This title constitutes the Alabama Insurance Code.
(a) The Legislature finds and declares the following:
(1) The citizens of this state rely upon health insurance to cover the cost of obtaining health care and it is essential that the citizens' expectation that their health care costs will be paid by their insurance policies is not disappointed and that they obtain the coverage necessary and appropriate for their care within the terms of their insurance policies.
(2) Some insurers deny payment for drugs that have been approved by the Federal Food and Drug Administration, hereafter referred to as FDA, when the drugs are used for indications other than those stated in the labelling approved by the FDA, off-label use, while other insurers with similar coverage terms do pay for off-label use.
(3) Denial of payment for off-label use can interrupt or effectively deny access to necessary and appropriate treatment for a person being treated for a life-threatening illness.
(4) Equity among employers who obtain insurance coverage for their employees and fair competition among insurance companies require that insurance companies assure citizens reimbursement for drugs in the same way and in the way citizens expect.
(5) Off-label use of an FDA-approved drug is legal when prescribed in a medically appropriate manner and is often necessary to provide needed care. Approximately 50% of cancer drug treatment is for off-label indications. The FDA and the Federal Department of Health and Human Services recognize the wide variety of effective uses of FDA-approved drugs for off-label indications. Information on the appropriate off-label use of FDA-approved drugs is obtained from compendia published by the United States Pharmacopoeial Convention, the American Medical Association, and the American Society of Hospital Pharmacists. In addition, scientific studies of off-label use of drugs published in recognized peer-reviewed professional journals provide information on appropriate use of drugs for off-label indications. The Omnibus Budget Reconciliation Act of 1990 recognizes these three compendia and peer-reviewed literature as appropriate sources for reimbursement and requires Medicaid agencies to pay for off-label use of drugs prescribed for Medicaid patients if the use is stated in any of such sources. The Omnibus Budget Reconciliation Act of 1993 applies the same criteria and coverage to Medicare patients.
(6) Use of FDA-approved drugs for off-label indications provides efficacious drugs at a lower cost. To require that all appropriate uses of a drug undergo approval by the FDA would substantially increase the cost of drugs and delay or even deny patients' ability to obtain medically effective treatment. FDA approval for each use would require substantial expenditure and time to undergo the clinical trials necessary to obtain FDA approval. This is particularly the case when a drug is off-patent and in generic production, and consequently is available at a lower price. Once a drug is in generic production by multiple manufacturers, it is not economically feasible for a manufacturer to incur the cost of FDA approval.
(7) Reimbursement for off-label indications of FDA-approved drugs is necessary to conform to the way in which appropriate medical treatment is provided, to make needed drugs available to patients, and to contain health care costs.
(b) The following words and phrases used in this section shall have the following meanings:
(1) CONTRAINDICATION. The potential for, or the occurrence of, an undesirable alteration of the therapeutic effect of a given prescription because of the presence, in the patient for whom it is prescribed, of a disease condition or the potential for, or the occurrence of, a clinically significant adverse effect of the drug on the patient's disease condition.
(2) INDICATION. Any symptom, cause, or occurrence in a disease which points out its cause, diagnosis, course of treatment, or prognosis.
(3) INSURANCE POLICY. An individual, group, blanket, or franchise insurance policy, insurance agreement, or group hospital service contract providing for hospital, medical, surgical, or pharmaceutical services.
(4) MEDICAL LITERATURE. Published scientific studies published in any peer-reviewed national professional journal.
(5) STANDARD REFERENCE COMPENDIA. Any of the following:
a. The United States Pharmacopeia Drug Information.
b. The American Medical Association Drug Evaluations.
c. The American Hospital Formulary Service Drug Information.
(c)(1) Title 27, or any other provision of law, rule, or regulation to the contrary notwithstanding, it is specifically provided that:
a. No insurance policy which provides coverage for drugs shall exclude coverage of a drug for a particular indication on the ground that the drug has not been approved by the Federal Food and Drug Administration for that indication, if the drug is recognized for treatment of that indication in one of the standard reference compendia, or in the medical literature, or by the Commissioner of Insurance.
b. Coverage of a drug required by this section shall also include medically necessary services associated with the administration of the drug.
(2) This section shall not be construed to alter existing law with regard to provisions limiting the coverage of drugs that have not been approved by the Federal Food and Drug Administration.
(3) This section shall not be construed to require coverage for any drug when the Federal Food and Drug Administration has determined its use to be contraindicated.
(4) This section shall not be construed to require coverage for experimental drugs not otherwise approved for any indication by the Federal Food and Drug Administration.
(5) The Commissioner of Insurance may direct any person who issues an insurance policy to make payments required by this section.
