Review of Providence Health Plans' Compliance With Medicare+Choice Prompt Payment Regulations During The Period September 1, 2002 Through February 28, 2003

EXECUTIVE SUMMARY:

The objective of this review was to determine whether Providence Health Plans (Providence) complied with Medicare+Choice prompt payment regulations to timely pay or deny claims submitted by noncontracted providers during the period September 1, 2002 through February 28, 2003.  We found that Providence did not comply with prompt payment regulations.  Specifically, Providence did not (1) pay at least 95 percent of clean claims within 30 days of receipt, (2) calculate and pay interest on clean claims not paid within 30 days, and (3) pay or deny all claims within 60 days of receipt.  These conditions occurred because Providence did not implement adequate procedures to (1) pay or deny claims in a timely manner and (2) process resubmitted claims.  We recommended procedural improvements to ensure that  at least 95 percent of clean claims are paid within 30 days of receipt, interest is calculated and paid on clean claims not paid within 30 days, and  all claims are paid or denied within 60 days of receipt.  Providence concurred with our findings.