Florida law takes on overpayment claims, assignment of benefits

A Florida law that takes effect this fall addresses some of the contracting and payment issues that its supporters said have been upsetting doctors there for years.

The law requires that plans honor a member's assignment of benefits when that member sees an in-network physician, bars insurers from selling network discounts to third parties without a physician's consent, and tells insurers that payments older than 12 months cannot be subject to overpayment claims.

"Before this legislation passed, the scales were tilted way too far in favor of managed care companies," said Sen. Don Gaetz, the bill's sponsor. He is a retired health care administrator from Fort Walton Beach.

Florida Medical Assn. President Steven West, MD, a cardiologist practicing in Fort Myers, said the changes are "huge" for the state's physicians. The new law, signed June 23 by Florida Gov. Charlie Crist, will take effect Nov. 1.

Dr. West said the provision on overpayment claims is likely to have the greatest impact on Florida physicians' finances, including his own.

The 12-month deadline replaces the current 30-month deadline for plans to identify and collect for what it deemed was overpayment of a claim.

"This makes [insurers] have to do it sooner and faster, and it kind of levels the playing field -- we only have six months to submit a claim," Dr. West said.

Meanwhile, Florida will be one of 20 states that address whether health plans must honor a member's assignment of benefits.

The new Florida law requires that plans reimburse in-network doctors directly.

Gaetz said health plans had been paying benefits directly to patients, sometimes as a way to pressure physicians into contracts more favorable to the insurer. Dr. West said this has happened in his practice.

Dr. West said the FMA would like to expand that new rule to apply in cases where a patient assigns benefits to a physician out of network. But he said the new law covering in-network physicians "was the first small step on solving the problem of assignment of benefits."

The law also bars health plans from selling network discounts to third parties without doctors' consent. That is a practice physicians call silent PPOs, because doctors don't learn their name has been rented out to another PPO's network until they see an explanation of benefits form. Often, the silent PPO pays less.

Michael Garner, PhD, president and CEO of the Florida Assn. of Health Plans, said the new law could pose some problems for members. But he said it's too soon to know whether those will materialize.