1     
HEALTH CARE DEBT COLLECTION

2     
2018 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: R. Curt Webb

5     
Senate Sponsor: Curtis S. Bramble

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions regarding health claims practices.
10     Highlighted Provisions:
11          This bill:
12          ▸     defines terms;
13          ▸     amends provisions requiring notification by a health care provider or a third party
14     for any action that may result in a report to a credit bureau; and
15          ▸     makes technical changes.
16     Money Appropriated in this Bill:
17          None
18     Other Special Clauses:
19          None
20     Utah Code Sections Affected:
21     AMENDS:
22          26-21-11.1, as enacted by Laws of Utah 2017, Chapter 321
23          31A-26-301.5, as last amended by Laws of Utah 2017, Chapter 321
24          58-1-508, as enacted by Laws of Utah 2017, Chapter 321
25          62A-2-112, as last amended by Laws of Utah 2017, Chapter 321
26     ENACTS:
27          31A-26-313, Utah Code Annotated 1953
28     

29     Be it enacted by the Legislature of the state of Utah:
30          Section 1. Section 26-21-11.1 is amended to read:
31          26-21-11.1. Failure to follow certain health care claims practices -- Penalties.
32          (1) The department may assess a fine of up to $500 per violation against a health care
33     facility that violates [Subsection 31A-26-301.5(4)] Section 31A-26-313.
34          (2) The department shall waive the fine described in Subsection (1) if:
35          (a) the health care facility demonstrates to the department that the health care facility
36     mitigated and reversed any damage to the insured caused by the health care [facility's] facility
37     or third party's violation; or
38          (b) the insured does not pay the full amount due on the bill that is the subject of the
39     violation, including any interest, fees, costs, and expenses, within 120 days after the day on
40     which the health care facility or third party makes a report to a credit bureau or [uses the
41     services of a collection agency] takes an action in violation of [Subsection 31A-26-301.5(4)]
42     Section 31A-26-313.
43          Section 2. Section 31A-26-301.5 is amended to read:
44          31A-26-301.5. Health care claims practices.
45          [(1) As used in this section:]
46          [(a) "Health care provider" means:]
47          [(i) a health care facility as defined in Section 26-21-2; or]
48          [(ii) a person licensed to provide health care services under:]
49          [(A) Title 58, Occupations and Professions; or]
50          [(B) Title 62A, Chapter 2, Licensure of Programs and Facilities.]
51          [(b) "Text message" means a real time or near real time message that consists of text
52     and is transmitted to a device identified by a telephone number.]
53          [(2)] (1) (a) Except as provided in Section 31A-8-407, an insured retains ultimate
54     responsibility for paying for health care services the insured receives.
55          (b) If a health care service is covered by one or more individual or group health
56     insurance policies, all insurers covering the insured have the responsibility to pay valid health
57     care claims in a timely manner according to the terms and limits specified in the policies.
58          [(3)] (2) A health care provider may:
59          (a) except as provided in Section 31A-22-610.1, bill and collect for any deductible,
60     copayment, or uncovered service; and
61          (b) bill an insured for services covered by health insurance policies or otherwise notify
62     the insured of the expenses covered by the policies.
63          [(4) (a) Except as provided in Subsection (4)(c), a health care provider may not make
64     any report to a credit bureau or use the services of a collection agency unless the health care
65     provider:]
66          [(i) (A) after the expiration of the time afforded to an insurer under Section
67     31A-26-301.6 to determine the insurer's obligation to pay or deny the claim without penalty ,
68     sends a notice described in Subsection (4)(b) to the insured by certified mail with return receipt
69     requested, priority mail, or text message; and]
70          [(B) makes the report to a credit bureau or uses the services of a collection agency after
71     the date stated in the notice in accordance with Subsection (4)(b)(ii)(A); or]
72          [(ii) (A) in the case of a Medicare beneficiary or retiree 65 years of age or older, after
73     the date Medicare determines Medicare's liability for the claim , sends a notice described in
74     Subsection (4)(b) to the insured by certified mail with return receipt requested, priority mail, or
75     text message; and]
76          [(B) makes the report to a credit bureau or uses the services of a collection agency after
77     the date stated in the notice in accordance with Subsection (4)(b)(ii)(B).]
