Section 900.10  Scope

 

a)         These rules are applicable to all State agencies as defined in the Illinois State Auditing Act [30 ILCS 5] and shall be followed in determining whether and to what extent late payment interest is due.

 

b)         These rules apply to any bill for Goods or Services payable from funds appropriated by the General Assembly for periods on and after July 1, 2002, and do not affect bills payable from funds appropriated for prior periods.

 

(Source:  Amended at 26 Ill. Reg. 14666, effective September 19, 2002)

 

Section 900.20  Definitions

 

Except as otherwise defined in Section 900.130, the following definitions shall be used in interpreting these rules:

 

"Act" shall be defined as:  the State Prompt Payment Act [30 ILCS 540].

 

"Agency Head"  shall be defined as:  those persons given authority to approve payments for the various State officials and agencies as specified in the Act and Section 10 of the State Finance Act [30 ILCS 105/10].

 

"Bill" shall be defined as:  the Vendor's standard bill or invoice for goods or services. For purposes of this Part, bill shall include a State employee's travel voucher submitted when the State employee has paid for the travel and will be reimbursed by the State.

 

"DCMS" shall be defined as:  the Department of Central Management Services.

 

"Date of Approval of the Vendor's Bill" shall be defined as:  the date on which the Agency Head or designee signs the voucher requesting the Comptroller's Office to pay the bill. For agencies whose computer systems automatically record an approval date as a voucher is prepared, the "Date of Approval" shall be defined as the approval date recorded by the computer system.

 

"Date of Payment" shall be defined as:  the date of issuance of the payment by the Comptroller's office.

 

"Goods and Services" and "Goods or Services" shall be defined as: items of merchandise, supplies, raw materials, finished goods and duty, duties or labor rendered by one or more persons to a State official or agency for monetary or other consideration.

 

"Month" shall be defined as:  any 30-day period.

 

"Proper Bill" shall be defined as: a bill or invoice containing sufficient and correct information necessary to process the payment for a liability of a State agency as provided in this Part, the Comptroller's Statewide Accounting Management System (SAMS) manual, or as otherwise specified by the State agency responsible for payment.

 

"Vendor" shall be defined as:  seller of goods or services. For purposes of this Part, Vendor shall include State employees who submit a travel voucher for reimbursement to the employees for travel.

 

(Source:  Amended at 26 Ill. Reg. 14666, effective September 19, 2002)

 

Section 900.30  General Duties of State Agencies

 

a)         It is the duty and responsibility of each State agency to develop and implement internal procedures that will permit full compliance with the provisions of the Act, this Part and the Comptroller's SAMS manual.

 

b)         All State agencies must maintain written or electronic records reflecting the date or dates on which:

 

1)         the Goods were received and accepted or the Services were rendered;

 

2)         the Proper Bill was received by the State agency;

 

3)         approval for payment of a bill was given by the Agency;

 

4)         a Vendor bill was disapproved, in whole or in part, based upon a defect or what the State agency believes to be a defeat; and

 

5)         the payment was issued by the Comptroller's Office.

 

(Source:  Amended at 26 Ill. Reg. 14666, effective September 19, 2002)

 

Section 900.35  Duties of State Agencies: Interest Payments

 

a)         Interest penalty payments must be processed on a voucher, separate from the voucher the State agency submits for payment of the bill, payable to the Vendor. The voucher submitted for payment of the interest penalty shall include the date from which the interest penalty is calculated, the date of payment of the bill, and the voucher number of the voucher submitted by the Agency for payment of the bill.

 

b)         Interest penalty payments must be charged to the same expenditure authority account to which the related Goods or Services were charged, and indicate the detail object code for interest payable under the Act as specified in the SAMS manual. If the payment for Goods or Services was charged to an appropriation that has since been reappropriated, the interest penalty payment must be charged to the reappropriation.

