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ARIZONA STATE SENATE
Fifty-Fourth Legislature, First Regular Session
AMENDED
health insurers; notice; providers
Purpose
Provides payment and notification requirements for health insurers and healthcare providers.
Background
To improve the efficiency and effectiveness of the healthcare system, the Health Insurance Portability and Accountability Act (HIPAA) of 1996 includes administrative simplification provisions that require the U.S. Department of Health and Human Services (U.S. HHS) to adopt national standards for electronic healthcare transactions and code sets, unique health identifiers and security (P.L. 104-191). The administrative simplification rules require HIPAA-covered health plans to have the ability to send or receive these standardized electronic healthcare transactions when requested by HIPAA-covered providers.
In its January 10, 2014, rule, Administrative Simplification: Adoption of Standards for Healthcare Electronic Funds Transfers (EFTs) and Remittance Advice, the U.S. HHS adopted EFTs via the Automated Clearinghouse (ACH) as part of its EFT standards (45 C.F.R. §§ 162.1601 and 162.1602). While health plans were required to transmit electronic funds transfers via the ACH Network when requested by a provider, the January 2014 rule also noted that, “[h]ealth plans are not required to send healthcare EFT through the ACH Network. They may decide, for instance, to transmit a healthcare EFT via Fedwire or via a payment card network…when health plans do, however, send healthcare EFT through the ACH Network, they must do so using the healthcare EFT standards adopted herein." In today’s marketplace, HIPAA-covered health plans send healthcare payments via the ACH Network, payment card networks and by paper check.
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
Contractual Payment Requirements
1. Prohibits a contract between a health insurer and a healthcare provider, that is issued, amended or renewed on or after January 1, 2020, from restricting the method of payment from the health insurer to the healthcare provider in which the only acceptable payment method is a credit card payment.
2. Requires the health insurer, if that insurer initiates or changes payments to a healthcare provider using EFT payments, to:
a) notify the healthcare provider if any fee is associated with a particular payment method;
b) advise the healthcare provider of the available methods of payment and provide clear instructions to the healthcare provider as to how to select an alternative payment method; and
c) remit with each payment an explanation of benefits.
3. Prohibits a health insurer that initiates or changes payment to a healthcare provider using the Healthcare EFTs and Remittance Advice from charging a fee solely to transmit the payment to the provider, unless the provider has consented to the fee.
4. Allows a healthcare provider to charge reasonable fees when transmitting the EFTs related to transaction management, data management, portal services and other value-added services above and beyond the bank transmittal.
Network Notification Requirements
5. Requires a health insurer that has the contract with the healthcare provider, if that insurer acquires a healthcare provider network that includes healthcare providers that are not contracted directly with the health insurer, to:
a) notify each healthcare provider that is not contracted with the acquiring health insurer and that is in the network of the acquisition of the network; and
b) allow each healthcare provider that is not contracted with the acquiring health insurer and that is in the network to opt out of the network or contract with the health insurer.
Miscellaneous
6. Defines terms.
7. Becomes effective on the general effective date.
Amendments Adopted by Committee
1. Allows the restriction of payment by EFT payments.
2. Specifies that a health insurer that initiates or changes payment to a provider using healthcare EFTs may not charge a fee solely to transmit the payment of a healthcare provider unless the provider has consented to such a fee.
3. Allows a healthcare provider to charge reasonable fees related to value-added services.
House Action Senate Action
HHS 2/14/19 DPA 8-0-0-1 FIN 3/13/19 DPA 9-0-1
3rd Read 2/26/19 60-0-0
Prepared by Senate Research
March 15, 2019
CS/kja