78          [(b) A notice described in Subsection (4)(a) shall state:]
79          [(i) the amount that the insured owes;]
80          [(ii) the date by which the insured must pay the amount owed that is:]
81          [(A) at least 45 days after the day on which the health care provider sends the notice;
82     or]
83          [(B) if the insured is a Medicare beneficiary or retiree 65 years of age or older, at least
84     60 days after the day on which the health care provider sends the notice;]
85          [(iii) that if the insured fails to timely pay the amount owed, the health care provider
86     may make a report to a credit bureau or use the services of a collection agency; and]
87          [(iv) that each action described in Subsection (4)(b)(iii) may negatively impact the
88     insured's credit score.]
89          [(c) A health care provider satisfies the requirements described in Subsections (4)(a)
90     and (b) if the health care provider complies with the provisions of 26 C.F.R. Sec. 1.501(r)-6.]
91          [(5)] (3) Beginning October 31, 1992, all insurers covering the insured shall notify the
92     insured of payment and the amount of payment made to the health care provider.
93          [(6)] (4) A health care provider shall return to an insured any amount the insured
94     overpaid, including interest that begins accruing 90 days after the date of the overpayment, if:
95          (a) the insured has multiple insurers with whom the health care provider has contracts
96     that cover the insured; and
97          (b) the health care provider becomes aware that the health care provider has received,
98     for any reason, payment for a claim in an amount greater than the health care provider's
99     contracted rate allows.
100          [(7)] (5) (a) The commissioner shall make rules consistent with this chapter governing
101     disclosure to the insured of customary charges by health care providers on the explanation of
102     benefits as part of the claims payment process.
103          (b) These rules shall be limited to the form and content of the disclosures on the
104     explanation of benefits, and shall include:
105          [(a)] (i) a requirement that the method of determination of any specifically referenced
106     customary charges and the range of the customary charges be disclosed; and
107          [(b)] (ii) a prohibition against an implication that the health care provider is charging
108     excessively if the health care provider is:
109          [(i)] (A) a participating provider; and
110          [(ii)] (B) prohibited from balance billing.
111          Section 3. Section 31A-26-313 is enacted to read:
112          31A-26-313. Health care collection actions -- Notification required.
113          (1) As used in this section:
114          (a) (i) "Collection action" means any action taken to recover funds that are past due or
115     accounts that are in default:
116          (A) for health care services; and
117          (B) that directly results in an adverse report to a credit bureau.
118          (ii) "Collection action" includes using the services of a collection agency to engage in
119     collection action.
120          (iii) "Collection action" does not include:
121          (A) billing or invoicing for funds that are not past due or accounts that are not in
122     default; or
123          (B) providing the notice required in this section.
124          (b) "Credit bureau" means a consumer reporting agency as defined in 15 U.S.C. Sec.
125     1681a.
126          (c) "Text message" means a real time or near real time message that consists of text
127     and is transmitted to a device identified by a telephone number.
128          (2) (a) Before engaging in a collection action, a health care provider:
129          (i) shall, after the day on which the period of time for an insurer to pay or deny a claim
130     without penalty, described in Section 31A-26-301.6, expires, send a notice described in
131     Subsection (3) to the insured by certified mail with return receipt requested, priority mail, or
132     text message; and
133          (ii) for a Medicare beneficiary or retiree 65 years of age or older, shall, after the date
134     that Medicare determines Medicare's liability for the claim, send a notice described in
135     Subsection (3) to the insured by certified mail with return receipt requested, priority mail, or
136     text message.
137          (b) A health care provider may not engage in a collection action before the date
138     described in Subsection (3)(b) for that collection action.