 

c)         In the event the appropriation originally charged for the Goods or Services is exhausted and not reappropriated, the State agency shall, if authorized by law, transfer and obligate funds into the proper appropriation pursuant to 30 ILCS 105/13.2 for payment of the interest penalty.

 

d)         In the event the appropriation originally charged with the Goods or Services is exhausted and the State agency has exhausted its transfer of funds authority pursuant to 30 ILCS 105/13.2, the appropriation has lapsed or the agency has improperly refused to pay interest, Vendors may have recourse before the Court of Claims for payment of interest penalties.

 

e)         An interest penalty payment shall be deemed an outstanding liability of the fiscal year during which the contract for the Goods or Services giving rise to the interest penalty was entered.

 

f)         Upon receipt of a Vendor's written request or statement for the interest penalty, the State agency must respond to the Vendor's request within 60 days if the interest penalty is not appropriate under the Act, this Part, or the Comptroller's SAMS manual, along with the reason why the interest penalty will not be paid.  If requests for interest should be presented to the Court of Claims, that requirement should be communicated to the Vendor.

 

(Source:  Added at 26 Ill. Reg. 14666, effective September 19, 2002)

 

Section 900.40  Statement Indicating That Interest Penalty May Be Available

 

a)         The remittance advice of each commercial payment must contain the following statement or words of similar meaning:

"Payment of interest may be available if the State fails to comply with the State Prompt Payment Act [30 ILCS 540]."

 

b)         In the case of electronic payments, the statement may be transmitted electronically or otherwise reflected within the information authorizing electronic payments.

 

(Source:  Amended at 26 Ill. Reg. 14666, effective September 19, 2002)

 

Section 900.50  Other Interest Provisions

 

No agency may enter into a contract with a late payment interest provision more generous to the vendor than that provided in this Part.

 

Section 900.60  When a Payment is Late

 

For bills payable from funds appropriated prior to FY03, a payment is late if the Date of Payment is not within 60 days after the Date of Approval of the Vendor's bill.  For bills payable from funds appropriated on and after July 1, 2002, a payment is late if the Date of Payment is not within 60 days after the receipt of a Proper Bill. For bills payable from funds appropriated on and after December 28, 2012, a payment is late if the Date of Payment is not within 90 days after the receipt of a Proper Bill.

 

(Source:  Amended at 40 Ill. Reg. 13831, effective September 26, 2016)

 

Section 900.70  Approval by the State

 

a)         A State agency shall review in a timely manner each bill after its receipt to determine if the bill is a Proper Bill.  A bill is not a Proper Bill if it contains one of the following defects:

 

1)         lacks sufficient and/or correct information required by the agency to process the bill;

 

2)         lacks the Vendor's taxpayer identification number or a completed Internal Revenue Service Form W-9 or Form 147C certifying that the Vendor's taxpayer identification number has been applied for but not received and the Vendor is not subject to backup withholding due to underreporting; or

 

3)         is directed to an address or person other than the one designated in written instructions from the State.

 

b)         An agency shall approve Proper Bills or deny bills with defects, in whole or in part, within 30 days after receipt.  Vendor bills denied during this 30 day period shall be assigned a new Date of Receipt when a corresponding Proper Bill is subsequently received.

 

c)         The State agency shall notify the Vendor upon the discovery of a defect, as soon as possible.  The notification shall indicate the nature of the defect and any additional information necessary to correct the defect.  The notification may be verbal or in writing, as the agency may determine is appropriate given the circumstances surrounding the payment and the nature of the defect in the bill.  The State agency shall maintain adequate documentation of all such notifications and subsequent agency and Vendor actions so as to determine when and from what date late payment interest is due and to resolve any related Vendor disputes.

 

d)         If a Vendor bill is approved, in whole or in part, after the required 30 day period to approve or deny bills, late payment interest shall be due for the approved portion of the bill if the Date of Payment is not within 90 days after receipt of the Proper Bill or part of the bill, except as to bills payable from funds appropriated prior to December 28, 2012, in which case late payment interest shall be due for the approved portion of the bill if the Date of Payment is not within 60 days after receipt of the Proper Bill or part of the bill.