(6) Nothing in this section shall be construed, expressly or by implication, to create, impair, alter, limit, modify, enlarge, abrogate, or prohibit reimbursement for drugs used in the treatment of any other disease or condition.
Any contract or policy of insurance or any plan or agreement for health services providing for reimbursement or payment for health services performed by a medical doctor or physician or upon the certification of a medical doctor, surgeon, osteopath or physician, shall also reimburse or pay for such health services performed by a doctor of chiropractic or upon his certificate; provided, that the health services performed by the doctor of chiropractic are within the scope of his license and he is duly licensed by the state of Alabama.
The insured or such other person entitled to benefits under such contract or policy of insurance or plan or agreement for health services shall have the exclusive right to choose or select any practitioner or member of the healing arts of Alabama to perform such services, notwithstanding any provisions of such contract or policy of insurance or plan or agreement for health services to the contrary.
Any appropriations made by the Legislature of Alabama to the University of Alabama in Birmingham and to the University of South Alabama shall be for the unrestricted support of the activities of the said university and therefore insurance companies, whether operated for profit or not for profit, licensed under the laws of the State of Alabama, whether acting on their own behalf or for others, are prohibited from applying or taking into account in any manner whatsoever, any portion of those appropriations in determining reimbursement for patient care activities.
Whenever the terms 'physician' and/or 'doctor' are used in any policy of health or accident insurance issued in this state or in any contract for the provision of health care, services or benefits issued by any health, medical or other service corporation existing under, and by virtue of any laws of this state, said terms shall include within their meaning those persons licensed under and in accordance with Chapter 9 of Title 34 in respect to any care, services, procedures or benefits covered by said policy of insurance or health care contract which the said persons are licensed to perform, any provisions in any such policy of insurance or health care contract to the contrary notwithstanding. This section shall be applicable to all policies in this state, regardless of date of issue, on October 10, 1975.
Each willful violation of this title for which a greater penalty is not provided by another provision of this title or by other applicable laws of this state shall, in addition to any applicable prescribed denial, suspension or revocation of certificate of authority or license, be punishable as a misdemeanor, upon conviction, by a fine of not more than $1,000.00 or by imprisonment in the county jail, or by sentence to hard labor for the county, for a period not to exceed one year or by both such fine and imprisonment or hard labor in the discretion of the court. Each instance of violation shall be considered a separate offense.
Every form of insurance document and every rate or other filing lawfully in use immediately prior to January 1, 1972, may continue to be so used or be effective until the commissioner otherwise prescribes pursuant to this title.
This title shall not impair or affect any act done, offense committed or right accruing, accrued or acquired or liability, penalty, forfeiture or punishment incurred prior to January 1, 1972, but the same may be enjoyed, asserted, enforced, prosecuted or inflicted, as fully, and to the same extent, as was possible prior to January 1, 1972.
Notwithstanding any other provision of law, when any contract of health insurance or any plan or agreement for health services provides for the reimbursement or payment for services which are within the scope of a podiatrist's professional license as defined in the general laws of Alabama, such policy shall be construed to include payment to a podiatrist who has performed such procedures.
(a)(1) The Commissioner of the Department of Insurance shall prescribe a standard health insurance claim form to be used by all hospitals. The forms shall be prescribed in a format which allows for the use of generally accepted diagnosis and treatment coding systems by providers of health care and payors. The standard form shall be accepted and used by all insurers doing business in the State of Alabama and by all state agencies which pay providers of health care for hospital services.
(2) The Commissioner of the Department of Insurance shall also prescribe a format for all health insurance claims transmitted or submitted for payment by electronic or electro-mechanical means. Such a format shall be used by all insurers doing business in the State of Alabama and by all state agencies which pay providers of health care for hospital services.
(b) An advisory committee of five persons, two appointed by the Alabama Hospital Association, two by the Health Insurance Association of America, and one by an Alabama nonprofit corporation which markets health insurance, shall advise the commissioner on an acceptable standard health insurance claim form and an electronic or electro-mechanical claims form no later than 60 days prior to January 1, 1982. If changes in the forms need to be made at any future time, the Commissioner of the Department of Insurance shall inform the advisory committee and the committee shall make recommendations as to the changes.
(c) All insurers doing business in Alabama and all state agencies shall accept, for services from physicians licensed to practice medicine, the Uniform Health Insurance Claim Form approved by the Council on Medical Service of the American Medical Association. Nothing in this section shall be construed to prohibit an insurer or state agency from accepting any other health insurance claim form for services provided by a physician licensed to practice medicine.
(d) Every third party prescription program serving patients in Alabama shall utilize the Universal Pharmacy Billing Claim form or format used by pharmacists billing for their services. Information required on the universal prescription claim form, either hard copy or electronic, shall be in compliance with the National Council on Pharmaceutical Drug Plan standards. If a provider, due to the location of the pharmacy, cannot comply with electronic claims submission requirements, then the prescription program shall allow the pharmacy to submit claims via hard copy. Pharmacy providers and recipients shall be given at least 45 days advance notice regarding changes in procedures and benefits.
