2229RE: The Rogak Report: The Most Useful Publication In The Insurance Claims Industry Insurance Department Releases Draft of New No Fault Regs
- Dec 2, 2009
A perfect example of why government should not be allowed into operating a business. Here they are trying to micromanage the insurance business.
Wait until they start operating their own insurance business.
Ask the DOI in NY and any member of Congress to define the term “insurance” and I will bet that they can’t give a good definition.
Barry Zalma, Esq., CFE
Barry Zalma, Inc.
Zalma Insurance Consultants
4441 Sepulveda Boulevard
CULVER CITY CA 90230-4847
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From: TheRogakReport@yahoogroups.com [mailto:TheRogakReport@yahoogroups.com] On Behalf Of Lawrence
Sent: Tuesday, December 01, 2009 3:44 PM
Subject: The Rogak Report: The Most Useful Publication In The Insurance Claims Industry Insurance Department Releases Draft of New No Fault Regs
PROPOSED CHANGES TO THE NO-FAULT REGULATIONS
The New York State Insurance Department has made public its draft of a newly-revised Regulation 68 (the no-fault regulations) , a copy of which is available at this link .
There are numerous changes, but among the highlights are some changes in the procedures for handling no-fault claims:
· Insurers must forward claim forms to an applicant within 7 calendar days of receiving notice (formerly 5 business days).
· EIPs are now referred to as "applicants" in the regs; the provider is now the "assignee" (unless, of course, the applicant does not assign benefits).
· Insurers must send their first verification requests within 14 calendar days of receiving a completed NF application (formerly 10 business days).
· Requests for further verification must be sent by the insurer within 21 calendar days of receiving completed claim forms (formerly 15 business days).
· New: there is a time limit on an applicant's response to verification requests: they must comply within 90 days (formerly there was no time limit).
· New: insurers may issue denials based on failure to comply with verification requests within 90 days, but only based on those requests sent to the assignor or assignee (not third parties).
· Insurers will be required to notify assignees that verification has been requested from a third party.
· IMEs must be scheduled to be held 10 to 30 calendar days from the date of the first verification request (not just that the notice be sent out within that time frame).
· IMEs can be set up either in the county where the "applicant" resides or any county where the applicant received treatment.
· Applicants must be notified of their right to reimbursement for expenses and lost wages incurred in attending the IME, but insurers do not have to pay those expenses until they are properly documented.
· Applicants are entitled to adjourn one IME in each specialty but only if the request is made at least 48 hours before the scheduled exam.
· If the applicant properly requests an adjournment of the first IME date, then the adjourned date will be considered the first IME date in the event of a no-show. In other words, in that event the applicant gets a second chance to show up at a re-scheduled IME date.
· IME requests do NOT delay pending bills.
· EUO dates must be scheduled to be held within 10 to 30 calendar days of the first verification request.
· Applicants must be advised of their right to expense and wage reimbursement for EUOs but insurers need not reimburse such until properly documented.
· EUO requests must set forth the subject matter of the EUO (e.g., staged accident) and the applicant's right to legal representation. However, at the EUO, questions may cover any subject related to proof of claim.
· Rules for rescheduling EUOs will be the same as those for IMEs, above.
· EUO requests will delay pending bills as well as bills received after the request is sent, and the delay stays in effect until the EUO is completed (or second no-show).
· Requests for EUOs of providers do delay all pending and subsequent bills until the EUO is completed (or second no-show).
· If the provider EUO is based on services rendered to a specific assignor, it only delays bills relating to that assignor.
· If the provider EUO is based on that provider's compliance with State licensing requirements, it delays all bills from that provider for all assignors.
· IME and EUO no-shows must be re-scheduled with a notice sent within 10 calendar days of the no-show, and the new date must be within 10 to 30 calendar days of the notice.
· IME and peer review reports must be signed by the health professional and cannot be modified by anyone other than that professional. Insurers cannot request any change in the reports but can request addendums.
· If first verification requests are not responded to within 25 to 30 calendar days, second verification requests must be sent by the insurer within 10 calendar days (i.e., 35 to 40 days after the first request); however, in the case of a first verification request sent to the applicant or a third party, the second notice of pending claim [delay letter] must be sent to the assignee [provider] within 25 to 30 calendar days of the first notice.
· IME or no-show denials must be forwarded to all known assignees.
· EUO denials must specify the "area" of the testimony that forms the basis of the denial. All EUO denials (based on testimony or no-show) must be sent to all known assignees.
· Even if EUO or IME denials are sent, additional denials must be timely sent in response to all subsequent bills.
· The requirement of sending denials "in duplicate" is eliminated.
· Proof of claim is deemed to "not have been provided" if the services billed for were not actually provided or for that portion of charges which exceed the fee schedule. (Implication: that a denial cannot be "untimely" in such circumstance? )
· No more prohibition on an insurer requesting that interest be waived or reduced, after suit or arb is filed.
· The circumstances calling for a $60 attorney fee are eliminated.
· After proof of claim but prior to filing suit or arb, the attorney fee is 20% plus interest with a maximum of $80. (The draft is ambiguous as to whether the $80 limit applies to the attorney fee, the interest, or both).
· The maximum cap on attorney fees is raised from $850 to $2500. The additional provision of extra attorney fees for extraordinary services is maintained.
· The provision which currently provides for forfeiture of attorney fees when provider charges exceed the fee schedule, is deleted.
· Assignments of benefits will be deemed to include a prohibition of the provider going back to the applicant for reimbursement of unpaid claims, unless the reason for non-payment is a violation of policy conditions by the applicant.
· All Terrain Vehicles are now included as vehicles for which no fault benefits apply.
· When the total of claims exceeds the policy limit, claims must be paid in the order in which "complete proof of claim" is provided (thus codifying case law which holds that it is not the order in which bills are received, but the order in which verification is completed, which determines priority of payment).
· Insurers are specifically not required to pay more than policy limits.
· Reimbursement for family members performing household services is no longer allowed.
· Once the insurer receives an NF-2 or NF-5 and reasonably believes the applicant was injured in the course of employment, the insurer must forward a new Form NF-9 "Agreement To Pursue Workers Compensation Benefits" to the applicant. This does not apply to independent livery drivers dispatched out of an independent livery base. The NF-9 requires the applicant to pursue workers comp and get turned down before being eligible for no fault benefits and the no fault insurer need not issue a denial or pay benefits until the signed form is received and a turndown from the workers comp board is received.
· Independent livery drivers who sustain very serious injuries listed in a new section of the regs (certain amputations, paraplegia, quadriplegia, total blindness or deafness) must go the Workers Comp Board for benefits under a special fund for them. All other injuries get paid by no fault.
· The regs for intercompany arbitration are changed so that a lack of coverage defense no longer excludes a claim from arbitration, but instead is subject to an arbitration decision.
· Intercompany arb is no longer limited to insurance companies (so self-insurers and perhaps TPAs can be brought in?)
· There is a new section devoted to MVAIC.
· The official forms have been revised.
The foregoing is merely my summary of the highlights of 152 pages of new regulations. I am sure there will be a lot of discussion and debate before the new regs take effect, and if past is prologue, somebody is going to bring suit to stop the new regs from being adopted.
Without question, lawyers will be the real winners, as whatever new regulations are enacted, every word and comma will be litigated as to their interpretation.
Let the games begin!
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