Prompt Pay Penalties for Failure to Comply

Insurance companies have a responsibility to fairly pay medical service providers for their work in a timely manner. Unfortunately, far too many insurers do whatever they can to delay or deny the payments that medical professionals may be owed. In light of this fact, Texas passed the Texas Prompt Pay Act in 2003 in order to provide medical service providers with the ability to pursue the compensation they deserve under the full force of the law. Under this law, insurance companies can be penalized for failing to properly compensate medical providers.

When an insurer fails to provide a physician or other medical professional with appropriate compensation in a timely manner, they may be held financially accountable for their conduct. If you are a medical service provider and you have encountered problems with insurance company payments in Texas, our team at Williams Kherkher understands how frustrating it can be to try to resolve these issues on your own, and we make it our goal to get physicians the compensation they are seeking as quickly as possible.

Prompt Pay Compliance Failure Penalties

When an insurer violates the law and fails to provide medical professionals with the payment they deserve in a timely manner, they may face a range of penalties, depending on how long the delay in payment lasts. If an insurance company fails to compensate a physician on time for any of the contracted amount for services rendered (30 days for electronically submitted claims, 45 days for non-electronically submitted claims), the following penalties apply:

  • If paid between 1 and 45 days late, the insurance company must pay the full contracted rate, half of the difference between the contracted rate and the billed charge, and reasonable and necessary attorneys’ fees.
  • If paid between 46 and 90 days late, the insurance company must pay the full contracted rate, 100% of the difference between the contracted rate and the billed charge, and reasonable and necessary attorneys’ fees.
  • If paid more than 90 days late, the insurance company must pay the full contracted rate as well as 100% of the difference between the contracted rate and the billed charge, reasonable and necessary attorneys’ fees, and 18% annual interest on the penalty amount.

If an insurance company underpays a physician on the contracted amount for services rendered, the penalties are computed using a much more complex formula. An attorney can help you better understand what you may be owed in these circumstances.

Learn More about Prompt Pay Penalties from a Lawyer in Texas

If you have been unfairly denied compensation for medical services or your compensation has been unnecessarily delayed, you may be eligible to take legal action in order to recover what you are owed. At Williams Kherkher, we have experience helping medical professionals in this situation and are ready to help you fight for the compensation you should have been paid. Call a Prompt Pay attorney at (888) 220-0640 today to speak with an experienced legal professional about your case.

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