(e) All insurers doing business in Alabama and all state agencies shall accept for services from dentists licensed to practice dentistry, the Uniform Dental Claim form approved by the Council on Dental Care Programs of the American Dental Association. Nothing in this section shall be construed to prohibit an insurer or state agency from accepting any other dental insurance claim form for services provided by a dentist licensed to practice dentistry.
(f) The foregoing provisions shall not apply to the Alabama Medicaid Agency.
(a) Each insurer, health service corporation, and health benefit plan that issues or renews any policy of accident or health insurance providing benefits for medical or hospital expenses for its insured persons shall pay for services rendered by Alabama health care providers within 45 calendar days upon receipt of a clean written claim or 30 calendar days upon receipt of a clean electronic claim. If the insurer, health service corporation, or health benefit plan is denying or pending the claim, the insurer, health service corporation, or health benefit plan shall, within 45 calendar days for a written claim and 30 calendar days for an electronic claim, notify the health care provider or certificate holder of the reason for denying or pending the claim and what, if any, additional information is required to process the claim. Any undisputed portion of the claim shall be paid in accordance with the foregoing schedule. If the insurer, health service corporation, or health benefit plan fails to provide the notice to the health care provider of the reason for denying or pending the claim, then any such claim, if and when determined to be payable, shall accrue interest at the rate as provided herein, from the date such notice should have been given in accordance with this provision. Upon receipt of the necessary information, the claim must be paid, denied, or otherwise adjudicated within 21 calendar days from the receipt of the requested information. The failure of an insurer, health service corporation, or health benefit plan to comply with the time limits in this section shall not have the effect of requiring coverage for an otherwise non-covered claim. This section shall only apply to payments made on a claims basis and shall not apply to capitation or other forms of periodic payment to providers. For the purposes of this section, an insurer, health service corporation, or health benefit plan domiciled outside of the State of Alabama is deemed to be subject to the provisions of this section if it receives, processes, adjudicates, pays, or denies claims for health care services submitted by or on behalf of patients, insureds, or beneficiaries who reside in the State of Alabama or who receive health care services in the State of Alabama.
(b) As used in this section, the following terms shall have the following meanings:
(1) CLEAN ELECTRONIC CLAIM. The transmission of data for purposes of payment of covered health care expenses that is submitted to an insurer, health service corporation, or health benefit plan which contains substantially all of the required data elements necessary for accurate adjudication, without obtaining additional information from the provider of the service or from a third party, in an electronic data format specified by the insurer's, health service corporation's, or health benefit plan's published filing requirements. In no event shall an insurer, health service corporation, or health benefit plan require that the health care provider submit data elements in excess of those required on the standard electronic health insurance claim format designated by Section 27-1-16 as a condition to the acceptance and processing of an initial claim as a clean claim.
(2) CLEAN WRITTEN CLAIM. A claim for payment of covered health care expenses that is submitted to an insurer, health service corporation, or health benefit plan on the claim form of the insurer, health service corporation, or health benefit plan which contains substantially all of the required data elements necessary for accurate adjudication, without obtaining additional information from the provider of the service or from a third party. In no event shall an insurer, health service corporation, or health benefit plan require that the health care provider submit information or data elements in excess of those required on the standard health insurance claim form designated by Section 27-1-16 as a condition to the acceptance and processing of an initial claim as a clean claim.
(3) COORDINATION OF BENEFITS. The determination of the order in which health care insurers, health maintenance organizations, health service corporations, health benefit plans, or government benefit plans are responsible for claims payments, as defined in Alabama Insurance Department Regulation No. 56, or any successor regulation.
(4) FRAUD. The intentional and deliberate misrepresentation of a material fact or facts by a health care provider made to induce the insurer, health service corporation, or health benefit plan to pay a claim that was not legally payable to that provider. The term fraud, as used in this section, shall not include a good faith interpretation by a health care provider of utilization, medical necessity, coding, and billing requirements of the insurer, health service corporation, or health benefit plan, unless subject provider has been sent a notice in writing by the insurer, health service corporation, or health benefit plan that such interpretation is in error.
(5) INSURER, HEALTH SERVICE CORPORATION, and HEALTH BENEFIT PLAN. Include health care insurers, health maintenance organizations, accident and sickness insurers, fraternal benefit societies, nonprofit hospital service corporations, or nonprofit medical service providers that pay for, purchase, or furnish health care services to patients, insureds, or beneficiaries in this state.
