Claims Payment Policies & Other Information
- Out-of-network liability and balance billing
Out of network coverage means covered services that are received:
- a. from Non-Participating Providers when appropriate access to a Participating Provider is available;
- b. when the Plan has not authorized the referral to a Non-Participating Provider;
- c. for a non-emergency or non-urgent care situation; or
- d. from a Participating Practitioner and/or Provider outside of the Sanford Health Plan Services Area when the Member is traveling outside of the Plan's service area for the purpose of receiving such services and:
- i. a Participating Practitioner and/or Provider has not recommended the referral; and
- ii. the Plan has not authorized the referral to a Participating Practitioner and/or Provider outside of the Plan's Service Area.
When members obtain covered non-emergency medical treatment from a Non-Participating Provider without authorization from Sanford Health Plan, members are subject to the Deductibles, Coinsurance and maximum benefits stated in the Summary of Benefits and Coverage document.
All Out-of-Network services, if covered, are subject to Reasonable Cost. For Out-of-Network Coverage, the Plan will pay a percentage of the Reasonable Cost after credit is given for payment of applicable Copays, Deductibles, and Coinsurance, provided that the Plan determines the billed charges are Reasonable. If the Plan determines that the billed charges are not reasonable, the Plan will only pay a percentage of the Reasonable Costs. Percentage amounts are indicated on the Summary of Benefits and Coverage. Providers are allowed to balance bill the member for the billed charges that are not reasonable. Therefore, members will experience more out of pocket costs when using Out-of-Network providers.
Members who live outside of the Plan’s Service Area must use the Plan’s Network Participating Providers as indicated on the Member Welcome Letter enclosed with the Member Identification Card. Members who live outside the Service Area will receive Identification Cards that display their network logo along with instructions on how to access this Network. If a Member chooses to go to a Non-Participating Provider when access is available, claims will be paid at the Out-of-Network Benefit Level.
Reimbursement of Charges by Non-Participating Providers
Sanford Health Plan does not have contractual relationships with Non-Participating Practitioner and/or Providers and they may not accept the Plan’s payment arrangements. In addition to any Copay, Deductible, or Coinsurance amount required for that service, Members are responsible for any difference between the amount charged and the Plan’s payment for covered services. Non-Participating Practitioner and/or Providers are reimbursed the Maximum Allowed Amount, which is the lesser of (a) the amount charged for a covered service or supply or (b) Reasonable Costs. When a Member receives Covered Services from a Participating Provider, the Plan will pay the Participating Provider directly, and the Member will not have to submit claims for payment. The Member’s only payment responsibility, in this case, is to pay the Participating Provider, at the time of service, any Copay, Deductible, or Coinsurance amount required for that service. Participating Providers agree to accept Sanford Health Plan’s payment arrangements or negotiated contract amounts.
- Enrollee Claim Submission
When members see Participation Providers, receive services at Participating Providers and facilities, or obtain your prescription drugs at Network pharmacies, members will not have to file claims. Participating provider will file the claim for the member. Members should present their identification cards and pay applicable copay/coinsurance.
Time Limits. Participating Providers must file claims to the Plan within one hundred eighty (180) days after the date that the cost was incurred. If Member fails to show his/her Plan ID card at the time of service, then Member may be responsible for payment of claim after Practitioner and/or Provider’s timely filing period of one hundred eighty (180) days has expired. In any event, the claim must be submitted to the Plan no later than one hundred eighty (180) days after the date that the cost was incurred, unless the claimant was legally incapacitated
Members may need to file a claim when receiving emergency services from Non-Participating Practitioners and/or Providers. Check with the Practitioner and/or Provider, as they may submit the claim to Sanford Health Plan on the members behalf. Members are responsible for making sure the claim is submitted to the Plan within one-hundred-eighty (180) days after the date that the cost was incurred. If the member or the Non-Participating Practitioner and/or Provider, does not file the claim within one-hundred-eighty (180) days after the date that the cost was incurred, the member will be responsible for payment of the claim.
If necessary, claims should be submitted to: Sanford Health Plan, PO Box 91110, Sioux Falls SD 57109-1110. A fillable claim form can be found here.
- Grace periods and claims pending
The monthly health insurance premium payment is due on the 1st of each month. The member’s policy is considered delinquent at the end of the month. This puts the policy into the “HIX Delinquent 1 month” status, in which the 1st delinquency notice letter is mailed, and claims are put on hold effective the first day of the following month.
After 2 consecutive months of non-payment, the policy is put into the “HIX Delinquent 2 months” status, in which the 2nd delinquency notice letter is mailed.
After 3 consecutive months of non-payment, the policy is put into the “HIX Delinquent 3 months” status, in which the Final delinquency notice letter is mailed, giving the member until the last day of the third month to make a payment.
