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An Act To Create Uniform Claims Paying Practices in Long-term Care Insurance Policies
Emergency preamble. Whereas, acts and resolves of the Legislature do not become effective until 90 days after adjournment unless enacted as emergencies; and
Whereas,  Maine seniors with long-term care insurance are experiencing delays in receiving claims payments from insurers; and
Whereas,  delays in claims payments are causing undue stress on seniors; and
Whereas,  this legislation establishes notice requirements and specific time periods in which insurers are required to pay claims once all necessary documentation supporting the claims is submitted; and
Whereas,  it is necessary for this legislation to take effect immediately to provide relief to those seniors with long-term care insurance; and
Whereas,  in the judgment of the Legislature, these facts create an emergency within the meaning of the Constitution of Maine and require the following legislation as immediately necessary for the preservation of the public peace, health and safety; now, therefore,
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  24-A MRSA §2436, sub-§6  is enacted to read:
 
6.      This section does not apply to a claim for payment of benefits under a policy or certificate of long-term care insurance delivered or issued for delivery in this State.
Sec. 2.  24-A MRSA §5083  is enacted to read:
§ 5083. Payment of claims
 
1.  Notice of claim for benefits; response by insured.     Notwithstanding any other provision of this Title, upon receipt of a notice of claim for benefits under a policy or certificate of long-term care insurance delivered or issued for delivery in this State, an insurer, whether actively marketing or renewing long-term care insurance in this State, shall provide the insured a written statement with sufficient detail to permit the insured to understand and respond with the documentation specified in subsection 2. The written statement must be provided by the insurer within 10 business days following receipt of the notice of claim. For purposes of this section, "insured" includes a person designated by the insured as the insured's representative.
 
2.  Documentation.     The documentation an insurer may require of an insured for the payment of a claim for benefits under a policy or certificate of long-term care insurance includes, but is not limited to:
 
A.  A statement from the insured making the claim for benefits;
 
B.  A signed release permitting the insurer to obtain personal health care information about the insured pursuant to the federal Health Insurance Portability and Accountability Act of 1996;
 
C.  A statement from the insured's physician, including the appropriate diagnosis and a treatment and care plan for the insured;
 
D.  A statement from the long-term care provider rendering services to the insured, including an itemized bill for services, the provider's license number and any daily nursing notes; and
 
E.  A copy of any power of attorney executed by the insured.
 
Except for information solely in the possession of the insured, the burden is on the insurer to obtain any information other than that described in paragraphs A to E that is reasonably necessary to pay or continue paying the claim. The insured has a continuing obligation to cooperate with the insurer in order for the insurer to obtain needed information.
 
3.  Payment of claim.     A claim for payment of benefits under a policy or certificate of long-term care insurance delivered or issued for delivery in this State is payable within 30 days after the documentation and information identified in subsection 2 as reasonably necessary to pay the claim for benefits have been received by the insurer. Within 30 days after receipt of that documentation and information, the insurer shall either pay the claim or issue a written notice to the insured declining to pay all or part of the claim and the specific reason for denial in accordance with this subsection.
 
A.  An insurer may not extend the time for payment of a claim beyond 30 days after receipt of documentation and information related to a technical issue as designated in rules adopted by the bureau.
 
B.  Except as provided in paragraph A, an insurer may delay payment of a claim and request additional documentation and information related to a substantive issue as designated in rules adopted by the bureau.
 
4.  Ongoing claim.     Except for information solely in the possession of the insured, if, during the course of an ongoing claim for benefits paid on a monthly or recurring basis, the insurer identifies the need for additional reasonable documentation to ensure the insured remains entitled to benefits under the policy or certificate of long-term care insurance, the burden is on the insurer to obtain that information. The insured has a continuing obligation to cooperate with the insurer in order for the insurer to obtain needed information.
 
5.  Appeals of claims denials.     An insured who receives a claims denial in accordance with this section has the right to internal appeal and, after exhausting an insurer's internal appeals process, the right to request an external review. The superintendent shall adopt rules to determine the standards for internal appeal and external review in a manner consistent with model legislation adopted by the National Association of Insurance Commissioners, or its successor organization. The written notice to the insured declining to pay all or part of the claim as required by subsection 3 must include a statement informing the insured of the insured's rights to internal appeal and external review and a statement of the insured's right to seek assistance or file a complaint with the bureau and the toll-free telephone number of the bureau.
 
6.  Interest on overdue claim.     An undisputed claim that is not paid within 30 days is overdue. If an insurer fails to pay an undisputed claim or any undisputed part of the claim when due, the amount of the overdue claim or part of the claim bears interest at the rate of 1 1/2% per month after the due date.
 
7.  Attorney's fees.     Reasonable attorney's fees for advising and representing a claimant on an overdue claim or action for an overdue claim must be paid by the insurer if overdue benefits are recovered in an action against the insurer or if overdue benefits are paid after receipt of notice of the attorney's representation.
 
8.  No limitation on action by insured.     This section does not prohibit or limit any claim or action for a claim that the insured has against the insurer.
 
9.  Rules.     The superintendent may adopt or amend rules in order to carry out the purposes of this section. Rules adopted pursuant to this section, including amendments to existing rules designated as major substantive, are routine technical rules as defined in Title 5, chapter 375, subchapter 2-A.
Sec. 3. Bureau of Insurance report; rules. By March 1, 2014, the Department of Professional and Financial Regulation, Bureau of Insurance shall submit a report to the Joint Standing Committee on Insurance and Financial Services on the rules adopted by the bureau as required by the Maine Revised Statutes, Title 24-A, section 5083.
Emergency clause.  In view of the emergency cited in the preamble, this legislation takes effect when approved.
 
Effective 90 days following adjournment of the 126th Legislature, First Regular Session, unless otherwise indicated.