(6) NOTICE or NOTIFY. Where the provider files an electronic claim or where the provider has electronic media available, as used herein, the following terms shall mean:
Notice. In addition to all forms of paper notice, includes electronic notice whereby the insurer, health services corporation, or the health benefit plan makes claims status, eligibility, and payment and remittance advice information which is available to the provider via electronic media.
Notify. In addition to all forms of paper notification, includes the posting or updating of an electronic record or data set with the claims status, eligibility, and payment and remittance advice information which is available to the provider via electronic media.
In all other instances, except where the provider has agreed to accept notice by electronic media, notice shall mean written notice delivered or mailed to the provider.
This provision is intended to be and shall be applied in a manner consistent with the standardized transaction and code set requirements for administrative simplification pursuant to the federal Health Insurance Portability and Accountability Act of 1996 ('HIPAA'), Public Law 104-191.
(7) POLICY OF ACCIDENT OR HEALTH INSURANCE. Any individual or group plan, policy, or contract for health care services issued, delivered, issued for delivery, renewed in this state by a health care insurer, health maintenance organization, accident and sickness insurer, fraternal benefit society, nonprofit hospital service corporation, or nonprofit medical service corporation that pays for, purchases, or furnishes health care services to patients, insureds, or beneficiaries in this state.
(c) Any claim which has not been denied with notice, made pending with notice, or paid to the provider by the insurer, health service corporation, or the health benefit plan shall be overdue if the notice or payment is not received by the provider within the time periods specified in subsection (a). No further notice by the provider to the insurer, health service corporation, or health benefit plan shall be required under this section. If the insurer, health service corporation, or health benefit plan fails to deny or pay a clean written claim or clean electronic claim within the time periods, then the following shall occur: The amount of the overdue claim shall include an interest payment of 1.5 percent per month prorated daily which shall accrue from the date the payment was overdue and which shall be payable at the time that the claim is paid.
(d) The following are exceptions to the requirements of this section:
(1) No insurer, health service corporation, or health benefit plan shall be in violation of this section for a claim submitted by a health care provider if any of the following circumstances apply:
a. Failure to comply is caused by a directive from a court or a federal or state agency.
b. The insurer, health service corporation, or health benefit plan is in liquidation or rehabilitation or is operating in compliance with a court-ordered plan of rehabilitation.
c. Compliance by the insurer, health service corporation, or health benefit plan is rendered impossible due to matters beyond its control which were not caused by such insurer, health service corporation, or health benefit plan or caused by any third party vendor, agent, or contracting party furnishing services to the insurer, health service corporation, or health benefit plan which are related directly or indirectly to the processing of claims by such insurer, health service corporation, or health benefit plan.
(2) No insurer, health service corporation, or health benefit plan shall be in violation of this section for any claim submitted more than 180 days after the service was rendered.
(3) No insurer, health service corporation, or health benefit plan shall be in violation of this section while the claim is pending due to a fraud investigation that has been reported to a state or federal agency, or an external review process.
(e) An insurer, health service corporation, and health benefit plan shall not retroactively deny, adjust, or seek recoupment or refund of a paid claim for health care expenses submitted by a health care provider for any reason, other than fraud or coordination of benefits or for duplicate payments on claims received from the same insurer, health service corporation, or health benefit plan for the same service, after the expiration of one year from the date that the initial claim was paid or after the expiration of the same period of time that the health care provider is required to submit claims pursuant to a contract between the health care provider and an insurer, health service corporation, or health benefit plan, whichever date occurs first. Retroactive denials, adjustments, recoupments, or refunds based on coordination of benefits shall be governed by subsection (f). Notwithstanding any other provision of law or contract to the contrary, if an insurer, health service corporation, or health benefit plan retroactively denies, adjusts, or seeks recoupment or refund of a paid claim, the health care provider shall have an additional period of six months from the date that the notice required by subsection (g) was received within which to file either a revised claim or a request for reconsideration with additional medical records or information, and the insurer, health service corporation, or health benefit plan shall process the revised claim or request for reconsideration in accordance with the requirements of subsections (a), (b), and (c), or in accordance with U.S. Department of Labor regulations governing the resolution of claims disputes and time for appeals, if applicable.
(f) An insurer, health service corporation, or health benefit plan shall not retroactively deny, adjust, or seek recoupment or refund of a paid claim submitted by a health care provider for reasons related to coordination of benefits with another insurer or entity responsible for payment of the claim after the expiration of 18 months from the date that the original claim was paid. If the insurer, health service corporation, or health benefit plan retroactively denies, adjusts, or seeks recoupment or refund of a paid claim based on coordination of benefits, the insurer, health service corporation, or health benefit plan shall provide the health care provider with notice specifying the reason for the denial, adjustment, recoupment, or refund. If requested by a health care provider, an insurer, health service corporation, or health benefit plan shall furnish any available information concerning the name and address of the entity determined to be responsible for payment of the denied claim. Notwithstanding any other provision of law or contract to the contrary, if an insurer, health service corporation, or health benefit plan retroactively denies reimbursement for services as a result of coordination of benefits with another insurer, the health care provider shall have an additional six months from the date that the health care provider received the notice specified herein to submit a claim for reimbursement for the service to the insurer, health service corporation, health benefit plan, medical assistance program, government health benefit program, or other entity responsible for payment for the services provided.