 

e)         If a Vendor bill is denied, in whole or in part, after the required 30 day period to approve or deny bills and the denied bill or part of bill is subsequently approved for payment as originally submitted and denied, late payment interest shall be due for the approved portion of the bill if the Date of Payment is not within 90 days after original receipt of the Proper Bill or part of the bill, except as to bills payable from funds appropriated prior to December 28, 2012, in which case late payment interest shall be due for the approved portion of the bill if the Date of Payment is not within 60 days after receipt of the Proper Bill or part of the bill. Vendor bills denied, in whole or in part, and not subsequently approved for payment as originally submitted and denied shall be assigned a new Date of Receipt when a Proper Bill is subsequently received.

 

f)         If the agency and the Vendor have not formally executed a contract and State law requires a written contract, any bills submitted before the formal execution shall be deemed to be received when the contract is executed.  State law allows payments to be made only after the formal contract is executed for Supplies or Services over $10,000 or Professional and Artistic Services over $5,000.

 

(Source:  Amended at 40 Ill. Reg. 13831, effective September 26, 2016)

 

Section 900.80  Submission and Receipt of Bills

 

a)         A bill submitted, lacking sufficient and/or correct information required by the State agency to process the bill, lacking taxpayer identification number, or to an address or person other than one designated in written instructions from the State shall not be considered a Proper Bill until it is completed, additional information provided, or it reaches the proper address or person.

 

b)         A bill submitted lacking the Vendor's federal taxpayer identification number shall not be considered a Proper Bill until the Vendor provides the taxpayer identification number or a completed Internal Revenue Service Form W-9 or Form 147C certifying that the Vendor's taxpayer identification number has been applied for but not received and that the Vendor is not subject to backup withholding due to underreporting.

 

c)         A bill received prior to acceptance of Goods or Services by the State shall be considered a Proper Bill no earlier than the date of acceptance.  Acceptance means the date on which the State, to the best of its ability at that time, determines contract requirements have been met.  Acceptance for late payment calculation shall not be used by any Vendor to show acceptance of the Goods or Services for any other purpose.

 

d)         A bill received after acceptance of Goods or Services may be considered a Proper Bill no earlier than the date of receipt of the bill.

 

e)         A Vendor may submit bills for future performance, such as to make lease or installment purchase payments, in advance of scheduled due dates, but such bills for purposes of this Part shall not be considered received by the State any earlier than when the future performance by the vendor begins.

 

f)         When the parties do not contemplate submission of a physical bill to the State, such as to make scheduled payments per the terms of a contract, the date of final receipt or acceptance, whichever is later, of the Goods or Services shall be considered the date of the bill.

 

g)         State employees who are reimbursed by the State for their travel may receive late payment interest in accordance with this Part.

 

(Source:  Amended at 26 Ill. Reg. 14666, effective September 19, 2002)

 

Section 900.90  When and How Vendors Must Request Interest

 

a)         Interest amounting to $50 or more need not be requested by a Vendor. Agencies are responsible for calculating and paying such interest and are to do so within a reasonable time.

 

b)         Interest amounting to $5 but less than $50 must be requested by the Vendor.

 

1)         The Vendor must submit a written statement to the appropriate State agency specifically requesting the State agency to pay an interest penalty to the Vendor.

 

2)         The statement must include a description of the original transaction, the Vendor's taxpayer identification number, the date of the Vendor's invoice, the invoice amount and the date the bill was presented to the Agency.

 

3)         The statement should, if possible, include the Vendor's invoice number, the voucher number, the appropriation account code, the obligation number, the exact name of the Vendor or payee as the name appeared on the payment warrant, an estimate of the date upon which the interest penalty begins to accrue and any other information reasonably needed by the State agency to verify the interest penalty payment.

