Bill Text: MN HF312 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Health insurers required to honor the patient's assignment of benefits.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Introduced - Dead) 2011-02-02 - Introduction and first reading, referred to Commerce and Regulatory Reform [HF312 Detail]
Download: Minnesota-2011-HF312-Introduced.html
1.2relating to insurance; requiring health insurers to honor the patient's assignment
1.3of benefits; amending Minnesota Statutes 2010, section 72A.201, subdivision 4.
1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.5 Section 1. Minnesota Statutes 2010, section 72A.201, subdivision 4, is amended to
1.6read:
1.7 Subd. 4. Standards for claim filing and handling. The following acts by an
1.8insurer, an adjuster, a self-insured, or a self-insurance administrator constitute unfair
1.9settlement practices:
1.10 (1) except for claims made under a health insurance policy, after receiving
1.11notification of claim from an insured or a claimant, failing to acknowledge receipt of the
1.12notification of the claim within ten business days, and failing to promptly provide all
1.13necessary claim forms and instructions to process the claim, unless the claim is settled
1.14within ten business days. The acknowledgment must include the telephone number of the
1.15company representative who can assist the insured or the claimant in providing information
1.16and assistance that is reasonable so that the insured or claimant can comply with the policy
1.17conditions and the insurer's reasonable requirements. If an acknowledgment is made by
1.18means other than writing, an appropriate notation of the acknowledgment must be made in
1.19the claim file of the insurer and dated. An appropriate notation must include at least the
1.20following information where the acknowledgment is by telephone or oral contact:
1.21 (i) the telephone number called, if any;
1.22 (ii) the name of the person making the telephone call or oral contact;
1.23 (iii) the name of the person who actually received the telephone call or oral contact;
1.24 (iv) the time of the telephone call or oral contact; and
2.1 (v) the date of the telephone call or oral contact;
2.2 (2) failing to reply, within ten business days of receipt, to all other communications
2.3about a claim from an insured or a claimant that reasonably indicate a response is
2.4requested or needed;
2.5 (3)(i) unless provided otherwise by clause (ii) or (iii), other law, or in the policy,
2.6failing to complete its investigation and inform the insured or claimant of acceptance or
2.7denial of a claim within 30 business days after receipt of notification of claim unless
2.8the investigation cannot be reasonably completed within that time. In the event that the
2.9investigation cannot reasonably be completed within that time, the insurer shall notify
2.10the insured or claimant within the time period of the reasons why the investigation is not
2.11complete and the expected date the investigation will be complete. For claims made under
2.12a health policy the notification of claim must be in writing;
2.13 (ii) for claims submitted under a health policy, the insurer must comply with all of
2.14the requirements of section62Q.75 ;
2.15 (iii) for claims submitted under a health policy that are accepted, the insurer must
2.16notify the insured or claimant no less than semiannually of the disposition of claims of the
2.17insured or claimant. Notwithstanding the requirements of section72A.20, subdivision
2.1837, this notification requirement is satisfied if the information related to the acceptance of
2.19the claim is made accessible to the insured or claimant on a secured Web site maintained
2.20by the insurer. For purposes of this clause, acceptance of a claim means that there is no
2.21additional financial liability for the insured or claimant, either because there is a flat
2.22co-payment amount specified in the health plan or because there is no co-payment,
2.23deductible, or coinsurance owed;
2.24 (4) where evidence of suspected fraud is present, the requirement to disclose their
2.25reasons for failure to complete the investigation within the time period set forth in clause
2.26(3) need not be specific. The insurer must make this evidence available to the Department
2.27of Commerce if requested;
2.28 (5) failing to notify an insured who has made a notification of claim of all available
2.29benefits or coverages which the insured may be eligible to receive under the terms of a
2.30policy and of the documentation which the insured must supply in order to ascertain
2.31eligibility;
2.32 (6) unless otherwise provided by law or in the policy, requiring an insured to give
2.33written notice of loss or proof of loss within a specified time, and thereafter seeking to
2.34relieve the insurer of its obligations if the time limit is not complied with, unless the
2.35failure to comply with the time limit prejudices the insurer's rights and then only if the
2.36insurer gave prior notice to the insured of the potential prejudice;
3.1 (7) advising an insured or a claimant not to obtain the services of an attorney or
