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5 AN ACT RELATING TO INSURANCE; REQUIRING THE TIMELY PAYMENT OF VALID
6 INSURANCE CLAIMS MADE BY A CONTRACTING HEALTH CARE PROVIDER.
7 This act affects sections of Utah Code Annotated 1953 as follows:
9 31A-26-301, as enacted by Chapter 242, Laws of Utah 1985
10 Be it enacted by the Legislature of the state of Utah:
11 Section 1. Section 31A-26-301 is amended to read:
12 31A-26-301. Timely payment of claims.
13 (1) Unless otherwise provided by law, an insurer shall timely pay every valid insurance
14 claim made by an insured or a contracting provider for services rendered to an insured. By rule
15 the commissioner may prescribe the kinds of notice and proof of loss that will establish validity,
16 the manner in which an insurer may make a bona fide denial of a claim, the periods of time within
17 which payment is required to be made to be timely, and the reasonable interest rates to be charged
18 upon late claim payments.
19 (2) Notwithstanding Subsection (1), the payment of a claim is not overdue during any
20 period in which the insurer is unable to pay the claim because there is no recipient legally able to
21 give a valid release for the payment, or in which the insurer is unable to determine who is entitled
22 to receive the payment, provided that the insurer has promptly notified the claimant of the inability
23 and has offered in good faith to pay the claim promptly when the inability is removed.
24 (3) This section applies only to claims made by claimants and contracting providers in
25 direct privity of contract with the insurer.
26 (4) For purposes of this section, "contracting provider" means:
27 (a) a "participating provider" as defined in Section 31A-8-101 ; or
28 (b) a "preferred health care provider" as described in Section 31A-22-617 .
Legislative Review Note
as of 12-17-99 10:37 AM
A limited legal review of this legislation raises no obvious constitutional or statutory concerns.