Bill

Bill > A1036


NJ A1036

Prohibits downcoding in health insurance claims.


summary

Introduced
01/09/2024
In Committee
01/09/2024
Crossed Over
Passed
Dead

Introduced Session

2024-2025 Regular Session

Bill Summary

This bill prohibits a health insurance claims payer from using downcoding in a manner that prevents a health care provider from submitting a health benefits claim for the actual service performed and collecting reimbursement from the payer for that service. The bill applies to health insurance carriers, organized delivery systems, or any agents of a health insurance carrier or organized delivery system doing business in New Jersey. Downcoding refers to the practice of adjusting health benefits claims submitted to a payer to a less complex or lower cost service than the service actually performed so the payer can reimburse a lower amount to the health care provider that submitted the claim. Downcoding may occur where a payer disputes a specific service or contends that the diagnosis did not require the specific service code submitted by the health care provider. Excessive or routine downcoding can significantly reduce revenue for health care providers. Health care providers are already subject to robust State laws concerning fraud relating to health benefits claims. These laws, including the "New Jersey False Claims Act," the "New Jersey Health Care Claims Fraud Act," and the "New Jersey Insurance Fraud Prevention Act," penalize health care providers that submit fraudulent claims to a payer.

AI Summary

This bill prohibits health insurance claims payers from using the practice of "downcoding" to prevent healthcare providers from submitting claims for the actual services performed and collecting the appropriate reimbursement. Downcoding refers to adjusting a claim to a less complex or lower cost service, resulting in the provider receiving a lower payment. The bill applies to all health insurance carriers, organized delivery systems, and their agents doing business in New Jersey. It requires the Department of Banking and Insurance to adopt regulations to enforce the law, which will take effect 180 days after enactment.

Committee Categories

Business and Industry

Sponsors (1)

Last Action

Introduced, Referred to Assembly Financial Institutions and Insurance Committee (on 01/09/2024)

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