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S.B. 50
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HEALTH CARE BENEFITS - GRIEVANCE
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REVIEW PROCESS
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2000 GENERAL SESSION
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STATE OF UTAH
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Sponsor: Peter C. Knudson
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AN ACT RELATING TO INSURANCE; DEFINING TERMS; PERMITTING AN INSURED
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TO CHALLENGE AN ADVERSE HEALTH INSURANCE DECISION THROUGH AN
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INTERNAL REVIEW PROCESS AND BY AN INDEPENDENT REVIEW PROCESS;
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REQUIRING THE INSURANCE COMMISSIONER TO ADOPT RULES; AND MAKING
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CONFORMING AMENDMENTS.
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This act affects sections of Utah Code Annotated 1953 as follows:
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AMENDS:
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31A-4-116, as enacted by Chapter 143, Laws of Utah 1999
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ENACTS:
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31A-22-625, Utah Code Annotated 1953
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Be it enacted by the Legislature of the state of Utah:
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Section 1.
Section
31A-4-116
is amended to read:
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31A-4-116. Grievance procedures.
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(1) If an insurer has established a complaint resolution body or grievance appeal board,
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the body or board shall include at least one consumer representative.
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(2) Grievance procedures for health insurance policies and health maintenance
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organization contracts shall be established in accordance Section
31A-22-625
.
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Section 2.
Section
31A-22-625
is enacted to read:
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31A-22-625. Grievance review process.
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(1) As used in this section:
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(a) "Grievance" means a written or, if accepted by the insurer, oral statement that indicates
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an insured's disagreement with an insurance-related decision of the insurer.
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(b) "Independent review" means a process that:
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(i) may be created and operated internally by an insurer or externally by a third party;
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(ii) satisfies the requirements of Subsection (4)(b)(ii);
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(iii) is designated by the insurer; and
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(iv) renders an independent and impartial decision on a grievance submitted by an insured.
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(c) "Insured" is as defined in Section
31A-1-301
and includes a person who is authorized
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to act on the insured's behalf.
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(d) "Insurer" is as defined in Section
31A-1-301
and includes:
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(i) a health maintenance organization; and
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(ii) a third-party administrator that offers, sells, manages, or administers a health insurance
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policy or health maintenance organization contract that is subject to this title.
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(e) "Internal review" means the process an insurer uses to review an insured's grievance
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before the grievance is submitted for independent review.
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(2) This section applies generally to health insurance policies and health maintenance
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organization contracts in effect on or after January 1, 2001.
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(3) (a) An insured may submit a grievance to the insurer.
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(b) The insurer shall conduct an internal review of the insured's grievance.
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(c) Consistent with rules adopted pursuant to Subsection (4), an insured who disagrees
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with the results of an internal review may submit the grievance for an independent review if the
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grievance involves the payment of a claim or the denial of coverage.
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(4) Before October 1, 2000, the commissioner shall adopt rules that:
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(a) establish a maximum flat fee that may be charged to an insured for requesting a
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decision from an independent review board and the circumstances under which the fee shall be
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waived on the basis of financial hardship; and
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(b) establish minimum standards for:
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(i) internal reviews;
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(ii) internal and external independent reviews to ensure independence and impartiality;
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(iii) the types of grievances that may be submitted to an independent review; and
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(iv) the timing of the review process, including an expedited review when medically
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necessary.
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(5) Nothing in this section may be construed as:
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(a) expanding, extending, or modifying the terms of a policy or contract with respect to
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benefits or coverage;
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(b) permitting an insurer to charge an insured for the internal review of a grievance;
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(c) restricting the use of arbitration h [
in connection with
]
SUBSEQUENT TO
h an
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independent review; or
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(d) altering the legal rights of any party to seek court or other redress in connection with:
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(i) an adverse decision resulting from an independent review, except that if the insurer is
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the party seeking legal redress, the insurer shall pay for the reasonable attorneys fees of the insured
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related to the action and court costs; or
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(ii) a grievance or other claim that is not eligible for submission to independent review.
Legislative Review Note
as of 1-26-00 7:18 PM
A limited legal review of this legislation raises no obvious constitutional or statutory concerns.