139          (3) The notice described in Subsection (2)(a) shall state:
140          (a) the amount that the insured owes;
141          (b) the date by which the insured must pay the amount owed that is:
142          (i) at least 45 days after the day on which the health care provider sends the notice; or
143          (ii) if the insured is a Medicare beneficiary or retiree 65 years of age or older, at least
144     60 days after the day on which the health care provider sends the notice;
145          (c) that if the insured fails to timely pay the amount owed, the health care provider or a
146     third party may make a report to a credit bureau or use the services of a collection agency; and
147          (d) that each action described in Subsection (3)(c) may negatively impact the insured's
148     credit score.
149          (4) A health care provider is not subject to the requirements described in Subsection
150     (2) if the health care provider complies with the provisions of 26 C.F.R. Sec. 1.501(r)-6.
151          (5) A health care provider that contracts with a third party to engage in a collection
152     action is not subject to the requirements described in Subsection (2) if:
153          (a) entering into the contract does not require a report to a credit bureau by either the
154     health care provider or the third party; and
155          (b) the third party agrees to provide the notice in accordance with Subsection (2) before
156     the third party may engage in any activity that directly results in a report to a credit bureau.
157          (6) If a third party fails to comply with the notice requirements described in this
158     section, the health care provider that renders the health care service is liable for any penalty
159     resulting from the noncompliance of the third party.
160          Section 4. Section 58-1-508 is amended to read:
161          58-1-508. Failure to follow certain health care claims practices -- Penalties.
162          (1) As used in this section, "health care provider" means an individual who is licensed
163     to provide health care services under this title.
164          (2) The division may assess a fine of up to $500 per violation against a health care
165     provider [who] that violates [Subsection 31A-26-301.5(4)] Section 31A-26-313.
166          (3) The division shall waive the fine described in Subsection (2) if:
167          (a) the health care provider demonstrates to the division that the health care provider
168     mitigated and reversed any damage to the insured caused by the health care [provider's]
169     provider or third party's violation; or
170          (b) the insured does not pay the full amount due on the bill that is the subject of the
171     violation, including any interest, fees, costs, and expenses, within 120 days after the day on
172     which the health care provider or third party makes a report to a credit bureau or [uses the
173     services of a collection agency] takes an action in violation of [Subsection 31A-26-301.5(4)]
174     Section 31A-26-313.
175          Section 5. Section 62A-2-112 is amended to read:
176          62A-2-112. Violations -- Penalties.
177          (1) As used in this section, "health care provider" means a person licensed to provide
178     health care services under this chapter.
179          (2) The office may deny, place conditions on, suspend, or revoke a human services
180     license, if it finds, related to the human services program:
181          (a) that there has been a failure to comply with the rules established under this chapter;
182          (b) evidence of aiding, abetting, or permitting the commission of any illegal act; or
183          (c) evidence of conduct adverse to the standards required to provide services and
184     promote public trust, including aiding, abetting, or permitting the commission of abuse,
185     neglect, exploitation, harm, mistreatment, or fraud.
186          (3) The office may restrict or prohibit new admissions to a human services program, if
187     it finds:
188          (a) that there has been a failure to comply with rules established under this chapter;
189          (b) evidence of aiding, abetting, or permitting the commission of any illegal act; or
190          (c) evidence of conduct adverse to the standards required to provide services and
191     promote public trust, including aiding, abetting, or permitting the commission of abuse,
192     neglect, exploitation, harm, mistreatment, or fraud.
193          (4) (a) The office may assess a fine of up to $500 per violation against a health care
194     provider [who] that violates [Subsection 31A-26-301.5(4)] Section 31A-26-313.
195          (b) The office shall waive the fine described in Subsection (4)(a) if:
196          (i) the health care provider demonstrates to the office that the health care provider
197     mitigated and reversed any damage to the insured caused by the health care [provider's]
198     provider or third party's violation; or
199          (ii) the insured does not pay the full amount due on the bill that is the subject of the
200     violation, including any interest, fees, costs, and expenses, within 120 days after the day on
201     which the health care provider or third party makes a report to a credit bureau or [     uses the
202     services of a collection agency] takes an action in violation of [Subsection 31A-26-301.5(4)]
203     Section 31A-26-313.