Insurance Timely Payment

State and federal laws require that most payors pay clean claims within specific timeframes.  California law further requires health plans and insurers to pay interest on claims that are not paid within the required timeframe. 

Payor Type Timeframe for Payment Penalty
HMOs and their contracting medical groups/IPAs 45 working days
  • Non-emergent – 15% of amount due per annum
  • Emergent – greater of $15 or 15% per annum.
  • $10 surcharge per claim if plan fails to pay interest automatically.
PPOs 30 working days
  • Non-emergent – 10% of amount due per annum
  • Emergent – greater of $15 or 10% per annum.
ERISA 30 calendar days None
Medi-Cal 30 calendar days 0.25% of amount due per day
Medicare 30 calendar days 10.875% per annum (effective 4/23/2010)
Workers’ Comp 45 working days Payment is increased by 15% + 10% per annum

 Source: www.CMA.net

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