Tennessee Prompt Pay Law: 5 Clear Rules for Therapy Claims
The Tennessee prompt pay law, Tenn. Code Ann. § 56-7-109, sets how fast an insurer must act on a clean claim and adds interest when it pays late. Status is current as of October 17, 2026. This is operational guidance, not legal advice. Verify the statute and Tennessee Department of Commerce and Insurance (TDCI) guidance before you rely on it.
This guide covers the deadlines, the plans the law may not reach, how to track dates, and how to complain. Private-payer, TennCare, and Medicare rules are kept apart below. See also our Billing Terms Glossary.
What the Tennessee prompt pay law requires in 5 rules
These rules come from the statute as summarized in a 2024 Tennessee insurance compendium. A TDCI bulletin confirms the statute and the clean claim definition.
- A clean claim needs no further information, adjustment, or alteration by the provider.
- For electronic claims, the insurer has 21 calendar days.
- For paper claims, the insurer has 30 days.
- Within that window, the insurer pays the clean claim, pays the clean undisputed portion, or explains in writing why it will not pay and what is missing.
- If it misses the deadline, interest of 1% per month accrues from the day after payment was due.
For a therapy or psychiatry practice, the practical effect is simple: a clean, electronic claim has the shortest clock, and a vague denial does not excuse the insurer from explaining itself in writing. The written explanation is also your best tool for fixing and refiling quickly.
Who the Tennessee prompt pay law does not cover
Private-payer rule. Self-funded ERISA plans (Employee Retirement Income Security Act plans) are exempt from state regulation, per the NAIC. Many employers use an administrative services only (ASO) arrangement. Look for “self-funded” on the member ID card, and ask the payer if unsure.
TennCare rule. TennCare managed care plans follow Tenn. Code Ann. § 56-32-126(b)(1): 90% of claims needing no further information within 30 calendar days, and 99.5% within 60 days, per TDCI. Those are plan-wide percentages, not a per-claim deadline. See Tennessee Medicaid billing.
Medicare rule. Medicare is federal and has its own 12-month filing limit. See also our Texas Medicare Part B guide.
How to track the Tennessee prompt pay law on your claims
Most late payments start with a missing date. Record the date each payer received the claim. Count 21 days for electronic claims and 30 for paper. If a clean claim is still unpaid on day 22, call the payer and ask for a written explanation. Put any interest request in writing too. Our claim denials and appeals guide shows how to document each step, and the in-network vs out-of-network page explains why contracts matter.
Filing a complaint with TDCI
TDCI takes insurance complaints through an online form from the National Association of Insurance Commissioners (NAIC), per the TDCI complaint page. Gather claim dates, payer replies, and proof of submission first. Complaints about self-funded plans generally belong elsewhere, so confirm the plan type. If the payer calls a claim not clean, ask it to name the exact missing item in writing and fix it fast. Resubmit with proof of the new date, and keep every reference number from your calls.
| Payer type | Where the rule lives | What to check |
|---|---|---|
| Private insurance | State prompt pay statute and the plan contract | The payment deadline and what the plan calls a clean claim |
| Medicaid | State Medicaid agency and the managed care plan contract | Filing and payment timelines, which vary by state |
| Medicare | CMS and your Medicare Administrative Contractor | Federal claim timing rules, separate from state law |
Practical tips for Tennessee prompt pay law
Use the Tennessee prompt pay law as a checklist, not a threat. Submit clean claims electronically so the shorter deadline applies. Check plan type before you cite the Tennessee prompt pay law to a payer. Keep a simple log of claim, submission date, and payer reply so you can show your work if a dispute arises. Compare how Texas handles it in our Texas prompt pay law guide.
Where MCM South helps
MCM South Medical Billing Service, LLC bills for psychotherapists and psychiatrists in ten currently served states: GA, MA, CT, TX, FL, NY, CO, TN, NC, and IL. We handle in-network and out-of-network claims. Get a Free Quote or Schedule a Consultation.
Keep learning: browse the State & Regional Billing Guides, the Tennessee insurance companies contact guide, the Billing Terms Glossary, and all Resources.
More from MCM South: timely filing glossary entry; underpayments guide; credentialing service.
FAQs
How long does an insurer have to pay under the Tennessee prompt pay law?
Twenty-one calendar days for electronic clean claims and 30 days for paper claims.
Does the Tennessee prompt pay law cover self-funded plans?
No. Self-funded ERISA plans are exempt from state insurance regulation, so check the plan type first.
Is there interest under the Tennessee prompt pay law?
Yes. Late payment accrues 1% interest per month from the day after payment was due.
How do I file a Tennessee prompt pay law complaint?
Use the TDCI online insurance complaint form and attach your claim dates and payer responses.
