AMA: ‘Void’ exists in prompt pay law

April 10, 2013

The American Medical Association has filed a brief in federal court in support of a Georgia law that was created to curb “unfair business practices” by companies that pay medical bills.

The American Medical Association (AMA) has filed a brief in federal court in support of a Georgia law that was created to curb “unfair business practices” by companies that pay medical bills.

The AMA and the Medical Association of Georgia (MAG) contend that the state’s prompt pay law regulates only 35% of Georgia’s health benefits market, but at the same time remains critically important to help physicians gain timely reimbursements. The issue was recently cast into the public spotlight after a trial court decided that the federal Employee Retirement Income Security Act (ERISA) exempts third-party administrators from being held accountable under the prompt payment law.

The issue has raised concerns among both the AMA and MAG and resulted in their filing this legal brief. In fact, the AMA and MAG want the federal appeals court to lift the injunction and “declare that Georgia’s prompt payment law is not preempted by ERISA,” or remand the case to a lower court where they say the ERISA preemption issues can be more properly addressed.

“This leaves a regulatory void where the state’s third-party administrators are unaccountable for chronically late payments, and it jeopardizes a sustainable practice environment for Georgia’s physicians,” says Jeremy Lazarus, MD, president of the AMA.