Missouri Statehouse
2:36 pm
Tue April 27, 2010

Nixon Signs 'Prompt Pay' Insurance Bill

Cape Girardeau, Mo. – Missouri Governor Jay Nixon has signed into law a bill requiring insurance companies to make timely payments to medical providers.

The so-called "prompt pay" bill imposes penalties on insurance companies for excessive delays in payment to providers. The law bans the practice of suspending claims, which the Governor describes as a limbo state where the claim is neither approved nor denied. The bill also establishes delinquency penalties on insurance companies when payment is not received within 45 days.

Speaking at Cape Girardeau's Saint Francis Medical Center, Governor Nixon said the bill should improve efficiency because health care providers will be able to devote employees to other concerns.

"More and more health care operations are having to employ a significant number of people that basically are hounding the insurance companies to pay the bills," said Nixon. "And quite frankly, on the insurance side, they're hiring a bunch of people to be on the other end of that phone line, to argue back and forth."

The law is in response to a study by the Missouri Department of Insurance that found that 26% of insurance claims are not reimbursed within 90 days of filing. Furthermore, 37% of claims from rural hospitals and 53% of claims from Southeast Missouri hospitals are not paid within 90 days.