3.2an adjuster, or representing that payment will be delayed if an attorney or an adjuster
3.3is retained by the insured or the claimant;
3.4 (8) failing to advise in writing an insured or claimant who has filed a notification of
3.5claim known to be unresolved, and who has not retained an attorney, of the expiration of
3.6a statute of limitations at least 60 days prior to that expiration. For the purposes of this
3.7clause, any claim on which the insurer has received no communication from the insured
3.8or claimant for a period of two years preceding the expiration of the applicable statute
3.9of limitations shall not be considered to be known to be unresolved and notice need not
3.10be sent pursuant to this clause;
3.11 (9) demanding information which would not affect the settlement of the claim;
3.12 (10) unless expressly permitted by law or the policy, refusing to settle a claim of an
3.13insured on the basis that the responsibility should be assumed by others;
3.14 (11) failing, within 60 business days after receipt of a properly executed proof of loss,
3.15to advise the insured of the acceptance or denial of the claim by the insurer. No insurer
3.16shall deny a claim on the grounds of a specific policy provision, condition, or exclusion
3.17unless reference to the provision, condition, or exclusion is included in the denial. The
3.18denial must be given to the insured in writing with a copy filed in the claim file;
3.19 (12) denying or reducing a claim on the basis of an application which was altered or
3.20falsified by the agent or insurer without the knowledge of the insured;
3.21 (13) failing to notify the insured of the existence of the additional living expense
3.22coverage when an insured under a homeowners policy sustains a loss by reason of a
3.23covered occurrence and the damage to the dwelling is such that it is not habitable;
3.24 (14) failing to inform an insured or a claimant that the insurer will pay for an
3.25estimate of repair if the insurer requested the estimate and the insured or claimant had
3.26previously submitted two estimates of repair.;
3.27(15) in connection with a claim under a health plan or other health insurance
3.28coverage, failing to honor a patient's assignment of benefits requiring the insurer to make
3.29the payment on the claim directly to the health care provider if:
3.30(i) the provider is in the network of providers covered under the patient's health plan
3.31or other health insurance coverage under which the claim was submitted; and
3.32(ii) the insurer received the assignment of benefits no later than two days before
3.33making payment on the claim.
3.34Clause (15) applies regardless of whether the assignment of benefits form signed by
3.35the patient made payment directly to the provider optional on the part of the insurer.
4.1EFFECTIVE DATE.This section is effective August 1, 2011, and applies to claims
4.2submitted on or after that date.
1.3of benefits; amending Minnesota Statutes 2010, section 72A.201, subdivision 4.
1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.5 Section 1. Minnesota Statutes 2010, section 72A.201, subdivision 4, is amended to
1.6read:
1.7 Subd. 4. Standards for claim filing and handling. The following acts by an
1.8insurer, an adjuster, a self-insured, or a self-insurance administrator constitute unfair
1.9settlement practices:
1.10 (1) except for claims made under a health insurance policy, after receiving
1.11notification of claim from an insured or a claimant, failing to acknowledge receipt of the
1.12notification of the claim within ten business days, and failing to promptly provide all
1.13necessary claim forms and instructions to process the claim, unless the claim is settled
1.14within ten business days. The acknowledgment must include the telephone number of the
1.15company representative who can assist the insured or the claimant in providing information
1.16and assistance that is reasonable so that the insured or claimant can comply with the policy
1.17conditions and the insurer's reasonable requirements. If an acknowledgment is made by
1.18means other than writing, an appropriate notation of the acknowledgment must be made in
1.19the claim file of the insurer and dated. An appropriate notation must include at least the
1.20following information where the acknowledgment is by telephone or oral contact:
1.21 (i) the telephone number called, if any;
1.22 (ii) the name of the person making the telephone call or oral contact;
1.23 (iii) the name of the person who actually received the telephone call or oral contact;
1.24 (iv) the time of the telephone call or oral contact; and
2.1 (v) the date of the telephone call or oral contact;
2.2 (2) failing to reply, within ten business days of receipt, to all other communications
2.3about a claim from an insured or a claimant that reasonably indicate a response is
2.4requested or needed;
2.5 (3)(i) unless provided otherwise by clause (ii) or (iii), other law, or in the policy,
2.6failing to complete its investigation and inform the insured or claimant of acceptance or
2.7denial of a claim within 30 business days after receipt of notification of claim unless
2.8the investigation cannot be reasonably completed within that time. In the event that the