 

4)         A request for the late payment interest penalty should be submitted within 90 days after the Date of Payment.

 

5)         Agencies are responsible for paying such interest and are to do so within a reasonable time.

 

6)         Upon written request by the Vendor, an agency must disclose to the Vendor the date upon which an interest penalty begins to accrue.

 

c)         Interest amounting to less than $5 will not be paid by the State, except in relation to a request that results from the application of the provisions of this Part to claims for prescription services submitted pursuant to Article V of the Public Aid Code [305 ILCS 5/Art. V], covering ALL KIDS Health Insurance Act [215 ILCS 170] and the Children's Health Insurance Program Act [215 ILCS 106] by a pharmacy to the Department of Healthcare and Family Services.

 

d)         Interest is to be calculated for each individual Vendor bill received. A determination of whether an interest penalty is owed is to be made for each individual bill and may not be based upon summing interest from two or more bills together.  If a State agency divides a Vendor bill into parts for payment from multiple funding sources, interest is to be calculated for each individual part in order to determine if interest is owed for that part of that bill.

 

(Source:  Amended at 31 Ill. Reg. 5751, effective March 29, 2007)

 

 

Section 900.100  Calculation of Interest

 

a)         Interest is calculated at the rate of 1% per month.  This results in a daily interest factor of .00033 (01/30).

 

b)         For each day payment is late, the amount late shall be multiplied by the daily interest factor to determine the late payment charge.

 

c)         The interest penalty shall be simple interest and not compound interest, meaning that the interest penalty is computed on the amount of the bill only and shall not include previously accrued interest.

 

d)         For bills payable from funds appropriated on and after December 28, 2012, interest shall begin accruing on the 91^st day after receipt of a Proper Bill and shall continue to accrue until the bill is paid by the Comptroller's Office. For bills payable from funds appropriated prior to December 28, 2012, interest shall begin accruing on the 61^st day after receipt of a Proper Bill and shall continue to accrue until the bill is paid by the Comptroller's Office. 

 

e)         Interest shall not accrue on the Date of Payment.  In the event the Date of Payment is the same date that interest begins to accrue, there shall be no interest payable by the State for purposes of efficiency to the State.

 

(Source:  Amended at 40 Ill. Reg. 13831, effective September 26, 2016)

 

Section 900.110  No Interest on Interest

 

A request for payment of interest under this Act is not considered a bill and, therefore, not subject to the provisions of the Act; interest is not paid on an interest payment.

 

(Source:  Amended at 26 Ill. Reg. 14666, effective September 19, 2002)

 

Section 900.120  Exclusions

 

The following non-exhaustive list represents the types of payments that are excluded from the Act and consequently do not qualify for interest penalties:

 

a)         Inter- and intra-agency payments.  This includes transfers and payments to revolving funds, reimbursement of petty cash funds and imprest accounts, inter-fund transfers and inter-fund payments in which an agency or department serves as the Vendor of Goods or Services.

 

b)         Payments to State employees for personal services (salary only and not including health insurance benefits).

 

c)         Awards and grants, as defined by the Comptroller's Office in SAMS Manual Procedure 15, including pass-through grants and distributive payments and refunds.

 

d)         Contract retainers associated with construction contracts.

 

e)         State Board of Education categorical grants.

 

f)         Community College Board grants.

 

g)         Illinois Student Assistance Commission grants.

 

h)         Payments to local government entities, including school districts.

 

i)          Payments of interest penalties.

 

j)          Payments made to contractual employees (these payments are generally made via a Contractual Services Payroll Voucher).

           

k)         Payments from accounts or funds not appropriated by the General Assembly.

 

l)          Gratuitous payments made to induce a business to remain in or to locate in this State.

