Read the full stored bill text
EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*hb0739*
HOUSE BILL 739
J5, J4 6lr2039
By: Delegate Martinez
Introduced and read first time: February 3, 2026
Assigned to: Health
A BILL ENTITLED
AN ACT concerning 1
Health Insurance – Prompt Payment of Claims – Requirements 2
FOR the purpose of requiring insurers, nonprofit health service plans, and health 3
maintenance organizations to send certain notices in a certain manner; requiring 4
that certain refusals to reimburse by insurers, nonprofit health service plans, and 5
health maintenance organizations be considered denial s of all or part of certain 6
claims; requiring insurers, nonprofit health service plans, and health maintenance 7
organizations to pay or refuse to reimburse all or part of certain claim s if certain 8
information is not provided within a certain number of days; and generally relating 9
to prompt payment requirements for health insurance claims. 10
BY repealing and reenacting, with amendments, 11
Article – Insurance 12
Section 15–1005 13
Annotated Code of Maryland 14
(2017 Replacement Volume and 2025 Supplement) 15
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 16
That the Laws of Maryland read as follows: 17
Article – Insurance 18
15–1005. 19
(a) In this section, “clean claim” means a claim for reimbursement, as defined in 20
regulations adopted by the Commissioner under § 15–1003 of this subtitle. 21
(b) To the extent consistent with the Employee Retirement Income Security Act 22
of 1974 (ERISA), 29 U.S.C. 1001 et seq., this section applies to an insurer, nonprofit health 23
service plan, or health maintenance organization that acts as a third party administrator. 24
2 HOUSE BILL 739
(c) Except as provided in § 15 –1315 of this title and subsection [(i)] (J) of this 1
section, within 30 days after receipt of a claim for reimbursement from a person entitled to 2
reimbursement under § 15–701(a) of this title or from a hospital or related institution, as 3
those terms are defined in § 19 –301 of the Health – General Article, an insurer, nonprofit 4
health service plan, or health maintenance organization shall: 5
(1) mail or otherwise transmit payment for the claim in accordance with 6
this section; or 7
(2) [send] MAIL OR E–MAIL a notice of receipt and status of the claim that 8
states: 9
(i) that the insurer, nonprofit health service plan, or health 10
maintenance organization refuses to reimburse all or part of the claim and the reason for 11
the refusal; 12
(ii) that, in accordance with § 15 –1003(d)(1)(ii) of this subtitle, the 13
legitimacy of the claim or the appropriate amount of reimbursement is in dispute and 14
additional information is necessary to determine if all or part of the claim will be 15
reimbursed and what specific additional information is necessary; or 16
(iii) that the claim is not clean and the specific additional information 17
necessary for the claim to be considered a clean claim. 18
(D) A REFUSAL TO REIMBURSE ALL OR PART OF A CLAIM FOR 19
REIMBURSEMENT UNDER SUBSECTION (C)(2)(I) OF THIS SECTION SHAL L BE 20
CONSIDERED A DENIAL OF ALL OR PART OF THE CLAIM. 21
[(d)] (E) (1) (i) In this subsection, “credit card” means a credit, debit, 22
prepaid, or stored–value card used to make a payment through a private card network. 23
(ii) “Credit card” includes a method of payment to a provider where 24
no physical card is presented. 25
(2) An insurer, a nonprofit health service plan, or a health maintenance 26
organization may pay a claim under subsection (c) of this section, o r a portion of a claim 27
under subsection [(f)] (G) of this section, using a credit card or an electronic funds transfer 28
payment method that imposes on the provider a fee or similar charge to process the 29
payment if: 30
(i) the insurer, nonprofit health service plan, or health maintenance 31
organization notifies the provider in advance of the payment that: 32
1. a fee or similar charge associated with the use of the credit 33
card or electronic funds transfer payment method will apply; and 34
HOUSE BILL 739 3
2. the provider will need to consult the provider’s merchant 1
processor or financial institution for the specific rates; 2
(ii) the insurer, nonprofit health service plan, or health maintenance 3
organization offers the provider an alternative payment method that does not impose a fee 4
or similar charge on the provider; and 5
(iii) the provider or the provider’s designee elects to accept payment 6
of the claim or a portion of the claim using the credit card or electronic funds transfer 7
payment method. 8
(3) If a provider participates on a provider panel of an insurer, a nonprofit 9
health service plan, or a health maintenance organization, the acceptance by the provider 10
or the provider’s designee of a payment method offered under paragraph (2)(ii) of this 11
subsection or elected under paragraph (2)(iii) of this subsection shall apply to all claims 12
paid for by the insurer, nonprofit health service plan, or health maintenance organization 13
unless otherwise notified by the provider or the provider’s designee. 14
