Arizona SB 1607: involuntary treatment; process; substance abuse

Bill Text

SB1607 - 572R - I Ver 

 REFERENCE TITLE: consumer assistance; health insurance claims

 State of Arizona

 Senate

 Fifty-seventh Legislature

 Second Regular Session

 2026

 SB 1607

 Introduced by 

 Senators 
 Kuby: Epstein, Miranda, Ortiz, Sundareshan;� Representative Garcia

AN 
ACT

amending title 20, chapter 1, article 1, 
Arizona Revised Statutes, by adding section 20-128; appropriating monies; 
relating to the department of insurance and financial institutions.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Title 20, chapter 1, article 1, 
Arizona Revised Statutes, is amended by adding section 20-128, to read:

START_STATUTE20-128. Health care claims consumer assistance program; civil penalty; 
data collection; reporting requirements; public posting; rules; definitions

A. A health care claims consumer 
assistance program is established in the department to provide support to 
consumers who are enrolled in a health plan or who are seeking to enroll in a 
health plan.

B. The health care claims consumer 
assistance program shall:

1. Assist consumers with filing 
complaints and appeals with a health insurer or with the utilization review 
process as provided in chapter 15 of this title.

2. Assist consumers with settling 
conflicts, disputed claims or claims denials with a health insurer.

3. Educate consumers on their rights 
and responsibilities with respect to health insurance coverage.

c. The department may impose civil 
penalties if the department finds that a health insurer continuously violates a 
health plan.� If the department provides proper notice and an opportunity to 
the health insurer to remedy repeated violations and the health insurer 
continues to violate a health plan, the department may impose a civil penalty 
of at least $25,000 for each violation for which the health insurer wrongfully 
denied or insufficiently paid a valid consumer insurance claim.

d. If the department or a court finds 
that a health insurer has wrongfully denied or insufficiently covered a valid 
consumer insurance claim, the health insurer is automatically liable to pay 
double the amount that was wrongfully denied or insufficiently covered, 
including attorney fees.

e. The department or the court may 
assess additional damages to be paid to an insured on review of the following 
factors, as appropriate, if the harm was severe:

1. The nature, scope and gravity of 
the violation.

2. The severity of the potential harm 
to the policyholder, including:

(a) Loss of 
life.

(b) Loss of 
health.

(c) Emotional 
distress.

(d) Financial 
harm.

3. The nature and extent to which the 
health insurer cooperated with the department.

4. The nature and extent to which the 
health insurer aggravated or mitigated any injury or damage caused by the 
violation.

5. The nature and extent to which the 
health insurer has taken corrective action to ensure the violation will not 
recur.

f. On or before December 31, 2026 and 
every year thereafter, the department shall adjust the penalty amount 
prescribed in subsection c of this section based on whichever is the higher of:

1. The average rate of change in 
premium rates for insureds in a group market that is weighted by enrollment 
since the previous adjustment.

2. Any adjustment based on inflation.

g. The department shall keep records 
of wrongful claims denials that are brought to the health care claims consumer 
assistance program.

h. A health insurer shall disclose 
data on wrongful claims denials to the department on request and in a readable 
format that includes:

1. The number, percentage and types 
of denied claims.

2. The number, percentage and types 
of wrongfully denied claims.

i. If a health insurer is found to 
have violated this section more than the median percentage of wrongful denials 
since the previous year, the department shall review each violation in the 
current year to determine whether penalties should be imposed.

J. on or before May 1, 2027 and every 
year thereafter, the department shall:

1. Compile a report that contains all 
of the following:

(a) The number 
and type of denied claims, including raw numbers and numbers as a percentage of 
the total claims.

(b) The number 
and type of wrongfully denied claims, including raw numbers and numbers as a 
percentage of the total claims.

(c) The number 
and type of denied claims that were appealed and reported to the health care 
claims consumer assistance program.

(d) The number 
of denied claims that were appealed and brought to the health care claims 
consumer assistance program.

(e) the number, 
type and percentage of wrongfully denied claims by each insurer for each health 
plan.

(f) The outcome 
of any investigation for each health insurer that was conducted by the 
department for a violation of this section.

2. Post the report on the 
department's publicly accessible website and provide a copy to:

(a) The 
governor's