Second Regular Session Sixty-fourth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 04-0267.01 Julie Hoerner HOUSE BILL 04-1008 HOUSE SPONSORSHIP Cloer, SENATE SPONSORSHIP Lamborn, House Committees Senate Committees Business Affairs & Labor A BILL FOR AN ACT Concerning assignment of benefits offered under a motor vehicle insurance policy. Bill Summary (Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments that may be subsequently adopted.) Allows a person who sustains injuries in a motor vehicle accident to assign the payment of the covered benefit to a health care provider. Sets out the requirements of the assignment. Allows the insured person to revoke the assignment. Specifies an insurer's ability to determine whether the claim is within the scope of coverage. Also specifies that an insurer may contract with managed care arrangements for the purposes of a medical payment coverage policy. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Part 6 of article 4 of title 10, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SECTION to read: 10-4-634. Assignment of payment for covered benefits. (1) (a) A policy of motor vehicle insurance coverage pursuant to this part 6 shall allow, but not require, an insured under the policy to assign, in writing, payments due under the policy to a licensed hospital or other licensed health care provider for services provided to the insured that are covered under the policy. (b) The insured may, with or without the agreement of the licensed hospital or other licensed health care provider, revoke the assignment. Such revocation shall be in writing and shall be sent to the insurer by certified mail, return receipt requested. The insurer shall then send a copy of the revocation to the provider who is the subject of the revocation by certified mail, return receipt requested. The revocation shall be effective when it has been received by both the insurer and the provider and shall only affect those charges incurred after such receipt by both. (2) When a licensed hospital or other licensed health care provider receives an assignment from an insured, it is the responsibility of the provider to bill the insurer and notify the insurer that the licensed health care provider holds an assignment on file. The insurer shall honor this assignment the same as if a copy of the assignment had been received by the insurer. Only upon request of the insurer shall the health care provider be required to provide a copy of the assignment. The provider shall also provide a copy of such bill to the insured, stating on such copy that it is for informational purposes only and that the insurer has been billed for covered benefits. The provider shall also furnish to the insurer a current taxpayer identification number as part of the initial bill and each subsequent billing. Subsequent billings to an insurer need not include a copy of the assignment unless required by the insurer so long as it is clearly noted on each such subsequent billing that the benefits have been assigned. The insurer shall honor such assignment and make payment of covered benefits directly to such licensed hospital or other licensed health care provider. If the insurer fails to honor such assignment but instead makes payment to the insured, and if the insured fails to timely pay an amount equivalent to such payment to the licensed hospital or other licensed health care provider, then the insurer shall be liable for such payment directly to the licensed hospital or other licensed health care provider. It shall be the responsibility of the licensed hospital or other licensed health care provider to notify the insurer if timely payment has not been received. In such case, the insurer shall make payment of covered benefits within thirty days after receipt of such notification. (3) (a) Nothing in this section shall be construed to limit an insurer's ability to determine the scope of its benefits or services or any other terms of its policies, nor to negotiate contracts with licensed hospitals or other licensed health care providers on reimbursement rates or any other lawful provisions. (b) Notwithstanding the provisions of subsection (2) of this section, a licensed hospital or other licensed health care provider shall not be entitled to payment greater than the lesser of its customary charge for such service or the level of reimbursement previously negotiated with the insurer, if applicable; nor shall the insurer have any obligation under this section except for covered benefits. (4) Nothing in this section shall be construed to prevent an insurer from limiting covered benefits to managed care arrangements or to services provided by providers who have contracted with the insurer or from providing different levels of benefits depending on whether the provider has or has not contracted with the insurer. SECTION 2. Applicability. This act shall apply to injuries sustained in a motor vehicle accident on or after the effective date of this act. SECTION 3. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.