 

m)        Any type of payment to a Vendor assigned or sold by that Vendor to a different payee (including any assignments or sales made by the vendors to the Department of Healthcare and Family Services), except for assignments or sales made pursuant to a vendor payment program approved by the Department of Central Management Services and the Comptroller.

 

n)         Barter transactions.

 

o)         Payments made by a State agency comprised of federal funds only and no State or local funds.

 

p)         Medical and claims payments under the Workers' Compensation [820 ILCS 305] and Workers' Occupational Diseases [820 ILCS 310] Acts.

 

q)         Tax refunds.

 

r)          State Employee's Group Insurance Program payments covered by late payment interest provisions in Sections 368a and 370a of the Illinois Insurance Code [215 ILCS 5].

 

(Source:  Amended at 40 Ill. Reg. 13831, effective September 26, 2016)

 

Section 900.125  Vendor Payment Program

 

The requirements set forth in this Section establish the criteria for participation by participating vendors and qualified purchasers in a vendor payment program.  Information regarding the program may be found at http://www.payments.illinois.gov.

 

a)         Authority.  The State Comptroller and the Department are authorized to establish and implement the program pursuant to Section 3-3 of the Prompt Payment Act.

 

b)         Applicability.  This Section applies to all qualified accounts receivable not otherwise excluded from receiving prompt payment interest pursuant to Section 900.120.  Section 900.125 shall not apply to the purchase of any accounts receivable related to payments made under a medical assistance program, including Medicaid payments, or any other purchase of accounts receivable that is otherwise prohibited by law.

 

c)         Definitions

 

"Applicant" is any entity seeking to be designated as a qualified purchaser.

 

"Application Period" is the time period when the program is accepting applications as determined by the Department.

 

"Assigned Penalties" are penalties payable by the State in accordance with the Prompt Payment Act and this Part that are assigned to the qualified purchaser of an assigned receivable.

 

"Assigned Receivable" is the base invoice amount of a qualified account receivable and any associated assigned penalties due, currently and in the future, in accordance with the Prompt Payment Act.

 

"Assignment Agreement" is an agreement executed and delivered by a participating vendor and a qualified purchaser pursuant to which the participating vendor will assign one or more qualified accounts receivable to the qualified purchaser and make certain representations and warranties in respect thereof.

 

"Base Invoice Amount" is the unpaid principal amount of the invoice associated with an assigned receivable.

 

"Department" is the Department of Central Management Services.

 

"Medical Assistance Program" is any program which provides medical assistance pursuant to Article V of the Illinois Public Aid Code [305 ILCS 5/5], including Medicaid.

 

"Participating Vendor" is a vendor whose application for the sale of a qualified account receivable is accepted for purchase by a qualified purchaser pursuant to the program terms.

 

"Program" is a vendor payment program.

 

"Prompt Payment Act" is the State Prompt Payment Act [30 ILCS 540].

 

"Prompt Payment Penalties" are penalties payable by the State in accordance with the Prompt Payment Act and this Part.

 

"Purchase Price" is 100% of the base invoice amount associated with an assigned receivable minus:

 

•           any deductions against the assigned receivable arising from State offsets; and

 

•           if and to the extent exercised by a qualified purchaser, other deductions for amounts owed by the participating vendor to the qualified purchaser for State offsets applied against other accounts receivable assigned by the participating vendor to the qualified purchaser pursuant to the program.

 

"Qualified Account Receivable" is an account receivable due and payable by the State that is outstanding for 90 days or more, is eligible to accrue prompt payment penalties under the Prompt Payment Act and is verified by the relevant State agency.  A qualified account receivable shall not include any account receivable related to medical assistance program (including Medicaid) payments or any other accounts receivable, the transfer or assignment of which is prohibited by, or otherwise prevented by, applicable law.

 

"Qualified Purchaser" is any entity that, during any application period, is approved by the Department to participate in the program on the basis of certain qualifying criteria as determined by the Department.  

 

"State" is the State of Illinois.

 

"State Comptroller" is the Illinois Office of the Comptroller.

