Interest rate applicable to unpaid claims 45 days after required proof of loss has been furnished

SUPERINTENDENT OF INSURANCE John G. Franchini 505-827-4299 NEW MEXICO OFFICE OF SUPERINTENDENT OF INSURANCE DEPUTY SUPERINTENDENT Robert Doucette 505-827-5832 Bulletin 2017-001 February 16, 2017 TO: INSURANCE COMPANIES AUTHORIZED TO TRANSACT BUSINESS OF INSURANCE IN NEW MEXICO FROM: JOHN G. FRANCHINI, SUPERINTENDENT OF INSURANCE DATE: FEBRUARY 16, 2017 RE: INTEREST RATE APPLICABLE TO UNPAID CLAIMS 45 DAYS AFTER REQUIRED PROOF OF LOSS HAS BEEN FURNISHED THE FOLLOWING BULLETIN is issued pursuant to NMSA 1978, 59A-2-8 of the New Mexico Insurance Code, and NMAC 13.1.2.8 et seq. New Mexico Statutes Annotated NMSA 1978, Section 59A-16-21(B) provides that: 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. Additionally, the New Mexico Administrative Code at 13.10.22.12 (O) provides that: Each contract shall provide that a MHCP failing to pay a health care professional or failing to pay a covered person for out of pocket covered expenses within forty-five 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 Main Phone: 505-827-4601 Main Fax: 505-827-4734 Toll Free: 1-855-4-ASK-OSI Mailing Address: P.O. Box 1689 Santa Fe, NM 87504-1689 Physical Address: 1120 Paseo de Peralta Santa Fe, NM 87501 Website: WWW.OSI.STATE.NM.US est 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 Main Phone: 505-827-4601 Main Fax: 505-827-4734 Toll Free: 1-855-4-ASK-OSI Mailing Address: P.O. Box 1689 Santa Fe, NM 87504-1689 Physical Address: 1120 Paseo de Peralta Santa Fe, NM 87501 Website: WWW.OSI.STATE.NM.US of this section, "clean claim" means a manually or electronically submitted claim that contains all the required data elements necessary for 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. For the year 2017 the interest rate is set as one and one-half times 3.75%, which is equivalent to 5.625%. This interest rate shall remain in effect until the Superintendent completes a review of the interest rate in January 2018 and issues a new bulletin. Please direct your questions regarding this bulletin to Kathi Padilla at (505) 827-3811, or via e-mail at Kathi.Padilla@state.nm.us. DONE and ORDERED on February 16, 2017. JOHN G. FRANCHINI Superintendent of Insurance Main Phone: 505-827-4601 Main Fax: 505-827-4734 Toll Free: 1-855-4-ASK-OSI Mailing Address: P.O. Box 1689 Santa Fe, NM 87504-1689 Physical Address: 1120 Paseo de Peralta Santa Fe, NM 87501 Website: WWW.OSI.STATE.NM.US