Bill Text: NJ S1920 | 2010-2011 | Regular Session | Introduced
Bill Title: Requires administrative law judges to hear disputes over the recovery of certain medical expense or other personal injury protection benefits.
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2010-05-13 - Introduced in the Senate, Referred to Senate Commerce Committee [S1920 Detail]
Download: New_Jersey-2010-S1920-Introduced.html
Sponsored by:
Senator GERALD CARDINALE
District 39 (Bergen)
Senator NICHOLAS P. SCUTARI
District 22 (Middlesex, Somerset and Union)
SYNOPSIS
Requires administrative law judges to hear disputes over the recovery of certain medical expense or other personal injury protection benefits.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning disputes over the recovery of certain medical expense or other personal injury protection benefits, and supplementing and amending various parts of the statutory law.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section) An administrative law judge shall have the authority to hear cases presented to the Commissioner of Banking and Insurance involving any dispute over the payment or recovery of medical expense or other personal injury protection benefits as set forth under section 5 of P.L.1972, c.70 (C.39:6A-5), or sections 24 and 25 of P.L.1998, c.21 (C.39:6A-5.1 and C.39:6A-5.2). The provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) shall apply to the hearings presented before an administrative law judge. The decision of an administrative law judge shall be considered the final agency action on the matter, not subject to further administrative review, for the purposes of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), and shall be subject only to judicial review as provided in the Rules of Court.
2. Section 5 of P.L.1972, c.70 (C.39:6A-5) is amended to read as follows:
5. Payment of personal injury protection coverage benefits.
a. An insurer may require written notice to be given as soon as practicable after an accident involving an automobile with respect to which the policy affords personal injury protection coverage benefits payable under a standard automobile insurance policy pursuant to section 4 of P.L.1972, c.70 [(C.34:6A-4)] (C.39:6A-4), medical expense benefits payable under a basic automobile insurance policy pursuant to section 4 of P.L.1998, c.21 (C.39:6A-3.1) or emergency care medical expense benefits payable under a special automobile insurance policy pursuant to section 45 of P.L.2003, c.89 (C.39:6A-3.3). In the case of claims for medical expense benefits under any of those policies, written notice shall be provided to the insurer by the treating health care provider no later than 21 days following the commencement of treatment. Notification required under this section shall be made in accordance with regulations adopted by the Commissioner of Banking and Insurance and on a form prescribed by the Commissioner of Banking and Insurance. Within a reasonable time after receiving notification required pursuant to this act, the insurer shall confirm to the treating health care provider that its policy affords the claimant personal injury protection coverage benefits as required by section 4 of P.L.1972, c.70 (C.39:6A-4), medical expense benefits pursuant to section 4 of P.L.1998, c.21 (C.39:6A-3.1) or emergency care medical expense benefits payable under a special automobile insurance policy pursuant to section 45 of P.L.2003, c.89 (C.39:6A-3.3).
b. For the purposes of this section, notification shall be deemed to be met if a treating health care provider submits a bill or invoice to the insurer for reimbursement of services within 21 days of the commencement of treatment.
c. In the event that notification is not made by the treating health care provider within 21 days following the commencement of treatment, the insurer shall reserve the right to deny, in accordance with regulations established by the Commissioner of Banking and Insurance, payment of the claim and the treating health care provider shall be prohibited from seeking any payment directly from the insured. In establishing the standards for denial of payment, the Commissioner of Banking and Insurance shall consider the length of delay in notification, the severity of the treating health care provider's failure to comply with the notification provisions of this act based upon the potential adverse impact to the public and whether or not the provider has engaged in a pattern of noncompliance with the notification provisions of this act. In establishing the regulations necessary to effectuate the purposes of this subsection, the Commissioner of Banking and Insurance shall define specific instances where the sanctions permitted pursuant to this subsection shall not apply. Such instances may include, but not be limited to, a treating medical provider's failure to provide notification to the insurer as required by this act due to the insured's medical condition during the time period within which notification is required.
d. A health care provider who fails to notify the insurer within 21 days and whose claim for payment has been denied by the insurer pursuant to the standards established by the Commissioner of Banking and Insurance may be permitted, in the discretion of [a] an administrative law judge [of the Superior Court], [be permitted] acting on behalf of the commissioner and applying the standards established by the commissioner, to refile such claim provided that the insurer has not been substantially prejudiced thereby. Application to the [court] commissioner, for a hearing before an administrative law judge for permission to refile a claim shall be made within 14 days of notification of denial of payment and shall be [made upon motion based upon] presented with affidavits showing sufficient reasons for the failure to notify the insurer within the period of time prescribed by this act.
