House Bill 2437House Bill 2437Health Carrier Access PaymentHealth Carrier Access Payment

Commissioner Kim Holland

Oklahoma Insurance Department

Health Carrier Access PaymentHealth Carrier Access Payment

• House Bill 2437 Provides that:– All health carriers shall pay…an access payment of one percent

(1%) on all claims paid.

Who is the Health Carrier?Who is the Health Carrier?

• The Measure Defines a Health Carrier as:– Any entity or insurer authorized to provide health insurance or

health benefits pursuant to the laws of this state and any entity or person engaged in the business of making contracts of accident and health insurance.

Who is the Health Carrier?Who is the Health Carrier?

• Entities Specifically Included in the Definition of “Health Carrier” Include but are Not Limited to:– Third-Party Administrators – Health Maintenance Organizations – Self-Insured Employer Welfare Arrangements – Excess Carriers– Stop Loss Carriers– Multiple Employer Welfare Arrangements– Professional Employer Organizations – The Oklahoma State and Education Employees Group

Insurance Board

What are Claims Paid?What are Claims Paid?

• The Measure Defines “Claims Paid” as:– all payments made by a health carrier for health and medical

services for residents of Oklahoma.

• When are claims “incurred?”

What are Health and Medical Services?What are Health and Medical Services?

• Health and Medical Services are defined as but not limited to:– Any services included in the furnishing of medical care– Dental care to the extent covered under a medical insurance policy– Pharmaceutical benefits or hospitalization, including, but not limited to,

services provided in a hospital or other medical facility– Ancillary services, including, but not limited to, ambulatory services– Physician and other practitioner services, including, but not limited to,

services provided by an assistant to a physician, nurse practitioner or midwife

– Behavioral health services, including, but not limited to, mental health and substance abuse services

Claims Paid Do Not Include:Claims Paid Do Not Include:

• Claims-related expenses and general administrative expenses

• Claims paid for services rendered to nonresidents of this state

• Claims paid for services rendered outside the state to a person who is the resident of this state

• Claims paid pursuant to Medicare or Medicaid– For a complete list of exclusions see: 36 O.S. § 7300

Effective Date of House Bill 2437Effective Date of House Bill 2437

• The measure:– Does not contain an effective date– Becomes effective 90 days following the sine die adjournment of

the Legislature pursuant to Article 5 § 58 of the Oklahoma Constitution

– Becomes effective August 27, 2010

• Entities subject to House Bill 2437 should begin processing the access payment on claims incurred on and after August 27, 2010

When are Access Payments Due?When are Access Payments Due?

• For claims incurred from August 27 through August 31, 2010, payment should be combined with claims incurred for the month of September 2010 and will be due on October 31, 2010

• Subsequent payments are due 30 days after the end of each month

• Payments will be due the last day of the month

Remitting Access PaymentsRemitting Access Payments

• The Oklahoma Insurance Department will create an online form to be completed and submitted along with an electronic payment

• The form can be accessed online at: www.oid.ok.gov

Frequently Asked QuestionsFrequently Asked Questions

• Question: Who is responsible for remitting the access payment when more than one health carrier is involved?

• Answer: As a general rule - The entity responsible for paying or settling claims is the entity responsible for remitting the access payment to the Insurance Department.

Frequently Asked QuestionsFrequently Asked Questions

• Question: Can TPAs paying claims for more than one client aggregate the access payments?

• Answer: Access payments for each client should be remitted separately to the Insurance Department.

Frequently Asked QuestionsFrequently Asked Questions

• Question: Are plans such as student accident and sickness plans exempt from House Bill 2437?

• Answer: No- they are not exempt because student plans are considered comprehensive plans.

Frequently Asked QuestionsFrequently Asked Questions

• Question: For internal administration purposes, should the access payment be treated as a fee that must be submitted in a filing to the Department for approval?

• Answer: For purposes of administration by the health carrier, the access payment should be treated similarly to the premium tax. In other words, no separate filing- other than the required remittance form- is required to be submitted for approval to the Insurance Department with the payment.

Frequently Asked QuestionsFrequently Asked Questions

• Question: Does ERISA preempt the application of House Bill 2437?

• Answer: At this time, ERISA plans are not preempted under the definition of “health carrier” in House Bill 2437 based upon what can be deduced as the legislative intent of House Bill 2437.

Frequently Asked Questions

• Question: The statute indicates that access payments are required to be paid by health carriers on “claims paid and incurred”. Does “incurred” indicate the date of service, or the standard claim date of receipt?

• Answer: A claim is incurred on the date of service.

Frequently Asked Questions

• Question: The legislation references “claims-related expenses and general administrative expenses” as one of the exclusions of “claims paid”. What does the term “general administrative expenses” include, and who would be affected? In other words, should we include or exclude interest paid amounts into the 1% calculation?

• Answer: Upon determining the items excluded from “claims paid”, it can be concluded that remains is the payment for clinical services actually sent to the provider.

Frequently Asked Questions

• Question: For overpayments on claims, can a health carrier offset future assessments with amounts previously paid in the assessment?

• Answer: Claim overpayments that are recovered should be allowed to offset the amount due on claims, but only if the health carrier can document the recovery of the overpayment.

Frequently Asked Questions

• Question: House Bill 2437 indicates that carriers should exclude claims paid under retiree health benefit plans that are separate from and not included within benefit plans for existing employees. Does this include individuals over 65 that are still working since they would be covered within benefit plans for existing employees?

• Answer: Claims paid on persons over 65 who are still working and are still covered by the employer’s health plan are subject to the access payment. The employer’s health plan is the primary carrier for such an employee (Medicare is secondary).

Q & AQ & ACommissioner Kim Holland

Oklahoma Insurance Department