(g) An insurer, health service corporation, or health benefit plan that retroactively denies, adjusts, or seeks recoupment or refund of a paid claim submitted by a health care provider shall give the health care provider notice specifying the reason for the action taken. Any retroactive denials, adjustments, or requests for recoupment or refund of previous payments which are based upon medical necessity determinations, level of service determinations, coding errors, or billing irregularities shall be reconciled to specific claims. A health care provider who disputes or contests the basis for the retroactive denial, adjustment, or request for recoupment or refund on all or any portion of a claim shall notify the insurer, health service corporation, or health benefit plan within 30 days after the provider receives the notice that the retroactive denial, adjustment, or request for recoupment or refund for overpayment is disputed or contested.
(h) Any provision of a contract between a health care provider and an insurer, health service corporation, or health benefit plan that is in conflict with the requirements of this section is unenforceable. The requirements of this section may not be waived between the health care provider and an insurer, health service corporation, or health benefit plan. Nothing in this section shall prevent or preclude an insurer, health service corporation, or health benefit plan from recovering in the circuit or district courts from a subscriber, enrollee, or beneficiary any amounts paid to a health care provider for benefits to which the subscriber, enrollee, or beneficiary was not entitled under the terms and conditions of the contract of insurance or the coverage agreement if the insurer, health service corporation, or health benefit plan is barred from seeking a retroactive denial, adjustment, or request for recoupment or refund from the health care provider under this section.
(i) The commissioner may assess an administrative fine against any insurer, health service corporation, or health benefit plan or may suspend or revoke the license or certificate of authority of any insurer, health service corporation, or health benefit plan after determining that the insurer, health service corporation, or health benefit plan has violated the requirements of subsections (e), (f), and (g) or has established a pattern of overdue payments and that the contemplated enforcement action would not promote the deterioration of the financial condition of an at-risk insurer, health service corporation, or health benefit plan. Such fine shall be up to one thousand dollars ($1,000) for each violation of the requirement of subsections (e), (f), and (g) or for each day that the claim or claims remained unpaid, not to exceed one hundred thousand dollars ($100,000) per violation. All fines recovered by the Department of Insurance shall be deposited in the General Fund and shall become available for use by the Department of Insurance for administration of the department.
(j) The State Department of Public Health is authorized to adopt regulations implementing those provisions of this section and Sections 27-1-19, 27-21A-23, and 10-4-115 that apply to health maintenance organizations. The commissioner is authorized to adopt such regulations as may be required to implement the provisions of this section and Sections 27-1-19, 27-21A-23, and 10-4-115 that apply to insurers and regulations governing the assessment of administrative fines authorized by this section.
(k) This section shall not apply to claims by the Alabama Medicaid Agency. This section shall also not apply Medicare claims except that Medicare + Choice plans shall be required to comply with any of the provisions of this section that are not in conflict with federal laws or regulations governing such plans.
(a) Whenever any group, or blanket hospital or medical expense insurance policy or hospital or medical service contract issued for delivery in this state provides for the reimbursement of health or health related services which includes mental health services, and such services are within the lawful scope of practice of a duly qualified psychiatrist or psychologist, the insured or other person entitled to benefits under such policy or contract shall be entitled to reimbursement for outpatient services, and inpatient services if requested by the attending physician, performed by a duly qualified psychiatrist or psychologist notwithstanding any provisions of the policy or contract to the contrary.
(b) For purposes of this section, a duly qualified psychologist means, one who is duly licensed or certified at the doctorate level in the state by the licensing board for psychologists of the state where the service is rendered, has had at least two years post-doctoral, clinical experience in a recognized health setting or has met the standards of the National Register of Health Service Providers in Psychology which require two years post-doctoral, clinical experience.
(c) Nothing in this section shall be construed to mandate or require an insurance company to include mental health services in a policy or contract which does not include such services, nor shall it be construed to expand the scope or nature of benefits provided when mental health services are included in a policy or contract.
(d) This section shall become effective immediately upon its passage and approval by the Governor, or upon its otherwise becoming law and shall apply to policies or contracts covered by the section delivered or issued for delivery in this state on and after such effective date and to group and blanket policies and contracts issued prior to the effective date on the next anniversary or renewal date or the expiration of the applicable collective bargaining agreement, if any, whichever date is the later.