e. (Deleted by amendment, P.L.1998, c.21.)
f. In instances when multiple treating health care providers render services in connection with emergency care, the Commissioner of Banking and Insurance shall designate, through regulation, a process whereby notification by one treating health care provider to the insurer shall be deemed to meet the notification requirements of all the treating health care providers who render services in connection with emergency care.
g. Personal injury protection coverage benefits pursuant to section 4 of P.L.1972, c.70 (C.39:6A-4) and medical expense benefits pursuant to section 4 of P.L.1998, c.21 (C.39:6A-3.1) or emergency care medical expense benefits payable under a special automobile insurance policy pursuant to section 45 of P.L.2003, c.89 (C.39:6A-3.3) shall be overdue if not paid within 60 days after the insurer is furnished written notice of the fact of a covered loss and of the amount of same. If such written notice is not furnished to the insurer as to the entire claim, any partial amount supported by written notice is overdue if not paid within 60 days after such written notice is furnished to the insurer. Any part or all of the remainder of the claim that is subsequently supported by written notice is overdue if not paid within 60 days after such written notice is furnished to the insurer; provided, however, that any payment shall not be deemed overdue where, within 60 days of receipt of notice of the claim, the insurer notifies the claimant or his representative in writing of the denial of the claim or the need for additional time, not to exceed 45 days, to investigate the claim, and states the reasons therefor. The written notice stating the need for additional time to investigate the claim shall set forth the number of the insurance policy against which the claim is made, the claim number, the address of the office handling the claim and a telephone number, which is toll free or can be called collect, or is within the claimant's area code. Written notice to the [organization administering dispute resolution] administrative law judge regarding a dispute over the recovery of benefits pursuant to sections 24 and 25 of P.L.1998, c.21 (C.39:6A-5.1 and C.39:6A-5.2) shall satisfy the notice request for additional time to investigate a claim pursuant to this subsection. For the purpose of determining interest charges in the event the injured party prevails in a subsequent proceeding where an insurer has elected a 45-day extension pursuant to this subsection, payment shall be considered overdue at the expiration of the 45-day period or, if the injured person was required to provide additional information to the insurer, within 10 business days following receipt by the insurer of all the information requested by it, whichever is later.
For the purpose of calculating the extent to which any benefits are overdue, payment shall be treated as being made on the date a draft or other valid instrument which is equivalent to payment was placed in the United States mail in a properly addressed, postpaid envelope, or, if not so posted, on the date of delivery.
h. All overdue payments shall bear interest at the percentage of interest prescribed in the Rules Governing the Courts of the State of New Jersey for judgments, awards and orders for the payment of money.
i. All automobile insurers and the Unsatisfied Claim and Judgment Fund shall [provide] notify any claimant [with] of the [option of] requirement for submitting a dispute under this section to [dispute resolution] the commissioner for a hearing before an administrative law judge pursuant to sections 24 and 25 of P.L.1998, c.21 (C.39:6A-5.1 and C.39:6A-5.2).
(cf: P.L.2003, c.89, s.48)
3. Section 24 of P.L.1998, c.21 (C.39:6A-5.1) is amended to read as follows:
24. a. Any dispute regarding the recovery of medical expense benefits or other benefits provided under personal injury protection coverage pursuant to section 4 of P.L.1972, c.70 (C.39:6A-4), section 4 of P.L.1998, c.21 (C.39:6A-3.1) or section 45 of P.L.2003, c.89 (C.39:6A-3.3) arising out of the operation, ownership, maintenance or use of an automobile [may] shall be submitted to [dispute resolution] the commissioner for a hearing before an administrative law judge on the initiative of any party to the dispute, as hereinafter provided. The provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) shall apply to the hearing presented before the administrative law judge. The decision of an administrative law judge shall be considered the final agency action on the matter, not subject to further administrative review, for the purposes of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), and shall be subject only to judicial review as provided in the Rules of Court.
