Texas pairs 30 and 45 day payment deadlines with a penalty keyed to billed charges rather than a flat interest rate. The rules below come from the Texas Insurance Code and Texas Department of Insurance pages.
To see what a late Texas payer owes on a specific claim, use the prompt pay interest calculator.
Texas prompt pay at a glance
| Statute | Tex. Ins. Code ch. 1301, subch. C (PPO and EPO) and ch. 843, subch. J (HMOs) |
|---|---|
| Electronic clean claim | Pay, partly pay, or deny within 30 days of receipt |
| Paper clean claim | Pay, partly pay, or deny within 45 days of receipt |
| Late payment | Tiered penalty on billed charges, plus 18% interest after 90 days late |
| Regulator for complaints | Texas Department of Insurance (TDI) |
The statute
Insurers’ preferred and exclusive provider plans fall under Insurance Code §§ 1301.101 to 1301.109 and 1301.131 to 1301.139. HMOs fall under §§ 843.336 to 843.346. Medicaid managed care is handled separately in Government Code § 540.0265.
We found no 2024 to 2026 amendment to the core deadlines or penalty tiers.
Clean-claim payment deadlines
For a clean claim from an in-network (preferred or participating) provider, the payer must pay, partly pay with a written explanation, or deny in writing within 30 days of receipt for electronic claims and 45 days for paper (§ 1301.103; § 843.338). A mailed claim is presumed received on the fifth day after mailing. An electronic claim is received on the date the payer or its clearinghouse confirms receipt.
A payer may request additional information once, in writing, within 30 calendar days of receipt, and then decides by the later of 15 days after the information arrives or the original deadline (§ 1301.1054). A claim the payer plans to audit must still be paid at 100% of the contracted rate within the 30 or 45 days, and the audit must finish within 180 days.
Not verified: the statute says “day” in these sections without specifying calendar or business days. Nearby subsections use “calendar day”.
Interest and penalties on late payment
The penalty is measured from the payment deadline (§ 1301.137; § 843.342). Paid late but before day 46, the penalty is the lesser of 50% of billed charges minus the contracted rate, or $100,000. From day 46 to day 90 it rises to the lesser of 100% of that difference, or $200,000.
On day 91 or later, the penalty is the day 46 to 90 amount plus 18% annual interest, running from the date payment was due. Underpaid claims follow the same tiers applied to the underpaid amount.
For physicians and other non-institutional providers, the statute sends the 18% interest to the Texas Health Insurance Risk Pool rather than to the provider. TDI says the pool dissolved in 2015 and TDI now collects that share. Payers that miss the deadline on more than 2% of clean claims also face an administrative penalty of up to $1,000 per day per unpaid claim.
Which payers the law covers
- Commercial fully insured plans: Covered for PPO and EPO plans (§ 1301.0041). The deadlines above apply to in-network providers.
- HMOs: Covered by chapter 843, subchapter J with the same deadlines and penalty tiers.
- Medicaid managed care plans: Not covered by chapter 1301, which excludes Medicaid managed care. Government Code § 540.0265 instead makes payment within 45 days a required contract term for most claims, extendable by written agreement to no more than 60 days, with no statutory penalty tiers.
- Self-funded ERISA plans: Not covered. A self-funded plan sponsor can opt into Insurance Code chapter 1275, but that opt-in covers balance billing and independent dispute resolution, not the prompt-pay penalties.
TDI says it does not regulate the state employee (ERS) or teacher (TRS) plans, and we found no prompt-pay provision in their governing chapters.
How to file a prompt-pay complaint
Providers file through the online complaint system linked from TDI’s provider complaint page. TDI requires a copy of the patient’s ID card, the relevant EOBs, proof that appeals are exhausted, and a timeline of the claim. Incomplete complaints are closed.
For complaints involving more than five claims, TDI asks providers to call its Help Line at 800-252-3439. The agency regulates HMO and fully insured plans only, so Medicaid plan complaints go to the Texas Health and Human Services Commission.
Not verified: HHSC’s provider complaint channel for Medicaid managed care plans. The HHSC site blocked our access, and the contact details we found came only from health plan flyers.
How prompt pay interacts with timely filing
Texas has a hard statutory filing deadline: a provider must submit the claim within 95 days of the date of service or lose the right to payment, unless a contract or a declared catastrophic event extends it (§ 1301.102; § 843.337). Timely filing runs from the date of service while the 30 or 45 day payment clock runs from receipt, so a claim that misses day 95 gets no prompt-pay protection at all. Our 2026 timely filing guide shows how the 95-day rule compares with other payers.
What we could not verify
- TDI’s prompt-pay rules in 28 TAC Chapter 21, Subchapter T, which we could not load. All figures above come from the statutes.
- Day type for the 30 and 45 day periods.
- HHSC’s provider complaint channel for Medicaid managed care plans.
- Whether chapter 843 also applies to an HMO’s Medicaid business. It has no express Medicaid exclusion.
- Medicaid plan late-payment penalties and filing windows, which are set by HHSC contract terms we did not review.
Sources
Billing for a practice with more than one location? See how we report denials and A/R by location.
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