Texas Department Fines More Health Carriers

The alleged violations include failure to pay clean claims on time, failure to follow required audit payment procedures, failure to send timely notices when claims were incomplete and failure to maintain adequate complaint records.

Company representatives were not immediately available for comment, but the Texas department says all 12 companies named in the latest consent orders agreed to the orders without admitting that they had violated any Texas insurance laws or regulations.

The Texas department is not sure how many insurance companies are paying legitimate claims on time, according to Lee Jones, a department spokesman.

Jones tried to dispel the idea that the Texas department might see prompt-payment fines as a cash cow by pointing out that the fines are paid to the state treasury, not the Texas department. The fine money is not earmarked for any specific programs, Jones says.

Jones says the department focuses on those health insurers and HMOs that seem to trigger a large number of complaints.

“We identify the ones that really have serious problems,” Jones says.

The department has had thousands of complaints from doctors, Jones says, “not all of them valid, by a long shot.”

Texas law requires HMOs and insurance companies with preferred provider plans to pay properly documented and properly filed, or “clean,” claims from their network physicians and providers no later than 45 days after receipt.

Montemayor appointed Senior Associate Commissioner Audrey Selden of the department’s Consumer Protection Program in April 2001 to be the department’s physician and provider ombudsman. She has coordinated the department’s enforcement effort as well as programs to educate insurers, HMOs, physicians and providers about their rights and responsibilities under the prompt-payment law.