[(e)] (F) (1) An insurer, nonprofit health service plan, or health maintenance 15
organization shall permit a provider a minimum of 180 days from the date a covered service 16
is rendered to submit a claim for reimbursement for the service. 17
(2) If an insurer, nonprofit health servi ce plan, or health maintenance 18
organization wholly or partially denies a claim for reimbursement, the insurer, nonprofit 19
health service plan, or health maintenance organization shall permit a provider a minimum 20
of 90 working days after the date of denial of the claim to appeal the denial. 21
(3) If an insurer, nonprofit health service plan, or health maintenance 22
organization erroneously denies a provider’s claim for reimbursement submitted within the 23
time period specified in paragraph (1) of this subsection because of a claims processing 24
error, and the provider notifies the insurer, nonprofit health service plan, or health 25
maintenance organization of the potential error within 1 year of the claim denial, the 26
insurer, nonprofit health service plan, or health maintenance organization, on discovery of 27
the error, shall reprocess the provider’s claim without the necessity for the provider to 28
resubmit the claim, and without regard to timely submission deadlines. 29
[(f)] (G) (1) If an insurer, nonprofit health servi ce plan, or health 30
maintenance organization provides notice under subsection (c)(2)(i) of this section, the 31
insurer, nonprofit health service plan, or health maintenance organization shall mail or 32
otherwise transmit payment for any undisputed portion of th e claim within 30 days of 33
receipt of the claim, in accordance with this section. 34
(2) If an insurer, nonprofit health service plan, or health maintenance 35
organization provides notice under subsection (c)(2)(ii) of this section, the insurer, nonprofit 36
health service plan, or health maintenance organization shall: 37
4 HOUSE BILL 739
(i) 1. mail or otherwise transmit payment for any undisputed 1
portion of the claim in accordance with this section; and 2
[(ii)] 2. comply with subsection (c)(1) or (2)(i) of this section within 3
30 days after receipt of the requested additional information; OR 4
(II) IF THE PROVIDER DOES NOT SEND THE REQUESTED 5
ADDITIONAL INFORMATION WITHIN 30 DAYS, COMPLY WITH SUBSECTION (C)(1) OR 6
(2)(I) OF THIS SECTION. 7
(3) If an insurer, nonprofit health service plan, or health maintenance 8
organization provides notice under subsection (c)(2)(iii) of this section, the insurer, 9
nonprofit health service plan, or health maintenance organization shall: 10
(I) comply with subsection (c)(1) or (2)(i) of t his section within 30 11
days after receipt of the requested additional information; OR 12
(II) IF THE PROVIDER DOES NOT SEND THE REQUESTED 13
ADDITIONAL INFORMATION WITHIN 30 DAYS, COMPLY WITH SUBSECTION (C)(1) OR 14
(2)(I) OF THIS SECTION. 15
[(g)] (H) (1) If an insurer, nonprofit health service plan, or health 16
maintenance organization fails to pay a clean claim for reimbursement or otherwise 17
violates any provision of this section, the insurer, nonprofit health service plan, or health 18
maintenance organization shal l pay interest on the amount of the claim that remains 19
unpaid 30 days after receipt of the initial clean claim for reimbursement at the monthly 20
rate of: 21
(i) 1.5% from the 31st day through the 60th day; 22
(ii) 2% from the 61st day through the 120th day; and 23
(iii) 2.5% after the 120th day. 24
(2) The interest paid under this subsection shall be included in any late 25
reimbursement without the necessity for the person that filed the original claim to make 26
an additional claim for that interest. 27
[(h)] (I) An insurer, nonprofit health service plan, or health maintenance 28
organization that violates a provision of this section is subject to: 29
(1) a fine not exceeding $500 for each violation that is arbitrary and 30
capricious, based on all available information; and 31
(2) the penalties prescribed under § 4 –113(d) of this article for violations 32
committed with a frequency that indicates a general business practice. 33
HOUSE BILL 739 5
[(i)] (J) (1) An insurer, a nonprofit health service plan, or a health 1
maintenance org anization may suspend review of a claim for reimbursement for a 2
preauthorized or approved health care service if the insurer, nonprofit health service plan, 3
or health maintenance organization sends written notice within 30 days after receipt of the 4
claim that informs the person filing the claim, that: 5
(i) review of the claim is suspended during the second or third 6
month of a grace period under 45 C.F.R. § 156.270(d); and 7
(ii) on receipt of the payment of premium, the insurer, nonprofit 8
health servic e plan, or health maintenance organization is required to comply with 9
paragraph (2) of this subsection. 10
(2) Within 30 days after receipt of the payment of premium, an insurer, a 11
nonprofit health service plan, or a health maintenance organization shall comply with 12
subsection (c)(1) or (2) of this section. 13
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 14
October 1, 2026. 15