INTEREST RATE APPLICABLE TO UNPAID CLAIMS 45 DAYS AFTER REQUIRED PROOF OF LOSS HAS BEEN FURNISHED

STATE OF NEW MEXICO OFFICE OF SUPERINTENDENT OF INSURANCE SUPERINTENDENT OF INSURANCE Russell Toal DEPUTY SUPERINTENDENT Robert E. Doucette, Jr. Main Office: 1120 Paseo de Peralta, Room 428, Santa Fe, NM 87501 Satellite Office: 6200 Uptown Blvd NE, Suite 100, Albuquerque, NM 87110 Main Phone: (505) 827-4601 | Satellite Phone: (505) 322-2186 | Toll Free: (855) 4 - ASK - OSI www.osi.state.nm.us BULLETIN 2021-001 JANUARY 12, 2021 This Bulletin supersedes and replaces Bulletin 2019-017. TO: INSURANCE COMPANIES AUTHORIZED TO TRANSACT THE BUSINESS OF INSURANCE IN NEW MEXICO RE: INTEREST RATE APPLICABLE TO UNPAID CLAIMS 45 DAYS AFTER REQUIRED PROOF OF LOSS HAS BEEN FURNISHED THIS BULLETIN is issued pursuant to NMSA 1978, § 59A-2-8 and 13.1.2.8 NMAC, et seq. The New Mexico Insurance Code, at NMSA 1978, § 59A-16-21(B), provides: Notwithstanding any provision of the Insurance Code, any insurer issuing any policy, certificate or contract of insurance, surety, guaranty or indemnity of any kind or nature which fails, for a period of forty-five days, after required proof of loss has been furnished , to pay to the person entitled the amount justly due shall be liable for the amount due and unpaid with interest on that amount at the rate of one and one-half times the prime lending rate as determined by the superintendent, for New Mexico banks per year during the period the claim is unpaid. The New Mexico Administrative Code, at 13.10.22.12(0) NMAC, provides: Each contract shall provide that an MHCP failing to pay a health care professional or failing to pay a covered person for out of pocket covered expenses within fortyfive days after a clean claim has been received by the MHCP shall be liable for the amount due and unpaid with interest on that amount at the rate of one and one half times the rate established by a bulletin entered by the superintendent in January of each calendar year. For the purposes of this section, "clean claim" means amanually or electronically submitted claim that contains all the required data elements necessary for January 12, 2021 8:06 AM B U L L E T I N 2 0 2 1 - 0 _ _ _ P a g e | 2 Main Office: 1120 Paseo de Peralta, Room 428, Santa Fe, NM 87501 Satellite Office: 6200 Uptown Blvd NE, Suite 100, Albuquerque, NM 87110 Main Phone: (505) 827-4601 | Satellite Phone: (505) 322-2186 | Toll Free: (855) 4 - ASK - OSI www.osi.state.nm.us accurate adjudication without the need for additional information from outside of the MHCP's system and contains no deficiency or impropriety, including lack of substantiating documentation currently required by the MHCP, or particular circumstances requiring special treatment that prevents timely payment from being made by the MHCP. On November 24, 2019, the Superintendent issued Bulletin No. 2019-017, having determined that the statutory interest rate on unpaid claims was 7.125%. The current prime lending rate established by the Federal Reserve is 3.25%. Due to the change in the prime lending rate, commencing February 1, 2021, the interest rate applicable to the referenced statute and rule is 4.875%. This rate shall remain in effect until superseded by a subsequent bulletin specifying a different rate. An insurer that owes interest pursuant to the above referenced statute or rule shall use the rate specified in this rate bulletin. The Superintendent intends to publish an interest rate bulletin at least once per year. The Superintendent may publish interest rate bulletins more frequently if the prime lending rate materially fluctuates, or less frequently if the prime lending rate remains stable. Please direct any questions regarding this bulletin to Anna Krylova at (505) 827-4529, or via email at anna.krylova@state.nm.us. ISSUED this 12th day of January, 2021. __________________________________ RUSSELL TOAL SUPERINTENDENT OF INSURANCE