§ 9418a. Processing claims, downcoding, and adherence to coding rules

(a) Health plans, contracting entities, covered entities, and payers shall accept and initiate the processing of all health care claims submitted by a health care provider pursuant to and consistent with the current version of the American Medical Association's Current Procedural Terminology (CPT) codes, reporting guidelines, and conventions; the Centers for Medicare and Medicaid Services Healthcare Common Procedure Coding System (HCPCS); American Society of Anesthesiologists; the National Correct Coding Initiative (NCCI); the National Council for Prescription Drug Programs coding; or other appropriate nationally recognized standards, guidelines, or conventions approved by the Commissioner.

(b) When editing claims, health plans, contracting entities, covered entities, and payers shall adhere to edit standards except as provided in subsection (c) of this section:

(1) the CPT, HCPCS, and NCCI;

(2) national specialty society edit standards; or

(3) other appropriate nationally recognized edit standards, guidelines, or conventions approved by the Commissioner.

(c) Adherence to the edit standards in subdivision (b)(1) or (2) of this section is not required:

(1) When necessary to comply with State or federal laws, rules, regulations, or coverage mandates; or

(2) For edits that the payer determines are more favorable to providers than the edit standards in subdivisions (b)(1) through (3) of this section or to address new codes not yet incorporated by a payer's edit management software, provided the edit standards are developed with input from the relevant Vermont provider community and national provider organizations and provided the edits are available to providers on the plan's websites and in their newsletters.

(d) Nothing in this section shall preclude a health plan, contracting entity, covered entity, or payer from determining that any such claim is not eligible for payment in full or in part, based on a determination that:

(1) the claim is contested as defined in subdivision 9418(a)(2) of this title;

(2) the service provided is not a covered benefit under the contract, including a determination that such service is not medically necessary or is experimental or investigational;

(3) the insured did not obtain a referral, prior authorization, or precertification, or satisfy any other condition precedent to receiving covered benefits from the health care provider;

(4) the covered benefit exceeds the benefit limits of the contract;

(5) the person is not eligible for coverage or is otherwise not compliant with the terms and conditions of his or her coverage agreement;

(6) the health plan has a reasonable belief that fraud or other intentional misconduct has occurred; or

(7) the health plan, contracting entity, covered entity, or payer determines through coordination of benefits that another entity is liable for the claim.

(e) Nothing in this section shall be deemed to require a health plan, contracting entity, covered entity, or payer to pay or reimburse a claim, in full or in part, or to dictate the amount of a claim to be paid by a health plan, contracting entity, covered entity, or payer to a health care provider.

(f) No health plan, contracting entity, covered entity, or payer shall automatically reassign or reduce the code level of evaluation and management codes billed for covered services (downcoding), except that a health plan, contracting entity, covered entity, or payer may reassign a new patient visit code to an established patient visit code based solely on CPT codes, CPT guidelines, and CPT conventions.

(g) Notwithstanding the provisions of subsection (d) of this section, and other than the edits contained in the conventions in subsections (a) and (b) of this section, health plans, contracting entities, covered entities, and payers shall continue to have the right to deny, pend, or adjust claims for services on other bases and shall have the right to reassign or reduce the code level for selected claims for services based on a review of the clinical information provided at the time the service was rendered for the particular claim or a review of the information derived from a health plan's fraud or abuse billing detection programs that create a reasonable belief of fraudulent or abusive billing practices, provided that the decision to reassign or reduce is based primarily on a review of clinical information.

(h) Every health plan, contracting entity, covered entity, and payer shall publish on its provider website and in its provider newsletter if applicable:

(1) the name of any commercially available claims editing software product that the health plan, contracting entity, covered entity, or payer utilizes;

(2) the standard or standards, pursuant to subsection (b) of this section, that the entity uses for claim edits;

(3) the payment percentages for modifiers; and

(4) any significant edits, as determined by the health plan, contracting entity, covered entity, or payer, added to the claims software product after the effective date of this section, which are made at the request of the health plan, contracting entity, covered entity, or payer.

(i) Upon written request, the health plan, contracting entity, covered entity, or payer shall also directly provide the information in subsection (h) of this section to a health care provider who is a participating member in the health plan's, contracting entity's, covered entity's, or payer's provider network.

(j) For purposes of this section, "health plan" includes a workers' compensation policy of a casualty insurer licensed to do business in Vermont.

(k) BlueCross BlueShield of Vermont and the Vermont Medical Society are requested to continue convening a work group consisting of health plans, health care providers, State agencies, and other interested parties to study the edit standards in subsection (b) of this section, the edit standards in national class action settlements, and edit standards and edit transparency standards established by other states to determine the most appropriate way to ensure that health care providers can access information about the edit standards applicable to the health care services they provide. The work group is requested to provide an annual progress report to the House Committee on Health Care and the Senate Committees on Health and Welfare and on Finance.

(l) With respect to the work group established under subsection (k) of this section and to the extent required to avoid violations of federal antitrust laws, the Department shall facilitate and supervise the participation of members of the work group. (Added 2007, No. 203 (Adj. Sess.), § 28, eff. June 10, 2008; amended 2009, No. 61, § 30; 2011, No. 21, § 18; 2011, No. 171 (Adj. Sess.), § 11a, eff. May 16, 2012.)