(a) The insured, or health or dental plan beneficiary may assign reimbursement for health or dental care services directly to the provider of services. Health benefits include medical, pharmacy, podiatric, chiropractic, optometric, durable medical equipment and home care services. The company or agency, when authorized by the insured, or health or dental plan beneficiary, shall pay directly to the health care provider the amount of the claim, under the same criteria and payment schedule that would have been reimbursed directly to the contract provider, and any applicable interest. This amount only applies to assigned claims. Any company or agency making a payment to the insured, or health or dental plan beneficiary, after the rights of reimbursement have been assigned to the provider of services, shall be liable to the provider for the payment. If the company or agency fails to reimburse the provider in accordance with the terms of the provider contract as provided in this section, then the provider shall be entitled to recover in the circuit or district courts of this state from the company or agency responsible for the payment of the claim an amount equal to the value of such claim plus interest and a reasonable attorney's fee to be determined by the court.
(b) Nothing in this section shall be construed to limit any insurer, health maintenance organization, preferred provider organization, health care service corporation, or other third party payor from determining the scope of its benefits or services or any other terms of its group and/or individual insured, subscriber or enrollee contracts nor from negotiating contracts with licensed providers on reimbursement rates or any other lawful provisions, except that the contract providing coverage to an insured may not exclude the right of assignment of benefits to any provider at the same benefit rate as paid to a contract provider.
(c) This section shall not apply to any persons covered under a state administered health benefit plan.
For the purposes of this title, the following terms shall have the meanings respectively ascribed to them by this section.
(1) INSURANCE. A contract whereby one undertakes to indemnify another or pay or provide a specified amount or benefit upon determinable contingencies.
(2) INSURER. Every person engaged as indemnitor, surety or contractor in the business of entering into contracts of insurance.
(3) PERSON. An individual, insurer, company, association, organization, Lloyd's insurer, society, reciprocal insurer or interinsurance exchange, partnership, syndicate, business trust, corporation and every legal entity.
(4) COMMISSIONER. The Commissioner of Insurance of this state.
(5) DEPARTMENT. The Department of Insurance of this state.
(6) DOMESTIC INSURER. One formed under the laws of this state.
(7) FOREIGN INSURER. One formed under the laws of any jurisdiction other than this state. Except where distinguished by context, 'foreign' insurers includes also 'alien' insurers.
(8) ALIEN INSURER. One formed under the laws of any country other than the United States of America, its states, district, territories and commonwealths.
(9) STATE. Such term, when used in context signifying a jurisdiction other than the State of Alabama, means any state, district, territory, commonwealth or possession of the United States of America.
(10) AUTHORIZED INSURER; UNAUTHORIZED INSURER. An 'authorized' insurer is one duly authorized, by a subsisting certificate of authority issued by the commissioner, to transact insurance in this state. An 'unauthorized' insurer is one not so authorized.
(11) TRANSACT. Such term, with respect to insurance, includes any of the following:
a. Solicitation and inducement;
b. Preliminary negotiations;
c. Effectuation of a contract of insurance; or
d. Transaction of matters subsequent to effectuation of a contract of insurance and arising out of it.
(a) This section shall be known and may be cited as the 'Patient Right to Know Act.'
(b) As used in this section, unless the context clearly indicates otherwise, the following words shall have the following meanings:
(1) ENROLLEE. A person who purchases individual health care coverage or an employer who purchases a group health care plan.
(2) PROVIDER. A physician, dentist, podiatrist, pharmacist, optometrist, psychologist, clinical social worker, advanced nurse practitioner, registered optician, licensed professional counselor, physical therapist, and chiropractor.
(c)(1) All persons, firms, corporations, associations, health maintenance organizations, health insurance services, or preferred provider organizations, any employer-sponsored health benefit plan, or any similar organization or entity, providing health, accident, or dental insurance coverage, either directly or indirectly, shall provide an enrollee with a written description of the terms and conditions of the plan. The written plan description shall be in a simple, readable, and easily understandable format and shall include all of the following:
a. Coverage provisions including complete extent and exclusions or restrictions of coverage or service, including, but not limited to the following:
1. Outpatient physician services.
2. Referral to specialty physicians and other providers.
3. Choice of pharmacy providers.
4. Diagnostic tests, including mammography exams.
5. Dental services.
6. Chiropractic services.
7. Hospitalization.
8. Laboratory tests and services.
9. FDA approved therapies.
10. Prescription drug coverage.
11. Rehabilitation services, and physical, occupational, and vocational therapy.
12. Mental health services.
13. Long-term care.
14. Full range of reproductive services.
b. Extent of benefits provided or excluded, including prescription drug coverage with both generic and brand names.
c. Any exclusions or limitations by category of service, provider, and, if applicable, by the specific service or type of drug.
d. Any prior authorizations, including procedures for and limitations or restrictions on referrals to a provider other than primary care physicians, dentists, or other review requirements, including preauthorization review, concurrent review, postservice review, and postpayment review.
e. An explanation of the financial responsibility for payment of coinsurance or other noncovered or out-of-plan service.
f. Disclosure to enrollees that includes the following language:
'You have the right to information about how the plan operates its care delivery system and an explanation of the benefits to which participants are entitled under the terms of the plan.'
g. The phone number and address for the enrollee to obtain additional information concerning the items described in paragraph f.