At the end of the 3 month grace period, a Termination letter is sent to the member following the final date given on the late notices. The policy is terminated for non-payment of premiums effective the last day of the month of the first month of the grace period.
The grace period is defined as the timeframe that a member has to pay the premium before the policy is terminated. Any claims received during the grace period are pended for payment until the premium payment is received. Claims are not pended during the first 30 days of the grace period.
- Retroactive Denials
If the member does not pay their premium during the grace period, claims will be reversed retroactively to the assigned termination date according to the “paid through date” on the account. Therefore, it is important that members pay their premiums on time.
- Recoupment of overpayments
Sanford Health Plan will issue premium refunds that are due on terminated accounts. A refund does not need to be requested, it will be automatically calculated and processed.
- Medical necessity and prior authorization timeframes and enrollee responsibilities
Sanford Health Plan’s Utilization Management Department will review the Member profile information against standard medical necessity criteria. A determination for elective inpatient or non-urgent care will be made by the Utilization Management Department within fifteen (15) calendar days of receipt of the request. If the Utilization Management Department is unable to make a decision due to matters beyond its control, it may extend the decision time frame once, for up to fifteen (15) calendar days. Within fifteen (15) calendar days of the request for authorization (Certification), Sanford Health Plan will notify the Member or Member’s Authorized Representative of the need for an extension and the date by which it expects to make a decision.
Prior authorization (certification) is the urgent or non-urgent authorization of a requested service for medical care, including care for behavioral, mental health, and/or substance use disorders, prior to receiving the service. Prior authorization (or precertification/pre-service decisions) is designed to facilitate early identification of the treatment plan to ensure medical management and available resources are provided throughout an episode of care. The Member is ultimately responsible for obtaining prior authorization from the Utilization Management Department in order to receive In-Network coverage. However, information provided by the practitioner’s office will also satisfy this requirement. Primary care physicians and any Participating Specialists have been given instructions on how to get the necessary authorizations for surgical procedures or hospitalizations members may need.
The Plan determines approval for prior authorization based on appropriateness of care and service and existence of coverage. The Plan does not compensate practitioners and/or providers or other individuals conducting utilization review for issuing denials of coverage or service care. Any financial incentives offered to Utilization Management decision makers do not encourage decisions that result in underutilization and do not encourage denials of coverage or service.
Prior authorization is required for all inpatient admissions of Plan members. This requirement applies to, but is not limited to the following:
- Acute care hospitalizations (including medical, surgical, obstetric, and non-emergency mental health or substance use disorder inpatient admissions);
- Residential Treatment Facility admissions; and
- Rehabilitation center admissions.
Admission before the day of non-emergency surgery will not be authorized unless the early admission is medically necessary and specifically approved by the Plan. Coverage for Hospital expenses prior to the day of surgery will be denied unless authorized prior to being incurred.
Services that require prior authorization
- Inpatient Hospital admissions including admissions for medical, surgical, neonatal intensive care nursery, mental health and/or substance use disorder services;
- Select Outpatient Services;
- Home Health, Hospice and Home IV therapy services;
- Select Durable Medical Equipment (DME).
- Skilled nursing and sub-acute care;
- Transplant Services;
- Prosthetic Limbs;
- Genetic Testing;
- Select Orthotics and Prosthetics;
- Medically-Necessary Orthodontics;
- Select Specialty Drugs;
- Bariatric Surgery;
- Insulin infusion devices;
- Insulin pumps;
- Continuous Glucose Monitoring Systems (CGM);
- Referrals to Non-Participating Providers, which are recommended by Participating Providers. Certification is required for the purposes of receiving In-Network coverage only. If Certification is not obtained for referrals to Non-Participating Providers, the services will be covered at the Out-of-Network Benefit Level. Certification does not apply to services that are provided by Non-Participating Providers as a result of a lack of appropriate access to Participating Providers; and
- Cochlear implants and bone-anchored (hearing aid) implants.
- External hearing aids for the treatment of a hearing loss that is not due to the gradual deterioration that occurs with aging and/or other lifestyle factors.
Additional information, such as prospective non-urgent review, prospective review for emergency services, etc. can be found in the members policy.
- Drug exception timeframes and enrollee responsibilities
Members are required to use drugs and medications on the Sanford Health Plan formulary. The formulary is a list of FDA-approved brand name and generic medications chosen by health care providers on the Physician Quality Committee. The Committee chooses medications that are clinically effective, safe, and cost-effective. Changes may be made throughout the year as warranted with a complete evaluation each year. Sanford Health Plan will publish these changes and notify Members if any of the formulary changes impact their cost sharing or accessibility.
