Senate Bill 2845

AN ACT ENTITLED THE "MISSISSIPPI HONORING PATIENTS' ASSIGNMENT OF HEALTH CARE BENEFITS ACT"; TO PROVIDE DEFINITIONS; TO PROVIDE THAT HEALTH CARE COVERAGE SHALL BE PAID DIRECTLY TO ANY SIMILARLY LICENSED NONPARTICIPATING PROVIDER WITH A WRITTEN ASSIGNMENT OF BENEFITS UNDER CERTAIN CONDITIONS; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Title. This act shall be known and may be cited as the "Honoring Patients' Assignment of Health Care Benefits Act."

SECTION 2. Purpose. The Legislature hereby finds and declares that:

(a) Often a patient will see a health care provider and authorize, in writing, that a covered entity shall issue payment for services directly to the health care provider, whether or not the provider has a contract with the covered entity.

(b) Despite this authorization, however, a covered entity may fail to honor this valid "assignment of benefits" from the patient to the health care provider.

(c) While a covered entity may claim the lack of privity of contract between the covered entity and the provider as the reason for the refusal to honor these agreements, the reality is that these entities prohibit such assignments in order to create a market advantage for themselves.

(d) By doing so, the covered entity can pressure a nonparticipating health care provider into entering into a contract with the covered entity and thus becoming a participating provider.

(e) As covered entities gain a greater economic advantage, the state has a strong public interest in ensuring that the covered entity is obliged to pay a health care provider directly, when a valid assignment of benefits exists. Not doing so will strengthen a covered entity's market power and allow it to pressure nonparticipating providers into entering into contracts with the covered entity, in order to ensure that the provider is paid for services rendered.

SECTION 3. Definitions. As used in this act: (a) The term "covered entity" includes, but is not limited to, any entity responsible for payment of health care services, including, but not limited to, all entities that pay or administer claims on behalf of other entities.

(b) The term "assignment of benefits" means any written instrument executed by the participant, beneficiary or enrollee (or authorized representative) which assigns to the treating physician or other health care provider the participant's, beneficiary's or enrollee's right to receive reimbursement for medical services or items rendered to the patient.

SECTION 4. Requirements. (1) Whenever a covered entity issues a health care related contract that provides that any of its benefits are payable to a participating health care provider for services rendered, the covered entity shall be required to pay such benefits directly to any similarly licensed nonparticipating provider who has rendered such services, where the nonparticipating provider has a written assignment of benefits.

(2) Where a nonparticipating provider has a written assignment of benefits, the provider must provide written notice of such assignment to the covered entity.

(3) The covered entity shall be required to send such benefit payments directly to the provider who has the written assignment.

(4) When payment is made directly to the health care provider, the covered entity shall give written notice of such payment to the participant, beneficiary or enrollee (or authorized representative).

(5) Any covered entity that does not comply with subsections (1) through (4) shall pay one percent (1%) interest, compounded daily, accruing from the day after payment was due, on any and all amounts of the claim(s) that remain unpaid thirty (30) days after receipt of all documents reasonably needed to determine the claim.

(6) If an assignment of benefits is made, but the covered entity pays the benefits to the participant, beneficiary or enrollee (or authorized representative), the covered entity shall also pay those benefits to the provider of health care who received the assignment within thirty (30) days of receiving notice of the incorrect payment from the provider.

(7) Where there is a good faith dispute regarding the legitimacy of a claim, the appropriate amount of reimbursement, or the authorization for the assignment of benefits, notice that a dispute exists shall be promptly (and in no event later than fourteen (14) days after receiving the claim) furnished by the covered entity, to the physician (or his or her authorized representative) or other provider upon receipt of the claim.

(8) By accepting an assignment of benefits, the provider is not agreeing to accept the covered entity's fee schedule or specific payment rate as payment in full, a partial payment or as the appropriate payment.

(9) Any contract provision violating this act shall be considered null and void.

SECTION 5. This act shall take effect and be in force from and after July 1, 2011.