 

"State Offsets" is any amount deducted from payments made by the State in respect of any qualified account receivable due to the State's exercise of any offset or other contractual rights against a participating vendor. For the purpose of this Section, State offsets include statutorily required administrative fees imposed pursuant to the State Comptroller Act [15 ILCS 405].

 

"Sub-Participant" is any individual or entity that intends to purchase assigned receivables, directly or indirectly, by or through an applicant or qualified purchaser for the purposes of the program.

 

"Sub-Participant Certification" is an instrument executed and delivered to the Department by a sub-participant pursuant to which the sub-participant certifies its agreement, among others, to be bound by the terms and conditions of the program as a condition to its participation in the program as a sub-participant.

 

d)         Criteria for a vendor payment program.

 

1)         Under the program, qualified purchasers may purchase from participating vendors certain qualified accounts receivable owed by the State to the participating vendors.  A participating vendor shall not simultaneously apply to sell the same qualified account receivable to more than one qualified purchaser. 

 

2)         In consideration of the payment of the purchase price, a participating vendor shall assign to the qualified purchaser all of its rights to payment of the qualified account receivable, including all current and future prompt payment penalties due relating to that qualified account receivable in accordance with the Prompt Payment Act.

 

e)         Criteria for vendor participation.  A vendor may apply to participate in the program if: 

 

1)         the vendor is owed an account receivable by the State for which prompt payment penalties have commenced accruing;

 

2)         the vendor's account receivable is eligible to accrue prompt payment penalty interest under the Prompt Payment Act;

 

3)         the vendor's account receivable is not for payments under a medical assistance program; and

 

4)         the vendor's account receivable is not prohibited by, or otherwise prevented by, applicable law from being transferred or assigned pursuant to this Section.

 

f)         Criteria for qualified purchasers.  Factors to be considered by the Department in determining qualification to be a qualified purchaser shall include but are not limited to:

 

1)         the qualified purchaser's agreement to commit a minimum purchase amount as established from time to time by the Department based upon the current needs of the program and the qualified purchaser's demonstrated ability to fund its commitment;

 

2)         the demonstrated ability of a qualified purchaser's sub-participants to fund their portions of a qualified purchaser's minimum purchase commitment;

 

3)         the ability of a qualified purchaser and its sub-participants to meet standards of responsibility substantially in accordance with the requirements of the Standards of Responsibility found in 44 Ill. Adm. Code 1.2046(b) (Government Contracts, Procurement, and Property Management);

 

4)         the agreement of each qualified purchaser, at its sole cost and expense, to administer and facilitate the operation of the program with respect to that qualified purchaser, including without limitation, assisting potential participating vendors with the application and assignment process;

 

5)         the agreement of each qualified purchaser, at its sole cost and expense, to establish a website that is determined by the Department to be sufficient to administer the program in accordance with the terms and conditions of the program;

 

6)         the agreement of each qualified purchaser, at its sole cost and expense, to market the program to potential participating vendors;

 

7)         the agreement of each qualified purchaser, at its sole cost and expense, to educate participating vendors about the benefits and risks associated with participation in the program;

 

8)         the agreement of each qualified purchaser, at its sole cost and expense, to deposit funds into, release funds from, and otherwise maintain all required accounts in accordance with the terms and conditions of the program.  Subject to the program terms, all required accounts shall be maintained and controlled by the qualified purchaser at the qualified purchaser's sole cost and at no cost, whether in the form of fees or otherwise, to the participating vendors;

 

9)         the agreement of each qualified purchaser, at its sole cost and expense, to submit a monthly written report, in both hard copy and Excel format, to the State Comptroller or its designee and the Department or its designee, within 10 days after the end of each month, which, unless otherwise specified by the Department, at a minimum, shall contain:

 

