Texas Prompt Pay Law: Payment and Filing Deadlines for Therapy Claims
The Texas prompt pay law sets two clocks for every therapy claim: how fast you must file and how fast the insurer must respond. Miss the filing clock and you can forfeit payment. Miss the payment clock and the insurer can owe penalties. This guide explains both deadlines in Texas Insurance Code Chapter 1301, who is outside the law and how to complain to the Texas Department of Insurance (TDI). Check the statute and TDI before you rely on any deadline. This is operational guidance, not legal advice.
Your filing deadline under the Texas prompt pay law
Under Texas Insurance Code section 1301.102, a provider must submit a claim no later than the 95th day after the date of care. A claim filed late forfeits the right to payment. The deadline can be extended by contract, by TDI notice after a catastrophic event or with TDI approval. See the Chapter 1301 statute.
Under the Texas prompt pay law, 95 days is the statutory deadline for preferred provider contracts, and your contract may allow more. Read each payer agreement and calendar the shortest limit.
The insurer’s payment clock under the Texas prompt pay law
Under section 1301.103, the insurer must decide whether a clean claim from a preferred provider is payable by the 30th day after it receives an electronic claim, or the 45th day after it receives a paper claim. It must then pay the claim, pay the undisputed part with a written explanation or explain in writing why it will not pay. TDI says the count starts the day after receipt. See the TDI prompt pay FAQ.
- Audits: to audit a clean claim, the insurer must first pay 100 percent of the contracted rate within the same 30 or 45 days (section 1301.105). TDI says audits of clean claims must finish within 180 days.
- More information: an insurer may make one written request for additional information within 30 calendar days of receiving a clean claim (section 1301.1054).
- Overpayments: an insurer may recover an overpayment only with written notice within 180 days of payment (section 1301.132).
Penalties for late payment under the Texas prompt pay law
The statute sets penalties for late payment in section 1301.137. TDI says they are based on billed charges for contracts issued or renewed after August 16, 2003, and they cannot be waived by contract. Read the section for the current tiers. TDI also says to contact the carrier first and assert your right to the penalty, and that penalties for underpayments must be claimed within 270 days under 28 Texas Administrative Code section 21.2815. Keep your dates in a log.
Who the Texas prompt pay law does not cover
- Self-funded ERISA plans. TDI says the laws do not apply to them.
- CHIP, Medicaid and Medicare Advantage plans are exempt, and plans from out of state are not covered.
- Check the member ID card. A plan regulated by TDI must show “TDI” or “DOI” on the front of the card, under 28 Texas Administrative Code section 21.2820.
HMOs fall under Chapter 843, which has its own prompt pay sections. See the TDI HMO prompt pay page for those rules.
Private insurers, Medicare and Medicaid: different clocks
| Payer type | Who sets the rule | What to know |
|---|---|---|
| Private preferred provider plan | Texas Insurance Code Chapter 1301 | File within 95 days unless your contract extends it. Insurer decides within 30 days (electronic) or 45 days (paper). |
| Medicare | Federal rules | File within 12 months of the date of service, per the CMS Claims Processing Manual. |
| Texas Medicaid | HHSC, TMHP and each managed care plan | TMHP says claims must be received within 95 days of each date of service unless otherwise stated. Managed care claims go to the plan. See the TMHP claims filing manual. |
Do not mix them up. A 95-day limit appears in both private and Medicaid rules, but they come from different sources, so read each one. The Texas prompt pay law covers only the private plan row.
How to escalate a late claim to TDI
TDI’s provider complaint page says to file with TDI if the card shows “TDI” or “DOI.” Have these ready: a copy of the card front, your explanations of benefits, proof that your appeals are exhausted, authorization documents and a claim timeline. File through TDI’s online complaint system. TDI closes complaints with missing information. The TDI Help Line is 800-252-3439, and prompt pay questions can go to . Our Texas insurance companies contact guide lists insurer provider lines for the first call.
Where MCM South helps
MCM South Medical Billing Service bills for psychotherapists and psychiatrists, and denied claim follow-up is part of that work. We currently serve practices in Georgia, Massachusetts, Connecticut, Texas, Florida, New York, Colorado, Tennessee, North Carolina and Illinois. If tracking the Texas prompt pay law deadlines is taking your week, get a free quote or schedule a consultation.
Keep learning: the insurance companies contact by state directory, the billing terms glossary, the CPT and E/M code guide, insurance credentialing, credentialing and network status, the mental health billing FAQ and who we serve. Confirm each deadline with the source.
FAQs
How long do I have to file a claim under the Texas prompt pay law?
Section 1301.102 requires a provider to submit a claim no later than the 95th day after the date of care, unless the contract, TDI notice or TDI approval extends it. A late claim forfeits the right to payment.
How long does an insurer have to pay under the Texas prompt pay law?
The insurer must decide whether a clean claim is payable by day 30 for electronic claims or day 45 for paper claims, then pay, pay the undisputed part or explain in writing.
Does the Texas prompt pay law cover self-funded plans?
No. TDI says the laws do not apply to self-funded ERISA plans, and CHIP, Medicaid and Medicare Advantage plans are exempt.
How do I file a Texas prompt pay law complaint?
Use TDI’s online complaint system if the member ID card shows TDI or DOI, and include the card front, explanations of benefits, proof of exhausted appeals and a claim timeline.
