Health claims authorization processing and payment act

Please note:

• References to “carrier” throughout include any subcontractor of a carrier that performs the referenced function on behalf of the carrier.
• Unless indicated otherwise, responses do not apply to self-funded plans, to policies issued and delivered in a state other than New Jersey, or to limited benefits plans that do not provide hospital or medical expense benefits.

Yes. An arbitration request will not be considered unless it is for a total disputed amount of $1,000 or more. However, the HCAPPA does not require that each disputed claim amount presented for arbitration equal $1,000 or more. The HCAPPA permits health care providers to aggregate disputed claim amounts (for claims that have been through the internal claims payment appeal process filed on the Health Care Providers Application to Appeal a Claims Determination form) to reach the $1,000 arbitration threshold.

If a carrier presents a request for arbitration, the disputed amount would also have to meet the $1,000 threshold level.

Yes, there are several standards that must be met. First, all disputed claim amounts aggregated for arbitration must be from claims that have been submitted to a carrier’s internal claims payment appeal mechanism (and the appeal mechanism exhausted). Second, all claims in the aggregation of disputed claims MUST be timely. Untimely claims will be removed from the aggregation, and if the remaining claims do not meet the threshold amount, none of the claims will be considered for arbitration at that time. Third, disputed claim amounts should be aggregated by carrier and covered person, OR by carrier and Current Procedural Terminology (CPT) code. Other aggregation models are not acceptable.

The disputed claim amount is the difference between what the provider received from the carrier and what the provider contends he should have received from the carrier.

The HCAPPA specifies that health care providers may file a request for arbitration of a disputed claim amount within 90 days AFTER receiving a determination on an internal claims payment appeal from the carrier when the appeal has been filed on the Health Care Provider Application to Appeal a Claims Determination form. If the appeal is not filed on the Health Care Provider Application to Appeal a Claims Determination form, the resulting determination is not eligible for arbitration. If more than 90 days has elapsed since the health care provider received the internal claims payment appeal determination, the claim is no longer eligible for submission for arbitration. (But see Question 10 below for special circumstances.)

No. The health care provider only has a right to use the PICPA if the disputed claim amount is: (a) $1,000 or can be aggregated with other disputed claim amounts to reach the $1,000 threshold; (b) each disputed claim amount is submitted in a timely manner; and, (c) the health care provider has exhausted the carrier’s internal claims payment appeal mechanism for each disputed claim amount to be submitted (but also see Question 10).

Yes, a health care provider must submit the Health Care Provider Application to Appeal a Claims Determination form to appeal a claims payment determination to a carrier before submitting the disputed claim amount(s) for arbitration. However, if the carrier fails to respond timely to a health care provider after receipt of the health care provider’s appeal application, the health care provider may pursue the arbitration process without waiting for a determination from the carrier. In addition, the carrier may waive the requirement that the claims appeal process be exhausted.

Each carrier is required to have the application available on their website. A generic version of the form – which a health care provider may use – is available on the Department’s website at www.state.nj.us/dobi/chap352/352application.doc (MS Word) .

No. This type of dispute should be brought – with the consent of the patient – to the carrier’s internal UM appeal program, and then to the Independent Health Care Appeals Program (IHCAP) if the health care provider or patient is dissatisfied with the outcome of the Stage 1 and Stage 2 UM appeals.

The IHCAP is a program that provides an independent external review about disputes regarding utilization management (UM) determinations. The IHCAP primarily reviews questions of whether a particular set of health care services are (or were) medically necessary for an individual’s care, including whether a service is medically necessary or cosmetic. The IHCAP will also review questions of whether a service is medical rather than dental, experimental or investigational, whether a condition was preexisting, and certain other questions where independent medical expertise is warranted. The PICPA is a program that provides an independent external review of claims payment questions that do not involve disputes regarding UM determinations. The PICPA will review questions of whether a claim was appropriately denied for administrative reasons, in a timely manner. The PICPA will also review questions of whether amounts paid on a claim were appropriate under the contract terms and applicable fee schedules, if any, and whether interest was paid appropriately, if due. The decisions obtained through the IHCAP are binding upon the carrier. The decisions obtained through the PICPA are binding on both parties. The IHCAP costs a health care provider $25 to file the UM appeal, with the carrier paying the review costs of $600 (and up) after a decision is rendered. The exact cost to the carrier depends upon which Independent Utilization Review Organization (IURO) reviews the case. The cost of the PICPA’s review and arbitration fees is split evenly between the health care provider and the carrier. Payment of half of the review fee and arbitration fee must accompany the arbitration request, and the remaining one half will be collected later by the arbitration organization from the other party. The exact cost for use of the PICPA services depends upon the amount and/or number of claims in dispute. The PICPA process allows for disaggregation of cases when appropriate.

The application and arbitration process is composed of two parts, and there is a separate fee for each part of the process. The basic cost is $72.50 (per party) for the initial review fee, and $150.00 (per party) for the arbitration, for a total of $222.50 for the health care provider and $222.50 for the carrier. HOWEVER, the basic fees are for a single claim with a disputed amount worth $1,000. Claims involving multiple claim lines and more than $2,000 may be disaggregated. When a case is disaggregated both the provider and the carrier will be notified. Additional initial review fees and arbitration fees will be required if a case is disaggregated.