A)        a listing of each assigned receivable purchased by that qualified purchaser during the month, specifying the base invoice amount and invoice date of that assigned receivable and the name of the participating vendor, State contract number, voucher number and State agency associated with that assigned receivable;

 

B)        a listing of each assigned receivable with respect to which the qualified purchaser has received payment of the base invoice amount from the State during that month, including the amount of and date on which that payment was made and the name of the participating vendor, State contract number, voucher number, and State agency associated with the assigned receivable, and identifying the relevant application period for each assigned receivable;

 

C)        a listing of any payments of assigned penalties received from the State during the month, including the amount of and date on which the payment was made, the name of the participating vendor, the voucher number for the assigned penalty receivable, and the associated assigned receivable, including the State contract number, voucher number and State agency associated with the assigned receivable and identifying the relevant application period for each assigned receivable;

 

D)        the aggregate number and dollar value of assigned receivables purchased by the qualified purchaser from the date on which such qualified purchaser commenced participating in the program through the last day of the month;

 

E)        the aggregate number and dollar value of assigned receivables purchased by the qualified purchaser for which no payment by the State of the base invoice amount has yet been received, from the date on which the qualified purchaser commenced participating in the program through the last day of the month; and

 

F)         such other data as the State Comptroller and the Department may reasonably request from time to time.

 

10)       the agreement of each qualified purchaser to use its reasonable best efforts, and for any sub-participant to cause a qualified purchaser to use its reasonable best efforts, to diligently pursue receipt of assigned penalties associated with the assigned receivables, including, without limitation, by promptly notifying the relevant State agency that an assigned penalty is due and, if necessary, seeking payment of assigned penalties through the Illinois Court of Claims; and

 

11)       the agreement of each qualified purchaser and any sub-participant to use their reasonable best efforts to implement the program terms and to perform their obligations under the program in a timely fashion. 

 

g)         Right to review performance of qualified purchaser's obligations.

Each qualified purchaser's performance and implementation of its obligations under subsection (f) shall be subject to review by the Department and the State Comptroller at any time to confirm that the qualified purchaser is undertaking such obligations in a manner consistent with the terms and conditions of the program.  A qualified purchaser's failure to so perform its obligations including, without limitation, its obligations to diligently pursue receipt of assigned penalties associated with assigned receivables, shall be grounds for the Department and the State Comptroller to terminate the qualified purchaser's participation in the program in accordance with subsection (i) of this Section.  Any such termination shall be without prejudice to any rights a participating vendor may have against that qualified purchaser, in law or in equity, including without limitation, the right to enforce the terms of the assignment agreement and of the program against the qualified purchaser.

 

h)         Right to Review Sub-Participants.

 

1)         In determining whether any applicant shall be designated as a qualified purchaser, the Department shall have the right to review or approve sub-participants that intend to purchase assigned receivables, directly or indirectly, by or through the applicant.

 

2)         The Department reserves the right to reject or terminate the designation of any applicant as a qualified purchaser or require an applicant to exclude a proposed sub-participant in order to become or remain a qualified purchaser on the basis of a review, whether prior to or after the designation.

 

3)         Each applicant and each qualified purchaser has an affirmative obligation to promptly notify the Department of any change or proposed change in the identity of the sub-participants that it disclosed to the Department no later than 3 business days after that change. 

 

4)         Each sub-participant shall be required to execute a sub-participant certification that will be attached to the corresponding qualified purchaser designation.

 

5)         Sub-participants shall meet, at a minimum, the requirements of subsections (f)(2), (3), (10), and (11).

 

i)          Term and termination.

 

1)         The program shall commence in March 2011 and shall continue until terminated:

 

A)        by the State Comptroller, after consulting with the Department, by giving 10 days prior written notice to the Department and the qualified purchasers in the program;

 

B)        by the Department, after consulting with the State Comptroller, by giving 10 days prior written notice to the State Comptroller and the qualified purchasers in the program.

