BULLETIN 2000-6
TO:
All companies authorized to transact Accident and Health Insurance in the
State of Kansas
FROM:
Kathleen Sebelius
Commissioner of Insurance
SUBJECT:
Kansas Health Care Prompt Payment Act; Definition of Violation
DATE:
December 21, 2000
The 2000 Kansas Legislature passed the Kansas Health Care Prompt Payment Act (the
Act), L. 2000, ch. 147, §§ 43 45, to establish a framework for payment of health
insurance claims. Although the Act contemplates that the private parties involved in
these transactions will perform the majority of the correspondence, collection, and
enforcement governed by the Act, section 45(f) of the Act allows this department to
penalize insurers under the Unfair Trade Practices Act, K.S.A. 40-2401 et seq., for
committing any violation of the Act. I have issued this bulletin to establish what I will
consider a violation of the Act for purposes of my enforcement under section 45(f) of
the Act and K.S.A. 40-2401 et seq.
An insurer commits a violation of the Act for purposes of section 45(f) of the act if it
engages in, either with flagrant and conscious disregard of the provisions of the act or
with such frequency as to constitute a general business practice, any of the following
behaviors:
1. Within 30 days of receipt of any claim, regardless of whether a good faith dispute
about the legitimacy of the claim exists, failing to either
a. pay a clean claim; or
b. send written or electronic notice that acknowledges receipt of such claim
and states that the insurer refuses to
i. reimburse all or part of the claim and
ii. specifies each reason for denial or that additional information is
necessary to determine if all or any part of the claim will be
reimbursed and what specific additional information is necessary.