b. [The Commissioner of Banking and Insurance shall designate an organization, and for that purpose may, at his discretion, advertise for proposals, for the purpose of administering dispute resolution proceedings regarding medical expense benefits and other benefits provided under personal injury protection pursuant to section 4 of P.L.1972, c.70 (C.39:6A-4), medical expense benefits coverage pursuant to section 4 of P.L.1998, c.21 (C.39:6A-3.1) or emergency care medical expense benefits pursuant to section 45 of P.L.2003, c.89 (C.39:6A-3.3). The commissioner shall promulgate rules and regulations with respect to the conduct of the dispute resolution proceedings. The organization administering dispute resolution shall utilize qualified professionals who serve on a full-time basis and who meet standards of competency established by the commissioner. The commissioner shall establish standards of performance for the organization to ensure the independence and fairness of the review process, including, but not limited to, standards relative to the professional qualifications of the professionals presiding over the dispute resolution process, and standards to ensure that no conflict of interest exists which would prevent the professional from performing his duties in an impartial manner. The standards of performance shall include a requirement that the organization establish an advisory council composed of parties who are users of the dispute resolution mechanism established herein. The commissioner may contract with a consulting firm for the formulation of the standards of performance of the organization and establishment of qualifications for the persons who are to conduct the dispute resolution proceedings. The commissioner shall not advertise for bids for the consulting firm, as provided in sections 3 and 4 of P.L.1954, c.48 (C.52:34-8 and 52:34-9). Compensation to the dispute resolution professionals shall be established by the commissioner and adjusted from time to time as appropriate, with the approval of the commissioner. In no case shall compensation be paid on a contingency basis. The organization shall establish a dispute resolution plan, which shall include procedures and rules governing the dispute resolution process and provisions for monitoring the dispute resolution process to ensure adherence to the standards of performance established by the commissioner. The plan, and any amendments thereto, shall be subject to the approval of the commissioner.] (Deleted by amendment, P.L. , c. ) (pending before the Legislature as this bill)
c. [Dispute resolution proceedings] Hearings before an administrative law judge under this section 24 and section 25 of this amendatory and supplementary act shall include disputes arising regarding medical expense benefits provided under subsection a. of section 4 of P.L.1972, c.70 (C.39:6A-4), section 4 of P.L.1998, c.21 (C.39:6A-3.1) or section 45 of P.L.2003, c.89 (C.39:6A-3.3), benefits provided pursuant to subsection b., c., d. or e. of section 4 of P.L.1972, c.70 (C.39:6A-4), subsection b., c., d. or e. of section 7 of P.L.1972, c.198 (C.39:6-86.1), and disputes as to additional first party coverage benefits required to be offered pursuant to section 10 of P.L.1972, c.70 (C.39:6A-10). Disputes involving medical expense benefits may include, but not necessarily be limited to, matters concerning: (1) interpretation of the insurance contract; (2) whether the treatment or health care service which is the subject of the [dispute resolution proceeding] hearing is in accordance with the provisions of section 4 of P.L.1972, c.70 (C.39:6A-4), section 4 of P.L.1998, c.21 (C.39:6A-3.1) or section 45 of P.L.2003, c.89 (C.39:6A-3.3) or the terms of the policy; (3) the eligibility of the treatment or service for compensation; (4) the eligibility of the provider performing the treatment or service to be compensated under the terms of the policy or under regulations promulgated by the commissioner, including whether the person is licensed or certified to perform such treatment; (5) whether the disputed medical treatment was actually performed; (6) whether diagnostic tests performed in connection with the treatment are those recognized by the commissioner; (7) the necessity or appropriateness of consultations by other health care providers; (8) disputes involving application of and adherence to fee schedules promulgated by the commissioner; and (9) whether the treatment performed is reasonable, necessary, and compatible with the protocols provided for pursuant to P.L.1998, c.21 (C.39:6A-1.1 et al.). [The dispute resolution professionals may review the entire claims file of the insurer, subject to any confidentiality requirement established pursuant to State or federal law. All decisions of the dispute resolution professional shall be in writing, in a form prescribed by the commissioner, shall state the issues in dispute, the findings and conclusions on which the decision is based, and shall be signed by the dispute resolution professional. All decisions of a dispute resolution professional shall be binding. The dispute resolution organization shall provide for the retention of all documents used in dispute resolution proceedings under this section and section 25 of this amendatory and supplementary act, including the written decision, for a period of at least five years, in a form approved by the commissioner, or for such additional time as may be established by the commissioner. The written decisions of the dispute resolution professional shall be forwarded to the commissioner, who shall establish a record of the proceedings conducted under the dispute resolution procedure, which shall be accessible to the public and may be used as guidance in subsequent dispute resolution proceedings.]
