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HB2581 - 572R - I Ver
REFERENCE TITLE:
health insurance claims; consumer assistance
State of Arizona
House of Representatives
Fifty-seventh Legislature
Second Regular Session
2026
HB 2581
Introduced by
Representatives
Simacek: Aguilar, Blattman, Cavero, Connolly, Contreras P, Crews, De Los
Santos, Garcia, Gutierrez, Liguori, M�rquez, Sandoval, Stahl Hamilton,
Travers, Volk;� Senator Gonzales
AN
ACT
amending title 20, chapter 1, article 1,
Arizona Revised Statutes, by adding section 20-128; appropriating monies;
relating to the department of insurance and financial institutions.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 20, chapter 1, article 1,
Arizona Revised Statutes, is amended by adding section 20-128, to read:
START_STATUTE
20-128.
Health care claims consumer assistance program; civil penalty;
data collection; reporting requirements; public posting; rules; definitions
A. A health care claims consumer
assistance program is established in the department to provide support to
consumers who are enrolled in a health plan or who are seeking to enroll in a
health plan.
B. The health care claims consumer
assistance program shall:
1. Assist consumers with filing
complaints and appeals with a health insurer or with the utilization review
process as provided in chapter 15 of this title.
2. Assist consumers with settling
conflicts, disputed claims or claims denials with a health insurer.
3. Educate consumers on their rights
and responsibilities with respect to health insurance coverage.
c. The department may impose civil
penalties if the department finds that a health insurer continuously violates a
health plan.� If the department provides proper notice and an opportunity to
the health insurer to remedy repeated violations and the health insurer
continues to violate a health plan, the department may impose a civil penalty
of at least $25,000 for each violation for which the health insurer wrongfully
denied or insufficiently paid a valid consumer insurance claim.
d. If the department or a court finds
that a health insurer has wrongfully denied or insufficiently covered a valid
consumer insurance claim, the health insurer is automatically liable to pay
double the amount that was wrongfully denied or insufficiently covered,
including attorney fees.
e. The department or the court may
assess additional damages to be paid to an insured on review of the following
factors, as appropriate, if the harm was severe:
1. The nature, scope and gravity of
the violation.
2. The severity of the potential harm
to the policyholder, including:
(
a
) Loss of
life.
(
b
) Loss of
health.
(
c
) Emotional
distress.
(
d
) Financial
harm.
3. The nature and extent to which the
health insurer cooperated with the department.
4. The nature and extent to which the
health insurer aggravated or mitigated any injury or damaged caused by the
violation.
5. The nature and extent to which the
health insurer has taken corrective action to ensure the violation will not
recur.
f. On or before December 31, 2026 and
every year thereafter, the department shall adjust the penalty amount
prescribed in subsection c of this section based on whichever is the higher of:
1. The average rate of change in
premium rates for insureds in a group market that is weighted by enrollment
since the previous adjustment.
2. Any adjustment based on inflation.
g. The department shall keep records
of wrongful claims denials that are brought to the health care claims consumer
assistance program.
h. A health insurer shall disclose
data on wrongful claims denials to the department on request and in a readable
format that includes:
1. The number, percentage and types
of denied claims.
2. The number, percentage and types
of wrongfully denied claims.
i. If a health insurer is found to
have violated this section more than the median percentage of wrongful denials
since the previous year, the department shall review each violation in the
current year to determine whether penalties should be imposed.
J. on or before May 1, 2027 and every
year thereafter, the department shall:
1. Compile a report that contains all
of the following:
(
a
) The number
and type of denied claims, including raw numbers and numbers as a percentage of
the total claims.
(
b
) The number
and type of wrongfully denied claims, including raw numbers and numbers as a
percentage of the total claims.
(
c
) The number
and type of denied claims that were appealed and reported to the health care
claims consumer assistance program.
(
d
) The number
of denied claims that were appealed and brought to the health care claims
consumer assistance program.
(
e
) the number,
type and percentage of wrongfully denied claims by each insurer for each health
plan.
(
f
) The outcome
of any investigation for each health insurer that was conducted by the
department for a violation of this section.
2. Post the report on the
department's publicly accessible website and provide a copy to:
(
a
) The
governor's office.
(
b
) The
president of the senate.
(
c
) The speaker
of the house of representatives.
(
d
) The
minority leader in the senate.
(
e
) The
minority leader in the house of representatives.
(
f
) The
secretary of state.
K. The department shall adopt rules
to implement this section.
L. For the purposes of this section:
1. "Consumer" means
customers or potential customers of a health plan.
2. "Enrolled" means an
individual or person who is under a health care plan.
3. "Health care plan" means
any contract for coverage between an insured and a health plan, including:
(
a
) A
subscription contract.
(
b
) An evidence
of coverage.
(
c
) A policy.
4. "Insured" means any
individual or person who has an active health care plan.
5. "Insurer" means any of
the following:
(
a
) A hospital
service corporation or medical service corporation.
(
b
) A health
care services organization.
(
c
) A
disability insurer.
(
d
) A group or
blanket disability insurer.
END_STATUTE
Sec. 2.
Appropriation;
department of insurance and financial institutions; exemption
A. The sum of $250,000 is
appropriated from the state general fund in fiscal year 2026-2027 to the
department of insurance and financial institutions for the purposes of the
health care claims consumer assistance program.
B. The appropriation made
in subsection A of this section is exempt from the provisions of section
35-190, Arizona Revised Statutes, relating to lapsing of appropriations.