Members are allowed to request and gain access to clinically appropriate drugs not covered under the Plan’s Formulary. Members can request an exception to the Plan’s formulary for: 1) a non-covered medication or drug; or 2) a medication, or drug not currently listed in the Sanford Health Plan Formulary, the Plan follows the following processes and procedures:
- The Practitioner, Member, or Member’s Authorized Representative, contacts the Pharmacy Management Department via a phone call, email, online fillable form submission, or letter of medical necessity requesting coverage for the specific medication or drug.
- The Plan’s Chief Medical Officer or designee will review the request based on medical necessity criteria and make a determination within the following timeframes:
- For Expedited Exception Requests, the Plan will make its coverage determination no later than 24 hours after receiving the request and notify the Member, the Member’s Authorized Representative, and/or the Provider/Practitioner. If an exception is granted based on Exigent Circumstances, the Plan will provide coverage of the non-formulary drug for the duration of the exigency.
- For Standard Exception Requests, the Plan will make its coverage determination within 72 hours of receiving the request and notify the Member, the Member’s Authorized Representative, and/or the Provider/Practitioner.
- The Plan will use appropriate practitioners to consider exception requests and promptly grant an exception to the drug formulary, including exceptions for anti-psychotic and other drugs to treat mental health conditions, for a member when the practitioner prescribing the drug indicates to the Plan that:
- the formulary drug causes an adverse reaction in the Member;
- the formulary drug is contraindicated for the Member; or
- the prescription drug must be dispensed as written to provide maximum medical benefit to the Member.
- NOTE: Members must generally try formulary medications before an exception for the formulary will be made for non-formulary medication use.
- For contraceptives not currently in the Plan Formulary, if the attending provider determines that a drug/device is medically indicated and an exception to the formulary is granted, the contraceptive drug/device will be covered by the Plan at 100% (no charge).
- If the decision is to approve the request, and the request is a Standard Exception Request, the Plan will provide coverage of the non-formulary drug for the duration of the prescription, including refills. If the decision is to approve the request, and the request is an Expedited Exception Request, based upon exigent circumstances, the Plan will provide coverage of the non-formulary drug for the duration of the exigency.
- In the event that an exception request is granted, the Plan will treat the excepted drug(s) as an essential health benefit, including, if applicable under the Member’s covered benefits, counting any Member cost-sharing toward the Member’s annual limitation on cost-sharing, and when calculating the actuarial value.
- If the decision is to deny a request, the Member and provider will be provided a reason for the denial and written notice in accordance with the Written Notification Process for Adverse Determinations procedure below. The Member, applicable Provider(s) and/or Practitioner(s), and if applicable, the Member’s Authorized Representative, will be notified by phone and in writing. At this point, the Member has the right to request an Appeal of Adverse Determination. Members should refer to their policy for details on this process.
- If the Adverse Determination is regarding a Standard Exception Request, standard appeal rights apply, as outlined in the Member policy.
- If the Adverse Determination is regarding an Expedited Exception Request, expedited appeal rights apply and the Member, Member’s Authorized Representative, and/or Provider/Practitioner may exercise expedited (urgent) appeal rights, including a request for external review as outlined in the Members Policy.
- Explanation of benefits (EOBs)
After a members claim is processed, Sanford Health Plan sends the member an EOB outlining the charges that were covered. We also notify the health care professionals of the covered charges.
The following picture describes important terms used in the member Explanation of Benefits (EOB) and throughout the claims payment process. Reviewing this will help the member become familiar with these terms in order to better understand their benefit plan.
The purpose of an EOB is to show the benefits coverage the member received for the services billed to Sanford Health Plan by the members health care Practitioner and/or Provider. The Explanation of Benefits shows the dollar amount of services that were billed by the member’s Practitioner and/or Provider and how that amount is applied to deductible, coinsurance or copayments, or if any of the charges were for non-covered services. Members will be able to clearly see the amount they owe to the provider. Members can sign up (through their secure online member account) for electronic EOBs to reduce the amount of paper mail.
- Coordination of benefits (COB).
If a member is covered by another health plan, insurance, or other coverage arrangement, the plans and/or insurance companies will share or allocate the costs of the Member’s health care by a process called “Coordination of Benefits” so that the same care is not paid for twice. The Member has two obligations concerning Coordination of Benefits (“COB”):
- The Member must tell the Plan about any other plans or insurance that cover health care for the Member, and
- The Member must cooperate with the Plan by providing any information requested by the Plan
If a member is covered by another health plan, insurance, or other coverage arrangement, the plans and/or insurance companies will share.
Ordering of Benefits
The order of benefit determination rules govern the order in which each plan will pay a claim for benefits. The plan that pays first is called the primary plan. The primary plan must pay benefits in accordance with its policy terms without regard to the possibility that another plan may cover some expense. The plan that pays after the primary plan is the secondary plan. The secondary plan may reduce the benefits it pays so that payments from all plans does not exceed 100% of the total allowable expense.
Additional, more detailed information regarding coordination of benefits, can be found in the member policy.