AN ACT CONCERNING RETURN OF HEALTH CARE PROVIDER PAYMENTS.

Senate
SB341 / File No. 209 1

General Assembly File No. 209
February Session, 2026 Senate Bill No. 341

Senate, March 26, 2026

The Committee on Insurance and Real Estate reported through
SEN. CABRERA of the 17th Dist., Chairperson of the
Committee on the part of the Senate, that the bill ought to pass.

AN ACT CONCERNING RETURN OF HEALTH CARE PROVIDER
PAYMENTS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:

Section 1. Subsection (c) of section 38a-479b of the general statutes is 1
repealed and the following is substituted in lieu thereof (Effective January 2
1, 2027): 3
(c) (1) No contracting health organization shall cancel, deny or 4
demand the return of full or partial payment for an authorized covered 5
service due to administrative or eligibility error, more than [eighteen] 6
twelve months after the date of the receipt of a clean claim, except if: 7
(A) Such organization has a documented basis to believe that such 8
claim was submitted fraudulently by such provider; 9
(B) The provider did not bill appropriately for such claim based on 10
the documentation or evidence of what medical service was actually 11
provided; 12
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(C) Such organization has paid the provider for such claim more than 13
once; 14
(D) Such organization paid a claim that should have been or was paid 15
by a federal or state program; or 16
(E) The provider received payment for such claim from a different 17
insurer, payor or administrator through coordination of benefits or 18
subrogation, or due to coverage under an automobile insurance or 19
workers' compensation policy. Such provider shall have one year after 20
the date of the cancellation, denial or return of full or partial payment to 21
resubmit an adjusted secondary payor claim with such organization on 22
a secondary payor basis, regardless of such organization's timely filing 23
requirements. 24
(2) (A) Such organization shall give at least thirty days' advance 25
notice to a provider by certified mail, return receipt requested, electronic 26
mail to such electronic mail address designated by such provider or 27
facsimile of the organization's cancellation, denial or demand for the 28
return of full or partial payment pursuant to subdivision (1) of this 29
subsection. 30
(B) If such organization demands the return of full or partial payment 31
from a provider, the notice required under subparagraph (A) of this 32
subdivision shall disclose to the provider (i) the amount that is 33
demanded to be returned, (ii) the claim that is the subject of such 34
demand, and (iii) the basis on which such return is being demanded. 35
(C) Not later than thirty days after the receipt of the notice required 36
under subparagraph (A) of this subdivision, a provider may appeal such 37
cancellation, denial or demand in accordance with the procedures 38
provided by such organization. If any such organization fails to notify 39
the provider of such organization's determination on such appeal not 40
later than fifteen business days after receipt of such appeal from such 41
provider, such appeal shall be construed in favor of such provider. Any 42
demand for the return of full or partial payment shall be stayed during 43
the pendency of such appeal. 44
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(D) If there is no appeal or an appeal is denied, such provider may 45
resubmit an adjusted claim, if applicable, to such organization, not later 46
than thirty days after the receipt of the notice required under 47
subparagraph (A) of this subdivision or the denial of the appeal, 48
whichever is applicable, except that if a return of payment was 49
demanded pursuant to subparagraph (C) of subdivision (1) of this 50
subsection, such claim shall not be resubmitted. 51
(E) A provider shall have one year after the date of the written notice 52
set forth in subparagraph (A) of this subdivision to identify any other 53
appropriate insurance coverage applicable on the date of service and to 54
file a claim with such insurer, health care center or other issuing entity, 55
regardless of such insurer's, health care center's or other issuing entity's 56
timely filing requirements. 57
This act shall take effect as follows and shall amend the following
sections:

Section 1 January 1, 2027 38a-479b(c)

INS Joint Favorable

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The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of
the General Assembly, solely for purposes of information, summarization and explanation and do not
represent the intent of the General Assembly or either chamber thereof for any purpose. In general,
fiscal impacts are based upon a variety of informational sources, including the analyst’s professional
knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final
products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note

State Impact: None
Municipal Impact: None
Explanation
The bill shortens the period in which a health carrier can demand
return of payment from a health care provider due to error and results
in no fiscal impact to the state.

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OLR Bill Analysis
SB 341

AN ACT CONCERNING RETURN OF HEALTH CARE PROVIDER
PAYMENTS.

SUMMARY
This bill makes various changes to laws on claim payments and
appeals between contracting he alth organizations (managed care
organizations and preferred provider networks) and health care
providers (for example, physicians).
Specifically, the bill:
1. reduces, from 18 months to 12 months, the time period after
receiving a clean (complete and error -free) claim by which a
contracting health organization may generally cancel, deny, or
demand full or partial return of payment from a health care
provider for an administrative or eligibility error;
2. specifies that for the existing requirement to give providers 30
days minimum advance notice of a payment cancellation, denial,
or demand , notice must be sent (a) by certified mail, return
receipt requested, if sent by mail or (b) to an email address the
provider designates, if sent by email; and
3. requires the organization to notify the provider of its appeal
determination within 15 business days after receiving the
provider’s appeal, or else the appeal must be construed in the
provider’s favor.
EFFECTIVE DATE: January 1, 2027

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PAYMENT CANCELLATION, DENIAL, OR RETURN
Time Limit
Current law generally prohibits a contracting health organization
from canceling, denying, or demanding the return of full or partial
payment for an authorized covered service due to administrative or
eligibility error, more than 18 months after receiving the claim. The bill
reduces this to 12 months after receiving the clean claim.
Under existing law, unchanged by the bill, the time limit does not
apply if the:
1. organization (a) has a documented basis to believe that the
provider fraudulently submitted the claim, (b) already paid the
provider for the claim, or (c) paid a claim that should have been
or was paid by a federal or state program; or
2. provider (a) did not bill the claim appropriately based on
documentation or evidence of what medical service was
provided or (b) received payment from a different insurer, payor,
or administrator through coordination of benefits, subrogation,
or coverage under an automobile insurance or workers ’
compensation policy.
Advance Notice
Under existing law, an organization must give a provider at least 30
days’ advance notice of a payment cancellation, denial, or return
demand by mail, e-mail, or fax. The bill specifies that if the notice is sent
by mail, it must be sent by certified mail, return receipt requested ; and
if it is sent by email, it must be sent to the provider’s designated email.
Appeal
By law, a provider may appeal, following the organization ’s
procedures, a payment cancellation, denial, or return demand within 30
days after receiving notice of it. The bill requires the organization to
notify the provider of the appeal determination within 15 days after
receiving the appeal. Under the bill, if the organization fails to do so ,
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then the appeal must be construed in the provider’s favor.
Existing law, unchanged by the bill, requires a payment return
demand to be stayed (postponed) during the appeal.
BACKGROUND
Related Bill
sHB 5377 , favorably reported by the Insurance and Real Estate
Committee, has similar provisions . It (1) reduces the period to cancel,
deny, or demand payment on a clean claim from 18 mon ths to 15
months; (2) has an identical provision on the mail and email
requirements; and (3) requires the organization to communicate its
appeal determination to the provider within 12 days of receiving the
appeal.
COMMITTEE ACTION
Insurance and Real Estate Committee
Joint Favorable
Yea 13 Nay 0 (03/12/2026)