2.9investigation cannot reasonably be completed within that time, the insurer shall notify
2.10the insured or claimant within the time period of the reasons why the investigation is not
2.11complete and the expected date the investigation will be complete. For claims made under
2.12a health policy the notification of claim must be in writing;
2.13 (ii) for claims submitted under a health policy, the insurer must comply with all of
2.14the requirements of section
2.15 (iii) for claims submitted under a health policy that are accepted, the insurer must
2.16notify the insured or claimant no less than semiannually of the disposition of claims of the
2.17insured or claimant. Notwithstanding the requirements of section
2.19the claim is made accessible to the insured or claimant on a secured Web site maintained
2.20by the insurer. For purposes of this clause, acceptance of a claim means that there is no
2.21additional financial liability for the insured or claimant, either because there is a flat
2.22co-payment amount specified in the health plan or because there is no co-payment,
2.23deductible, or coinsurance owed;
2.24 (4) where evidence of suspected fraud is present, the requirement to disclose their
2.25reasons for failure to complete the investigation within the time period set forth in clause
2.26(3) need not be specific. The insurer must make this evidence available to the Department
2.27of Commerce if requested;
2.28 (5) failing to notify an insured who has made a notification of claim of all available
2.29benefits or coverages which the insured may be eligible to receive under the terms of a
2.30policy and of the documentation which the insured must supply in order to ascertain
2.31eligibility;
2.32 (6) unless otherwise provided by law or in the policy, requiring an insured to give
2.33written notice of loss or proof of loss within a specified time, and thereafter seeking to
2.34relieve the insurer of its obligations if the time limit is not complied with, unless the
2.35failure to comply with the time limit prejudices the insurer's rights and then only if the
2.36insurer gave prior notice to the insured of the potential prejudice;
3.1 (7) advising an insured or a claimant not to obtain the services of an attorney or
3.2an adjuster, or representing that payment will be delayed if an attorney or an adjuster
3.3is retained by the insured or the claimant;
3.4 (8) failing to advise in writing an insured or claimant who has filed a notification of
3.5claim known to be unresolved, and who has not retained an attorney, of the expiration of
3.6a statute of limitations at least 60 days prior to that expiration. For the purposes of this
3.7clause, any claim on which the insurer has received no communication from the insured
3.8or claimant for a period of two years preceding the expiration of the applicable statute
3.9of limitations shall not be considered to be known to be unresolved and notice need not
3.10be sent pursuant to this clause;
3.11 (9) demanding information which would not affect the settlement of the claim;
3.12 (10) unless expressly permitted by law or the policy, refusing to settle a claim of an
3.13insured on the basis that the responsibility should be assumed by others;
3.14 (11) failing, within 60 business days after receipt of a properly executed proof of loss,
3.15to advise the insured of the acceptance or denial of the claim by the insurer. No insurer
3.16shall deny a claim on the grounds of a specific policy provision, condition, or exclusion
3.17unless reference to the provision, condition, or exclusion is included in the denial. The
3.18denial must be given to the insured in writing with a copy filed in the claim file;
3.19 (12) denying or reducing a claim on the basis of an application which was altered or
3.20falsified by the agent or insurer without the knowledge of the insured;
3.21 (13) failing to notify the insured of the existence of the additional living expense
3.22coverage when an insured under a homeowners policy sustains a loss by reason of a
3.23covered occurrence and the damage to the dwelling is such that it is not habitable;
3.24 (14) failing to inform an insured or a claimant that the insurer will pay for an
3.25estimate of repair if the insurer requested the estimate and the insured or claimant had
3.26previously submitted two estimates of repair
3.27(15) in connection with a claim under a health plan or other health insurance
3.28coverage, failing to honor a patient's assignment of benefits requiring the insurer to make
3.29the payment on the claim directly to the health care provider if:
3.30(i) the provider is in the network of providers covered under the patient's health plan
3.31or other health insurance coverage under which the claim was submitted; and
3.32(ii) the insurer received the assignment of benefits no later than two days before
3.33making payment on the claim.
3.34Clause (15) applies regardless of whether the assignment of benefits form signed by
3.35the patient made payment directly to the provider optional on the part of the insurer.
4.1EFFECTIVE DATE.This section is effective August 1, 2011, and applies to claims
4.2submitted on or after that date.