(2) The organization or entity may provide the information under paragraph f of subdivision (1) of this subsection by providing information in the entity's annual financial statement most recently submitted to the Department of Insurance.
(d) The information provided by subsection (c) shall be updated annually and shall be provided to any enrollee on a schedule established by the entity.
(a) For the purposes of this section, the following words shall have the following meanings:
(1) ENROLLEE. A person enrolled in a health benefit plan.
(2) HEALTH BENEFIT PLAN. Any individual or group plan, policy, or contract for health care services issued, delivered, issued for delivery, renewed in this state by a health care insurer, health maintenance organization, accident and sickness insurer, fraternal benefit society, nonprofit hospital service corporation, nonprofit medical service corporation, health care service plan, or any other person, firm, corporation, joint venture, or other similar business entity that pays for, purchases, or furnishes health care services to patients, insureds, or beneficiaries in this state. The term includes, but is not limited to, entities created pursuant to Article 6 of Chapter 4 of Title 10. The term shall not include any collective bargaining agreement or any employee welfare benefit plan as defined in 29 U.S.C. Section 1002 (1) or any third party administrator to the extent it provides services to an employee welfare benefit plan. For the purposes of this section, a health benefit plan located or domiciled outside of the State of Alabama is deemed to be subject to the provisions of this section if it receives, processes, adjudicates, pays, or denies claims for health care services submitted by or on behalf of patients, insureds, or beneficiaries who reside in the State of Alabama or who receive health care services in the State of Alabama.
(b) Each health benefit plan shall apply the same coinsurance, copayment, deductible, and quantity limit factors within the same employee group and other plan-sponsored group factors to all drug prescriptions filled by a pharmacy provider, whether by a retail provider or a mail service provider, provided the retail provider complies with the same terms, conditions, services, and price as a mail service provider. Nothing in this section shall be construed to prohibit the health benefit plan from applying different coinsurance, copayment, and deductible factors within the same employer group and other plan-sponsored group between generic and brand name drugs, nor prohibit an employer or other plan-sponsored group from offering multiple options or choices of health benefit plans, including, but not limited to, cafeteria benefit plans.
(c) A health benefit plan shall not set a limit on the quantity of drugs which an enrollee may obtain at any one time with a prescription, unless the limit is applied uniformly to all pharmacy providers who comply with the same terms, conditions, services, and price as mail service providers.
(a) Every health benefit plan that provides coverage for prescription drugs or devices, or administers a plan, including, but not limited to, third party administrators for self-insured plans and state administered plans, excluding the Alabama Medicaid Program, shall issue to its insureds a card or other technology containing prescription drug information. The uniform prescription drug information card or technology shall be in the format approved by the National Council for Prescription Drug Programs (NCPDP) and shall include all of the required fields and conform to the most recent pharmacy ID card or technology implementation guide produced by NCPDP or conform to a national format acceptable to the Commissioner of Insurance. If a health care plan includes a conditional or situational field, it shall conform to the most recent pharmacy information card or technology implementation guide by the NCPDP or conform to a national format acceptable to the Commissioner of Insurance.
(b) A new uniform prescription drug information card or technology, as required under subsection (a), shall be issued by an insurer upon enrollment and revised upon any change in the certificate holder's coverage that impacts data contained on the card or upon any change in the NCPDP implementation guide or successor document, provided that the change affects data elements contained on the card. Newly issued cards or technology shall be updated with the latest coverage information and shall conform to the NCPDP standards in effect and to the implementation guide then in use.
(c) For purposes of this section, a 'health benefit plan' is a health insurance policy, including a self-insured health plan, that covers hospital, medical, or surgical expenses, health maintenance organizations, preferred provider organizations, medical service organizations, physician-hospital organizations, or any other person, firm, corporation, joint venture, or other similar business entity that pays for, purchases, or furnishes health care services to patients, insureds, or beneficiaries in this state. The term does not include accident-only, specified disease, individual hospital indemnity, credit, dental-only, Medicare-supplement, long-term care, or disability income insurance; coverage issued as a supplement to liability insurance, workers' compensation, or similar insurance; or automobile medical-payment insurance. For the purposes of this section, a health benefit plan located or domiciled outside of the State of Alabama is deemed to be subject to the provisions of this section if it receives, processes, adjudicates, pays, or denies claims for health care services submitted by or on behalf of patients, insureds, or beneficiaries who reside in the State of Alabama or who receive health care services in the State of Alabama. The term includes, but is not limited to, entities created pursuant to Article 6 of Chapter 4 of Title 10.