 

2)         In the event a qualified purchaser or sub-participant breaches or fails to meet any of the terms or conditions of the program, that qualified purchaser or sub-participant may be terminated from the program:

 

A)        by the State Comptroller, after consulting with the Department. The termination shall be effective immediately upon the State Comptroller giving written notice to the Department and the qualified purchaser or sub-participant; or

 

B)        by the Department, after consulting with the State Comptroller. The termination shall be effective immediately upon the Department giving written notice to the State Comptroller and the qualified purchaser or sub-participant.

 

3)         A qualified purchaser or sub-participant may terminate its participation in the program, solely with respect to its own participation in the program, in the event of any change to the Prompt Payment Act or this Part from the form that existed on the date that the qualified purchaser or the sub-participant, as applicable, submitted the necessary documentation for admission into the program if the change materially and adversely affects the qualified purchaser's or the sub-participant's ability to purchase and receive payment on receivables on the terms described in this Section.

 

4)         If the program, a qualified purchaser, or a sub-participant is terminated under subsection (i)(1) or (2), the program, qualified purchaser, or sub-participant may be reinstated only by written agreement of the State Comptroller and the Department.

 

5)         No termination under subsections (i)(1), (2), or (3) shall alter or affect the qualified purchaser's or sub-participant's obligations with respect to assigned receivables purchased by or through the qualified purchaser prior to the termination.

 

(Source:  Amended at 40 Ill. Reg. 13831, effective September 26, 2016)

 

Section 900.130  Special Rules and Procedures Regarding the Application of the Act to the State Employee's Group Insurance Program

 

For claims for payment related to the State Employee's Group Insurance Program the following applies:

 

a)         Late payment interest pertaining to health care payments may be made to and requested by a:

 

1)         Member – any person who receives benefits through the State Employees Group Insurance Act program and whose benefits are paid through the Health Insurance Reserve Fund.

 

2)         Vendor – any provider of health care to a member.

 

b)         The Date of Approval shall be the date the Department of Central Management Services approves the bill.  The approval date given by an Administrative Services Organization (ASO) is not approval for purposes of determining whether a payment is late.

 

c)         The Date of Payment of the claim to the member or Vendor shall be the later of the date on the check or the date DCMS instructs a claims administrator to make the payment; ordinarily, this date is referred to as the date the payment has been released.

 

d)         A request for interest must contain the following information to be processed:

 

1)         An Explanation of Benefits Form from the State's Administrative Services Organization.  A duplicate is available from the ASO if needed; or

 

2)         Name of employee/member and claimant

 

            Social Security number

 

            Date of Service

 

            Amount of claim

 

            Claim control number

 

e)         Interest shall be payable only to the designated payee indicated on the claim.  Ordinarily, the payee is the Vendor; however:

 

1)         if the payment of the claim has not been assigned to the Vendor by the member, interest may be requested by and paid to the member;

 

2)         if the Vendor is designated as the payee on the claim, the Vendor is entitled to any interest penalty due by the Act and the Vendor shall not charge the member interest on any unpaid balance of the claim;

 

3)         if payment of the claim is to be paid directly to the Vendor, and the member has paid any or all of the claim in advance of payment to the Vendor, the Vendor shall not charge the State or the member any late payment interest after the date the member made payment and shall so certify on its request for interest.

 

Section 900.140  Resolution of Disputes

 

In the event a situation arises which is not covered by this Part or the proper course of action is unclear, the Comptroller and the Director of the Department of Central Management Services or their designees shall meet to make determinations and, if necessary, suggest modifications to the rules to be adopted pursuant to Sections 5-40, 5-45 or 5-50 of the IAPA.  In any such determination, the interested parties will be given an opportunity to make their views known as a part of the decision making process.  The Comptroller and the Director of the Department of Central Management Services shall employ the following standards in making interpretations of this Part:

 

a)         fairness to the Vendor and to the State.

 

b)         avoidance of litigation.

 

c)         efficiency to the State.