the protections provided by the Texas Prompt Pay Act.

This is changing. This year alone hundreds of medical providers are now pursuing their rights under the Texas Prompt Pay Law.

Doctors and Practice Groups

Are the insurance companies routinely paying claims late or underpaying your medical group. If they are you are losing thousands, if not millions, of dollars?

In 2003, the Texas Legislature passed the Prompt Pay Act which assess penalties and fees against insurance companies for late and partial payment on claims.

This Act finally provided doctors and physician practice groups with the ability to seek recompense for faulty, inefficient, and unfair insurance company practices.

When Should the In-House Collection Department be Paid?

Under the Act, an insurance company must pay or deny a claim in whole or in part within 45 days if the claim was submitted in non-electronic form or within 30 days if the claim was submitted in electronic form.

Even if the insurer wants to audit the claim, it must pay in full during the audit. Under certain limited circumstances, the insurer can obtain an extension of the deadlines.

What are the Penalties for Late Payment?

If the insurance company paid after the deadline, you have lost money, even if your claim was eventually paid. The Texas Prompt Pay Act provides attorney fees and costs and statutory penalties as set out below:

• Claim paid within 45 days after the deadline, the penalty is the lesser of:
• $100,000
• 50% of the difference between the billed and the contracted rate
• Claim paid 46-91 days after the deadline, the penalty is the lesser of:
• $200,000
• 100% of the difference between the billed and the contracted rate
• Claim paid 91-270 days after the deadline, the penalty is:
• The lesser of $200,000 or 100% of the difference between the billed and the contracted rate PLUS
• 18 percent annual interest on that amount, accruing from the date payment was due

What are the Penalties for Underpayment?

Sometimes the insurance company will only partially pay a fully payable claim and then at some point after the deadline pay the remaining balance. The Texas Prompt Pay Act provides attorney fees and costs and penalties for underpayments.

• Claim paid within 45 days after the deadline, the penalty is the lesser of:
• $100,000
• 50% of the underpaid amount
• Claim paid 46-91 days after the deadline, the penalty is the lesser of:
• $200,000
• 100% of the underpaid amount
• Claim paid 91-270 days after the deadline, the penalty is:
• The lesser of $200,000 or 100% of the underpaid amount PLUS
• 18 percent annual interest on that amount, accruing from the date full payment was due

If you need assistance pursuing Texas Prompt Payment Act Claim or just have a question amount Prompt Pay Laws, call Attorney Paul Sadler with the Carabin Shaw Law Firm at 800-862-1260.

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