(d) Enforcement of this section shall be the responsibility of the Commissioner of Insurance. The Commissioner of Insurance shall promulgate rules necessary to effectuate this section. A health benefit plan may not conduct business in this state if the plan violates this section.
(e) For purposes of this section, renewal of a health benefit policy, contract, or plan is presumed to occur on each anniversary of the date on which coverage was first effective on the person or persons covered by the health benefit plan.
(a) A personal auto insurance carrier of a full-time law enforcement officer or firefighter of a municipality or a county or the State of Alabama shall not consider any motor vehicle accident of the full-time law enforcement officer or firefighter in fixing insurance premiums or cause any increase in the employee's personal automobile insurance premiums if, at the time of the accident, any of the following conditions exists:
(1) The full-time law enforcement officer or firefighter was acting as an agent of the governmental employer and the automobile accident occurred in the performance of their duties.
(2) The full-time law enforcement officer or firefighter was operating a motor vehicle owned by the governmental employer and the automobile accident occurred in the performance of their duties.
(3) The full-time law enforcement officer or firefighter was not negligent or operating the government vehicle in a negligent manner at the time of the accident.
(b) The full-time law enforcement officer or firefighter shall be exempt from filing the SR-13 form with the Department of Public Safety if any of the conditions in subsection (a) existed at the time of the motor vehicle accident.
No provision of this title shall apply with respect to:
(1) Domestic mutual aid associations, as identified in Chapter 30, except as stated in Chapter 30; or
(2) Fraternal benefit societies, as identified in Chapter 34, except as stated in Chapters 34 and 35.
This title shall not apply as to:
(1) Any fraternal or other organization or activity which is exempted from the provisions of Chapter 34 under Section 27-34-5, except to the extent provided in such section;
(2) Nonprofit corporations for establishment of hospitalization plan under Section 10-4-100 et seq., except to the extent now or hereafter provided in such laws;
(3) The insurance department of a brotherhood or labor union, the members of which are subject to the act of congress known as the Railway Labor Act; or
(4) The establishment, maintenance, administration and operation of any trust established pursuant to Section 22-21-240 by agreement of any hospitals, other health care units or dental practitioners licensed as such by the State of Alabama.
No person shall transact a business of insurance in Alabama, or relative to a subject resident, located or to be performed in Alabama, without complying with the applicable provisions of this title.
Provisions of this title relative to a particular kind of insurance, a particular type of insurer or a particular matter shall prevail over provisions in this title relating to insurance in general, insurers in general or such matters in general.
The scope and meaning of any provision shall not be limited or otherwise affected by the caption or heading of any chapter, section or provision.
(a) Any life insurance company of this state, for the purpose of investing its capital, surplus and other funds, or any part thereof, other than the deposit fund, may invest in notes secured by mortgages or trust deeds on unencumbered real estate located within the United States whose principal amount shall not be more than three fourths of the value of said real estate. For the purposes of this section, real estate shall not be deemed to be encumbered within the meaning of this section by reason of the existence of taxes or assessments that are not delinquent, instruments creating or reserving mineral, oil or timber rights, rights-of-way, joint driveways, sewer rights, public utility easements, rights in walls, nor by reason of building restrictions or other restrictive covenants nor when such real estate is subject to lease in whole or in part whereby rents or profits are reserved to the owner; provided, that the security created by the mortgage or trust deed on such real estate securing such note is a first lien upon such real estate and that there is no condition or right of reentry or forfeiture under which such lien can be cut off, subordinated or otherwise disturbed.
(b) Nothing contained in this section shall be construed to affect or limit the right heretofore granted to life insurance companies to invest funds in mortgages insured by the Federal Housing Commissioner or his successors or to loans guaranteed or insured by the Veterans Administration; nor shall anything contained in this section apply to purchase money obligations.
(a) In addition to all other investments now authorized by law, life insurance companies of this state are hereby authorized to invest in any loan or loans which may be guaranteed in whole or in part under the act of congress known as the Service Men's Readjustment Act of 1944, or any amendments thereto.
(b) Any portion of any such loan which is not either insured by the federal housing commissioner or guaranteed under said Service Men's Readjustment Act shall be subject to the provisions of law now in existence with respect to uninsured mortgage loans.
(c) This section is remedial in its nature and shall be liberally construed.
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