Medicare Advantage Prompt Pay Act
Summary
The Medicare Advantage Prompt Pay Act aims to amend Title XVIII of the Social Security Act, focusing on improving prompt payment requirements for Medicare Advantage organizations. It mandates that these organizations must provide prompt payment for at least 95% of clean claims submitted by healthcare providers, regardless of whether the provider is in-network or out-of-network. The bill sets specific deadlines for claim payments: 14 days for electronic claims from contracted providers and 30 days for all other claims.
Expected Effects
The Act will likely lead to faster payments to healthcare providers by Medicare Advantage organizations. This could reduce administrative burdens and improve cash flow for providers. The bill also introduces penalties for non-compliance, including interest payments on late claims and potential civil money penalties for organizations that fail to meet the prompt payment requirements.
Potential Benefits
- Improved cash flow for healthcare providers due to faster payments.
- Reduced administrative burden for providers, as prompt payment reduces follow-up efforts.
- Increased transparency and accountability from Medicare Advantage organizations regarding payment practices.
- Potential reduction in healthcare costs due to decreased administrative overhead for providers.
- Standardized claim processing and payment timelines, promoting efficiency.
Most Benefited Areas:
Potential Disadvantages
- Potential for increased administrative costs for Medicare Advantage organizations to comply with the new requirements.
- Possible disputes over what constitutes a 'clean claim,' leading to delays in payment.
- Risk that some organizations may prioritize electronic claims from contracted providers over others.
- The $25,000 penalty may not be a sufficient deterrent for larger organizations.
- The act may lead to higher premiums for Medicare Advantage plans if organizations pass on compliance costs to consumers.
Constitutional Alignment
The Medicare Advantage Prompt Pay Act falls under the purview of Congress's power to legislate on matters related to healthcare and the general welfare, as outlined in Article I, Section 8 of the US Constitution. Specifically, it relates to the provision of healthcare services under Medicare, a federal program established by Congress. The Act does not appear to infringe upon any specific constitutional rights or limitations.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).