Prompt Pay Act
The Kansas Health Care Prompt Payment Act went into effect January 1, 2001. This act establishes a framework for prompt payment of health insurance claims.
In general, an insurer has 30 days to pay a clean claim (the insurance company has all information necessary to process the claim) or send a notice to the provider stating why the payment has been delayed or denied. Failure to comply with this portion of the act results in the accrual of interest equal to 1% per month of the billed charges. The interest is payable to the provider, individual, or entity submitting the claim.
An insurer may request additional information on an unpaid claim but must do so within the first 30 days. When the additional information is received, the insurer has 15 days to pay or deny the claim. Again, failure to comply with this portion of the act results in the accrual of interest equal to 1% per month of the billed charges.
For more information:
Which Insurance Plans Are Covered
The law applies to fully insured health plans including plans offered by HMOs. Plans typically covered include individual or group major medical plans and hospital /surgical policies. Organizations such as Third Party Administrators paying claims for fully insured plans must also comply with the new rules.
Which Insurance Plans Are NOT Covered
The law does not apply to any of the following types of health related medical claims. Some plans not covered:
- Self-insured employer plans
- Medicare/Medicare supplement policies
- Workers Compensation
- Federal employee plans
- Vision or drug plans
- Disability income
- Medical claims paid by auto or homeowners insurance
When to Report a "Slow Payer"
Providers or covered individuals will need to give companies at least 30 days to respond to a claim. During that time, the insurance company does have the right to request additional information regarding a claim. They are required to notify you of this action within the 30 day time period. If you do not receive payment or a notice of delay within 30 days the law allows you to file a written complaint. If the insurance company requests additional information, they are allowed 15 days from the date they receive the required information to pay or deny the claim. In situations where additional information is requested, we suggest that you check with the insurance company to determine if and when the additional information was received. Complaints can then be filed if you think the 15 day response time has expired.
How to Report a "Slow Payer"
To report a slow claim payment, send a written notice to the Kansas Insurance Department. The complaint checklist on the reverse side of this brochure tells you what information to include. You will be notified as soon as our Consumer Assistance Division begins to investigate the claim. You will also be notified of the results of the investigation.
Submit complaint in writing. While no special form is required, it would help expedite the process to include the following information:
- Date claim sent to insurance company or date company acknowledged receipt
- How claim was submitted - electronically or by mail
- Copy of claim
- Brief description of your attempts to collect
- Copies of any written notices or other correspondence
- Submit claims for each patient together
- Identify the complaint as "Prompt Pay"
Kansas Insurance Department
Consumer Assistance Division
420 SW 9th St.
Topeka, KS 66612
If you have questions, contact the Consumer Assistance
Division of the Kansas Insurance Department.