Overview
Indiana Code Section 27-8-5.7 requires health insurers to pay clean claims within different timeframes based on submission method: 30 days for electronic claims and 45 days for paper claims, measured from receipt. Claims not paid within the applicable deadline accrue interest at 12% per year from the day payment was due. The Indiana Department of Insurance (IDOI) enforces these requirements.
Key Requirements
- Electronic Claims Deadline: 30 days from receipt of a clean claim submitted electronically.
- Paper Claims Deadline: 45 days from receipt of a clean claim submitted on paper.
- Interest Rate: 12% annual interest on claims unpaid after the applicable deadline, accruing from the day payment was due through the payment date.
- Clean Claim Standard: A complete claim with all required information triggers the payment deadline. Incomplete claims do not start the clock; a new deadline begins upon complete resubmission.
- Information Requests: Insurers must request missing information within 10 business days of receipt, specifying the deficiencies clearly.
Penalties and Enforcement
The Indiana Department of Insurance enforces timely payment requirements. Insurers that fail to pay clean claims within the applicable deadline and refuse to pay interest are subject to enforcement action. Pattern violations result in market conduct examinations, civil penalties, and required corrective action plans. Interest owed is mandatory and must be paid in addition to the original claim amount.
Appeals and Exceptions
Providers have appeal rights for any claim denial. The primary exception to the payment deadline is fraud investigation, during which the insurer may delay payment. Once the investigation concludes, the insurer must pay or deny the claim within the applicable deadline. Emergency and urgent claims must meet the same timelines.
Interaction with Federal Law
Indiana's prompt pay law applies to state-regulated health insurance plans. Self-funded ERISA plans are exempt from state insurance regulation and follow federal claims processing requirements instead. Medicare and Medicaid operate under their own separate timelines that are independent of Indiana state law.
Common Questions
Does Indiana apply different deadlines for electronic vs. paper claims?
Yes. Indiana law requires insurers to pay electronic claims within 30 days of receipt and paper claims within 45 days of receipt. Both deadlines apply to clean claims.
What interest rate does Indiana require on late claim payments?
Indiana requires 12% per year interest on claims paid after the deadline, accruing from the day payment was due.
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State laws change. This reference is current as of 2026-04-13. Consult state statutes or a healthcare attorney for definitive guidance.