Parties interested in pursuing arbitration need to access the application at https://dispute.maximus.com/nj/indexNJ. When first accessing the website, a health care provider or carrier will be requested to create an account with the arbitration organization, MAXIMUS. When subsequently accessing the website regarding either an existing case, or to file a new request for arbitration, the health care provider or carrier will need to log in using the same user account information.

The application can be completed and submitted directly online, with electronic attachments (including scanned documents). HOWEVER, payment cannot be accepted online at this time, so payment must be submitted separately by mail or courier service. Upon completion of the application, a Case ID Number will be generated. The health care provider (or carrier) should include the Case ID Number with the payment and any additional materials that could not be submitted electronically to assure that information can be matched correctly.

In addition to the requirement that payment be submitted by mail or courier service, MAXIMUS requires that payment be by check or money order, and that parties submit a separate payment for the review fee and the arbitration fee. Thus, an applicant (and the responding party) must submit two checks or money orders for each application, made payable to MAXIMUS, Inc., and submitted to the attention of the NJPICPA at: 3750 Monroe Avenue, Suite 705, Pittsford, NY 14534 .

The application is considered filed when the initial online submission is complete and a specific case number is assigned. Note: The date of filing of the request for arbitration is not contingent upon receipt of the fees. So, if an application is submitted online 87 days after a decision on the appeal of the claim was rendered by the carrier, but the fees are not received by the arbitration organization until four days later, the application will be considered timely.

Yes. The arbitration organization does not sideline a case pending receipt of the appropriate fees from the applicant. However, the arbitration organization is not required to issue any determinations until the applicant’s fees are received.

Responding parties are expected to submit information in a timely manner (typically, within 10 days of the request). If a responding party fails to submit appropriate documentation and fees as required, the arbitration organization will proceed with its review of the documentation available to it, and will render a determination.

The arbitrator’s decision will be based on the written record, and the arbitrator will not accept oral arguments. However, the arbitration organization will speak with the parties regarding administrative matters – for instance, to discuss whether a particular document was received.

The parties may resolve the matter on their own at any point prior to the arbitration organization rendering a decision, in which instance, no binding decision will be issued. However, so long as the matter was accepted for arbitration, both parties remain liable for the full costs of the arbitration, and no fees will be refunded. Further, the case will remain a matter of record, and will be considered within statistical data.

No. A health care provider has a right to request and proceed with arbitration with or without the consent of the patient. However, the arbitrator will require the written consent from the patient in order to review any medical documentation related to the issue being arbitrated. The information available to the arbitrator will be limited when the health care provider does not obtain a patient’s authorization for release of medical records, which, in turn, may have an impact upon the arbitrator’s decision.

The Department has developed a standard consent form that provider’s may use to obtain consent from patients for release of medical information. This form (MS Word) may also be used for obtaining consent to represent a patient in a utilization management appeal. Consent may be obtained at the time services are being sought or at a later time.

No. However, a health care provider may add its name to the form where indicated, and may make an accurate translation of the form into additional languages as may be appropriate.

Reviews will be performed by independent and impartial health claims professionals with at least five years of health claims processing experience.

The arbitration determination must be in writing, and must be signed by the arbitrator. The determination must include a statement of the issues in dispute, the arbitrator’s findings, and the conclusions on which the determination is based.

The arbitration determination is binding on both parties. The HCAPPA does not provide a process for appealing the arbitration determination.

In general, any monies owed should be paid within 10 business days following the date of the arbitrator’s determination. In instances in which the arbitration may involve an attempt to collect an overpayment by a carrier, and the arbitrator’s determination favors the carrier, the carrier may seek to offset against claims immediately if the 45-day notice period required for such collection actions has already elapsed.

No. Payments pursuant to arbitration awards must be made to the provider within 10 business days following the date of the arbitration decision irrespective of the provider's participating status with the payer. As of the date a provider files an application for arbitration with MAXIMUS, payments made by a payer to a member, whether before or after the arbitration decision is issued, do not satisfy the payment obligations imposed by the ultimate arbitration decision. As of the date a provider files an application for arbitration with MAXIMUS, a carrier that nevertheless remits payment to a member rather than the provider is not entitled to take the position that the provider must collect that sum from the member, nor may the carrier require the provider to wait for payment until the carrier has recouped the payment from the member.

No. An arbitration may only be terminated/withdrawn by the initiating party. Thus, if an arbitration is initiated by a provider, and a payer subsequently makes a payment with respect to the disputed claim and requests that the arbitration be terminated, MAXIMUS will not act on such request unless the provider affirmatively requests via direct communication to MAXIMUS that the arbitration be terminated. Should the provider not so request, the matter would proceed to a binding decision, notwithstanding the payer's post-filing payment. However, such payment, if appropriately documented and made directly to the provider, may serve to reduce the ultimate amount payable pursuant to the arbitration decision.

It depends. If the arbitrator determines that a:

carrier withheld funds because the health care provider did not submit appropriate information (as requested by the carrier), the carrier will not owe interest to the health care provider;

No. The Department and/or arbitration organization will generate data and reports from the arbitration requests, some of which may be available for release to the public; however, the reports will contain only aggregated data, and nothing that would identify any personal health information.

No, the arbitration mechanism is designed to be a self-help process for health care providers. A health care provider always has the right to hire legal representation, of course, but filing with the arbitration organization and supplying the supporting documentation should not require the particular expertise of a legal professional or other consultant.