insurance; claims processing; downcoded claims

HB 2407 prohibits health insurers in Arizona from using automatic systems to unilaterally reduce claim payments ("downcode") without proper review. It requires insurers to notify healthcare providers with specific details (including clinical criteria used, original/revised codes, and the reviewer's credentials) when downcoding occurs, and establishes a clear 180-day appeal process for providers. Insurers must also avoid discriminatory downcoding against providers treating complex cases and face civil penalties of up to $100 per violation for noncompliance. This bill directly affects health insurers (including insurance companies, health care organizations, and third-party payers) and healthcare professionals who submit claims for services.