d. With respect to disputes as to the diagnosis, the medical necessity of the treatment or diagnostic test administered to the injured person, whether the injury is causally related to the insured event or is the product of a preexisting condition, or disputes as to the appropriateness of the protocols utilized by the provider, the [dispute resolution professional] administrative law judge shall, either at his option or at the request of any party to the dispute, refer the matter to a medical review organization for a determination pursuant to section 25 of P.L.1998, c.21 (C.39:6A-5.2). The determination of the medical review organization on the dispute referred shall be presumed to be correct by the [dispute resolution professional] administrative law judge, which presumption may be rebutted by a preponderance of the evidence. Should the [dispute resolution professional] administrative law judge find that the decision of the medical review organization is not correct, the reasons supporting that finding shall be set forth in the [dispute resolution professional's] administrative law judge's written decision.
e. Any person submitting a matter to [the dispute resolution process] a hearing before an administrative law judge as established herein may submit for review all or a portion of a disputed treatment or treatments or a dispute regarding a diagnostic test or tests or a dispute regarding the providing of services or durable medical goods. Any portion of a treatment or diagnostic test or service which is not under review shall be reimbursed in accordance with the provisions of section 5 of P.L.1972, c.70 (C.39:6A-5). If the [dispute resolution proceeding] hearing results in a determination that all or part of a treatment or treatments, diagnostic test or tests or service performed, or durable medical goods provided are medically necessary and appropriate, reimbursement shall be made with interest payable in accordance with the provisions of section 5 of P.L.1972, c.70 (C.39:6A-5).
(cf: P.L.2003, c.89, s.49)
4. Section 25 of P.L.1998, c.21 (C.39:6A-5.2) is amended to read as follows:
25. a. The commissioner shall establish standards for the certification of medical review organizations, which shall include standards of performance formulated by the commissioner in consultation with the Commissioner of Health and Senior Services. The standards of performance shall set forth procedures to ensure a timely and impartial review of the medical records of the injured person by a medical review organization, including, but not limited to, a review of the necessity or appropriateness of treatments for injuries, including diagnostic tests, sustained in an automobile accident. The commissioner shall establish standards for persons conducting the medical review, including standards with respect to credentials, experience, licensure, fees, and confidentiality. The standards shall include a requirement that all persons performing reviews are New Jersey licensed or certified health care providers, and a requirement that any medical review panel contain a health care provider licensed or certified in the same profession as the treating health care provider and that it contain a sufficient representation of reviewers to judge the appropriateness of treatment or treatments in dispute, including, but not limited to, the medical necessity of such treatments, appropriateness of the protocols used by the treating provider, issues regarding causality and preexisting conditions, the appropriateness and efficacy of diagnostic tests performed in connection with the diagnosis, and whether the diagnostic tests meet the requirements established by the commissioner. The commissioner may contract with a consultant for the formulation of the standards governing the certification of the persons conducting the medical reviews. The commissioner shall not advertise for bids for the consultant, as provided in sections 3 and 4 of P.L.1954, c.48 (C.52:34-8 and 52:34-9).
b. Before certifying a medical review organization to receive referrals from [dispute resolution proceedings] a hearing before an administrative law judge, the commissioner shall determine that the organization has a sufficient number of qualified health care providers, by specialty, to perform the reviews, has a satisfactory procedure for maintaining the confidentiality of medical records, is not owned or controlled by an insurer, and has met any other requirements established by the commissioner.
c. The medical review organization shall establish and utilize written review procedures, which shall be filed with the commissioner. Every determination made by a medical review organization shall be in writing and shall be retained by the organization for a period of no less than five years.
d. The medical review organization may review the medical treatment or treatments in dispute to determine whether: (1) the treatment or diagnostic test being given for the injury or the services provided in connection with the injury is medically necessary; (2) the treatment is in accordance with or compatible with medically recognized standard protocols, professional standards, and commonly accepted medical practice in the same health care discipline as the treating provider; (3) the treatment is consistent with the symptoms or diagnosis of the injury; (4) the treatment or health care service is related to the injury sustained in the insured event, or is required for the diagnosis, evaluation or confirmation of the injury; (5) the treatment is of a palliative, rather than restorative, nature; and (6) medical procedures, treatment, or testing which have been repeated are medically necessary and consistent with standard practice.
