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SENATE FLOOR VERSION
February 18, 2021
AS AMENDED
SENATE BILL NO. 92 By: McCortney, Rader,
Montgomery, Jett and
Stanley of the Senate
and
McEntire of the House
[ insurance - Unfair Claims Settlement Practices Act
- effective date ]
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 36 O.S. 2011, Section 1250.5, as
amended by Section 1, Chapter 105, O.S.L. 2012 (36 O.S. Supp. 2020,
Section 1250.5), is am ended to read as follows:
Section 1250.5. Any of the following acts by an insurer, if
committed in violation of Section 1250.3 of this title, constitutes
an unfair claim settle ment practice exclusive of paragraph 16 of
this section which shall be applicable solely to he alth benefit
plans:
1. Failing to fully disclose to first party claimants,
benefits, coverages, or other provisions of any insurance policy or
insurance contract when the benefits, coverages or other pro visions
are pertinent to a claim;
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2. Knowingly misrepresenting to claimants pertinent facts or
policy provisions relating to coverages at issue;
3. Failing to adopt and implement reasonable s tandards for
prompt investigations of claims arising under its insurance policies
or insurance contracts;
4. Not attempting in good faith to effectuate prompt, fair and
equitable settlement of claims submitted in which liability has
become reasonably clea r;
5. Failing to comply with the provisions of Section 1219 of
this title;
6. Denying a claim for failure to exhi bit the property without
proof of demand and unfounded refusal by a claimant to do so;
7. Except where there is a time limit specified in th e policy,
making statements, written or otherwise, which requir e a claimant to
give written notice of loss or proof of loss within a specified time
limit and which seek to relieve the company of its obligations if
the time limit is not complied with unless the failure to compl y
with the time limit prejudices the right s of an insurer;
8. Requesting a claimant to sign a release that extends beyond
the subject matter that gave rise to the claim payment;
9. Issuing checks or drafts in partial settlement of a loss or
claim under a specified coverage which contain language releasing an
insurer or its insured from its total liability;
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10. Denying payment to a claimant on the grounds that services,
procedures, or supplies provided by a treating physician or a
hospital were not medica lly necessary unless the health insurer or
administrator, as defined in Section 1442 of this t itle, first
obtains an opinion from any provider of health care licensed by law
and preceded by a medical examination or claim review, to the effect
that the services, procedures or supplies for which pay ment is being
denied were not medically necessary. Upon written request of a
claimant, treating physician, or hospital, the opinion shall be set
forth in a written report, prepared and signed by the reviewing
physician. The report shall detail which spec ific services,
procedures, or supplies were not medi cally necessary, in the opinion
of the reviewing physician, and an explanation of that conclusion.
A copy of each report of a reviewing phys ician shall be mailed by
the health insurer, or administrator, postage prepaid, to the
claimant, treating physician or hospital requesting same within
fifteen (15) days after receipt of the written request. As used in
this paragraph, "physician" means a person holding a valid license
to practice medicine and surgery, osteopathic medicine, podiatric
medicine, dentistry, chiropractic, or optometry, pursuant to the
state licensing provisions of Title 59 of the Oklahoma Statutes;
11. Compensating a reviewing physician, as defined in paragraph
10 of this subsection section, on the basis of a percentage of the
amount by which a claim is reduced for payment;
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12. Violating the provisions of the Health Care Fraud
Prevention Act;
13. Compelling, without just cause , policyholders to in stitute
suits to recover amounts due under its ins urance policies or
insurance contracts by of fering substantially less than the amounts
ultimately recovered in suits brought by them, when the
policyholders have made claims for amounts reasonably similar t o the
amounts ultimately recovered;
14. Failing to maintain a complete record of all complain ts
which it has received during the preceding three (3) years or since
the date of its last financial examination conducted or accepted by
the Commissioner, which ever time is longer. This record shall
indicate the total number of complaints, their classif ication by
line of insurance, the nature of each complaint, the disposition of
each complaint, and the time it took to process each complaint . For
the purposes of this paragraph, "complaint" means any written
communication primarily expressing a grievance ;
15. Requesting a refund of all or a portion of a payment of a
claim made to a claimant or health care provider more than twenty -
four (24) months after the paym ent is made. This paragraph shall
not apply:
a. if the payment was made because of fraud comm itted by
the claimant or health care provider, or
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b. if the claimant or health care provider has otherwise
agreed to make a refund to the ins urer for overpayment
of a claim;
16. Failing to pay, or requesting a r efund of a payment, for
health care services covered under the policy if a health benefit
plan, or its agent, has provided a preauthorization or
precertification and verification of eli gibility for those he alth
care services. This paragraph shall not appl y if:
a. the claim or payment was made becau se of fraud
committed by the claimant or health care provider,
b. the subscriber had a preexisting exclusion under the
policy related to the service provided, or
c. the subscriber or employer failed to pay the
applicable premium and all grace periods and
extensions of coverage have expired; or
17. Denying or refusing to accept an application for life
insurance, or refusing to renew, cancel, re strict or otherwise
terminate a policy of life insurance, or charge a d ifferent rate
based upon the lawful travel d estination of an applicant or insured
as provided in Section 4024 of this title ; or
18. As a health insurer that provides pharmacy benefits or a
pharmacy benefits manager that administers pharma cy benefits for a
health plan, failing to include any amount paid by an enrollee or on
behalf of an enrollee by another person , as defined in Section 104
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of this title, when calculating the total contribution to an out-of-
pocket maximum of the enrollee, deductible, copayment, coinsurance
or other cost-sharing requirement.
SECTION 2. This act shall become effective November 1, 2021.
COMMITTEE REPORT BY: COMMITTEE ON RETIREMENT AND INSURANCE
February 18, 2021 - DO PASS AS AMENDED