Health Insurance - Prompt Payment of Claims - Requirements
HB0739 revises Maryland’s prompt-payment rules for health insurance claims. It requires insurers, nonprofit health service plans, and health maintenance organizations to send certain claim-status notices by mail or email within 30 days after receiving a claim, and it clarifies that a refusal to reimburse all or part of a claim is treated as a denial of that claim. The bill also requires carriers to identify whether a claim is disputed, not clean, or missing specific information, and it sets deadlines for paying undisputed portions of claims while additional information is requested.
The bill also addresses provider payment methods and claim-processing timelines. It allows payment by credit card or electronic funds transfer only if the provider is notified in advance, offered a no-fee alternative, and affirmatively elects that method; for participating providers, that election generally applies to all claims unless changed. It preserves and reinforces existing provider rights to submit claims within at least 180 days, appeal denials within at least 90 working days, and have certain processing errors corrected without resubmission. It also requires interest on late-paid clean claims and retains penalties for violations, including fines for arbitrary and capricious violations and additional penalties for patterns of noncompliance.
HB0739 amends § 15-1005 of the Insurance Article, expanding and clarifying the prompt-payment obligations of insurers, nonprofit health service plans, and HMOs. It changes notice requirements, deems certain refusals to reimburse to be denials, adds deadlines for responding when additional information is needed, and requires payment of undisputed portions of claims while disputes are resolved. The bill also affects provider reimbursement practices by regulating fee-bearing electronic payment methods and by reinforcing claim submission, appeal, and reprocessing rights. Its application is limited to the extent consistent with ERISA and includes a delayed effective date of October 1, 2026.
Based on the bill text and the absence of recorded votes or committee testimony in the provided materials, the overall sentiment appears procedural and consumer/provider-protective rather than controversial. The measure is framed as a technical but substantive strengthening of prompt-payment protections for health care providers, with an emphasis on clearer notices, faster partial payments, and accountability for late claims. No formal opposition or support is documented in the supplied context.
The main points of potential contention are operational and financial: insurers may view the bill as increasing administrative burdens, shortening effective response windows, and exposing them to more interest and penalty liability for delayed or disputed claims. Providers are likely to support the clearer denial standards, mandatory partial payment of undisputed amounts, and protections against fee-charging payment methods. Another possible issue is the bill’s treatment of electronic payments, which requires advance notice and a no-fee alternative, reflecting concern about shifting processing costs to providers. The ERISA limitation also suggests some debate over the scope of state regulation of health plans.