New Claims Procedure Rules - Drastic Changes For Group Health Plans And Disability Plans

Background And Effective Date

The Department of Labor ("DOL") recently finalized the claims procedure rules, which are similar, but not identical, to the proposed claims procedure rules from 1998.

The new claims procedure rules are applicable for claims filed under a plan on or after January 1, 2002, and focus on claims under group health plans and disability plans.

Summary Of The Timing Under New Claims Procedure Rules

The following charts summarize the major differences between the current claims procedure rules and the new claims procedure rules.

CURRENT RULES

Type of Claim

Initial Benefit Determination

Appeal of Adverse Benefit Determination

Any welfare plan or any pension plan

90 days (unless special circumstances warrant an extension of time)

60 days (unless special circumstances warrant an extension of time)

NEW RULES

Type of Claim

Initial Benefit Determination

Appeal of Adverse Benefit Determination

Group Health Plan - Urgent Care

72 hours

72 hours

Group Health Plan - Non-Urgent Pre-Service Claims (relating to access to medical care)

15 days (with a 15-day extension in limited circumstances)

30 days

Group Health Plan - Non-Urgent Post-Service Claims (involving purely the payment or reimbursement of costs for medical care that has already been provided)

30 days (with a 15-day extension in limited circumstances)

60 days

Disability Plan

45 days (with up to two 30- day extensions in limited circumstances)

45 days (with up to a 45-day extension in limited circumstances)

All other types of welfare plans and all pension plans

(same as current rules)

(same as current rules)

Note that special rules apply for incomplete or incorrectly filed claims, and for claims relating to concurrent care decisions (when a group health plan has approved an ongoing course of treatment to be provided over a period of time or number of treatments).

"Claims Involving Urgent Care"

A "claim involving urgent care" means a claim for which the non-urgent care time frames either:

could seriously jeopardize the life or health of the claimant or the ability of the claimant to regain maximum function, or

in the opinion of a physician with knowledge of the claimant's medical condition, would subject the claimant to severe pain that cannot be adequately managed without the care or treatment that is the subject of the claim.

The determination of whether a claim involves urgent care is usually made by an individual acting on behalf of the plan and...