An Act
ENROLLED SENATE
BILL NO. 550 By: Newhouse of the Senate
and
Pae, McEntire, Davis,
Provenzano and Phillips of
the House
An Act relating to health insurance; amending 36 O.S .
2011, Section 1219, which rela tes to processing
claims; requiring insurer to provide specific reaso n
for denial of clean claims and partial clean claims
to certain persons within thirty days; requiring
insurer to include instructions for appealing denial ;
authorizing certain persons to submit written appeal
after denial; requiring insurer to provide cer tain
response to appeal and contact information of
department of appeals; and providing an effective
date.
SUBJECT: Health insurance
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 36 O.S. 2011, Section 1219, is
amended to read as follows:
Section 1219. A. In the administration, servicing, or
processing of any accident and health insur ance policy, every
insurer shall reimbu rse all clean claims of an insured, an assig nee
of the insured, or a health care provider wit hin forty-five (45)
calendar days after receipt o f the claim by the insurer.
B. As used in this section:
ENR. S. B. NO. 550 Page 2
1. “Accident and health insurance policy” or “policy” means any
policy, certificate, contract, agreement or other instrument that
provides accident and health insurance, as defined in Section 703 of
this title, to any person in this state, and any subscriber
certificate or any evidence of coverage issued by a h ealth
maintenance organization to any person in this state;
2. “Clean claim” means a claim that has no defect or
impropriety, including a lack of any required substantiating
documentation, or particular circumstance requiring special
treatment that impede s prompt payment; and
3. “Insurer” means any entity that provides an accident and
health insurance policy in this state, including, but not limited
to, a licensed insurance company, a not -for-profit hospital service
and medical indemnity corporation, a he alth maintenance
organization, a fraternal benefit society, a multiple employer
welfare arrangement, or any other entity subject to regulation by
the Insurance Commissioner.
C. If a claim or any portion of a claim is determined to have
defects or improprieties, including a lack of any required
substantiating documentation, or particular circumsta nce requiring
special treatment, the insured, enrollee or subscriber, assignee of
the insured, enrollee or subsc riber, and health care provider shall
be notified in writing within thirty (30) calendar days after
receipt of the claim by the insurer. The wr itten notice shall
specify the portion of the claim that is causing a delay in
processing and explain any additional informa tion or corrections
needed. Failure of an insurer to provide the insured, enrollee or
subscriber, assignee of the insured, enrollee or subscriber, and
health care provider with the notice shall constitute prima facie
evidence that the claim will be paid in accordance with the terms of
the policy. Provided, if a claim is not submitted into the system
due to a failure to meet basic Ele ctronic Data Interchange (EDI)
and/or Health Insurance Portability and Accountability Act (HIPAA)
edits, electronic notification of the failure to the submitter sh all
be deemed compliance with this subsection. Provided further, health
maintenance organiza tions shall not be required to notify the
insured, enrollee or subscriber, or assignee of the insured,
enrollee or subscriber of any claim defect or impropriety.
ENR. S. B. NO. 550 Page 3
D. Upon receipt of the additional information or corrections
which led to the claim’s being delayed and a determination that the
information is accurate, an insurer shall either pay or deny the
claim or a portion of the claim within forty-five (45) calendar
days.
D. If a clean claim or any portion of a clean claim is denied
for any reason, the insured, enrollee or subscriber, assignee of the
insured, enrollee or subsc riber, and health care provider shall be
notified in writing within thirty (30) calendar d ays after receipt
of the claim by the insurer. The written notice shall specify in
detail the reason for the denial including instructions on where a
person or entity that received notification may respond through
dedicated facsimile or electronic mail me ssage or the address or
electronic mail message address of the department of appeals of the
insurer. Upon receiving written notice of denial, a recipient may
submit a detailed app eal in writing explaining why the claim should
be approved. If the insurer denies the appeal, the insurer shall
address in writing the specific details included in the written
appeal and provide the phone number of a health plan representative
at the department of appeals of the insurer .
E. Payment shall be considered made on:
1. The date a draft or other valid instrument which is
equivalent to the amount of the paymen t is placed in the United
States mail in a properly addressed, postpaid envelope ; or
2. If not so posted, the date of deliv ery.
F. An overdue payment shall bear simple interest at t he rate of
ten percent (10%) per year.
G. In the event litigation should ensue based upon such a
claim, the prevailing party shall be entitled to recove r a
reasonable attorney fee to be set by the court and taxed as costs
against the party or parties who do not prevail.
H. The Insurance Commissioner shall develop a standardiz ed
prompt pay form for use by providers in reporting violations of
prompt pay requirements. The form shall include a requir ement that
ENR. S. B. NO. 550 Page 4
documentation of the reason for the delay in pay ment or
documentation of proof of payment must be provided within ten (10 )
days of the filing of the form. The Commissioner shall provide the
form to health maintenance organizations and providers .
I. The provisions of this section sh all not apply to the
Oklahoma Life and Health Insurance Guaranty Association or to the
Oklahoma Property and Casualty Insurance Guaranty Associat ion.
SECTION 2. This act shall become effective Novembe r 1, 2021.
ENR. S. B. NO. 550 Page 5
Passed the Senate the 10th day of March, 2021.
Presiding Officer of the Senate
Passed the House of Representatives the 19th day of April, 2021.
Presiding Officer of the House
of Representatives
OFFICE OF THE GOVERNOR
Received by the Office of the Governor this _______ _____________
day of ___________________, 20_______, at _______ o'clock _______ M.
By: _______________________________ __
Approved by the Governor of the State of Oklahoma this _____ ____
day of _________________ __, 20_______, at _______ o'clock _______ M.
_____________________________ ____
Governor of the State of Oklahoma
OFFICE OF THE SECRETARY OF STATE
Received by the Office of the Secretary of State this _______ ___
day of __________________, 20 _______, at _______ o'clock _______ M.
By: _______________________________ __