e. Cases referred by [a dispute resolution professional] an administrative law judge for medical review shall be referred to appropriate certified medical reviewers affiliated with the certified medical review organization [by a dispute resolution organization]. The [dispute resolution] certified medical review organization shall forward the referrals to certified medical reviewers on a random basis, so that there is a relatively equal apportionment among all medical reviewers. Referrals shall be made in such a manner so as not to disclose to the medical reviewers the identity of the insurer, nor shall the identity of the reviewer be disclosed to the insurer.
f. When appropriate in the context of its review of services or treatments under dispute, a medical reviewer may request and shall receive a written report or copy of the provider's records regarding the case history, treatment dates, or the dates diagnostic tests or other services were performed, and the provider's projected treatment plan. The injured person or provider, as applicable, shall provide or make available to the medical reviewer any pertinent medical records or medical history which the medical reviewer may request. The medical reviewer shall complete its review and make a determination within 20 business days of receipt of all of the requested information from the [dispute resolution professional] administrative law judge or provider, as the case may be. The medical reviewer shall submit its determination in writing to the referring dispute resolution organization, which shall forward it to the [dispute resolution professional] administrative law judge.
g. The cost of the proceedings shall be apportioned by the [dispute resolution professional] administrative law judge. Fees shall be determined to be reasonable if they are consonant with the amount of the award, in accordance with a schedule established by the New Jersey Supreme Court. If the treatment, diagnostic test, or service performed is not determined to be medically necessary or appropriate, the injured person shall not be liable to pay the provider the disputed amount.
(cf: P.L.1998, c.21, s.25)
5. Section 2 of P.L.1983, c.358 (C.39:6A-25) is amended to read as follows:
2. a. Any cause of action filed in the Superior Court after the operative date of this act, for the recovery of noneconomic loss, as defined in section 2 of P.L.1972, c.70 (C.39:6A-2), or the recovery of uncompensated economic loss, other than for damages to property, or, on or after the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), other than as presented to the commissioner for a hearing before an administrative law judge, arising out of the operation, ownership, maintenance or use of an automobile, as defined in that section 2, shall be submitted, except as hereinafter provided, to arbitration by the assignment judge of the court in which the action is filed, if the court determines that the amount in controversy is $15,000.00 or less, exclusive of interest and costs; provided that if the action is for recovery for both noneconomic and economic loss, the controversy shall be submitted to arbitration if the court determines that the amount in controversy for noneconomic loss is $15,000.00 or less, exclusive of interest and costs.
b. Notwithstanding that the amount in controversy of an action for noneconomic loss is in excess of $15,000.00, the court may refer the matter to arbitration, if all of the parties to the action consent in writing to arbitration and the court determines that the controversy does not involve novel legal or unduly complex factual issues.
No cause of action determined by the court to be, upon proper motion of any party to the controversy, frivolous, insubstantial or without actionable cause shall be submitted to arbitration.
The provisions of this section shall not apply to any controversy on which an arbitration decision was rendered prior to the filing of the action.
The provisions of this section shall apply to any cause of action, subject to this section, filed prior to the operative date of this act, if a pretrial conference has not been concluded thereon.
(cf: P.L.1983, c.358, s.2)
6. This act shall take effect on the first day of the tenth month next following enactment, and shall apply to any dispute over the payment or recovery of medical expense or other personal injury protection benefits for which the cause of action accrues on or after the effective date.
STATEMENT
This bill requires administrative law judges to hear disputes over the recovery of medical expense or other personal injury protection benefits, based upon an individual's private passenger automobile insurance coverage or claim under the Unsatisfied Claim and Judgment Fund.
Specifically, the bill provides that an administrative law judge shall have the authority to hear cases presented to the Commissioner of Banking and Insurance involving any dispute over the payment or recovery of medical expense or other personal injury protection benefits as set forth under section 5 of P.L.1972, c.70 (C.39:6A-5), or sections 24 and 25 of P.L.1998, c.21 (C.39:6A-5.1 and C.39:6A-5.2). The provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) shall apply to any hearings presented before the administrative law judge. The decision of the administrative law judge shall be considered the final agency action on the matter, not subject to further administrative review, for the purposes of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), and shall be subject only to judicial review as provided in the Rules of Court.
The hearings before an administrative law judge are intended to replace the current alternative dispute resolution process presented under existing law and overseen by the Commissioner of Banking and Insurance, whereby disputes are considered by State contracted dispute resolution organizations.
