Commercial Audits and Appeals White Paper - Part 2

Another avenue to pursue a commercial appeal is to make use of Michigan’s Patient’s Right to Independent Review Act (“PRIRA”).¹⁹ A statute originally enacted in 2000, PRIRA affords a “covered person,”²⁰ defined as a policyholder, subscriber, member, enrollee, or other individual participating in a health benefit plan,²¹ the right to request an external review of an adverse determination²² by a commercial carrier, referred to as a “health carrier” in PRIRA.²³ PRIRA provides the covered person the opportunity for review of the written record by an independent review organization (“IRO”), which makes a recommendation to the Director of the Department of Insurance and Financial Services.²⁴ While the external review is on a written record and does not allow an opportunity for oral advocacy to the IRO or the Director, it provides essentially a de novo review since by statute the reviewing entity is not bound by any decisions or conclusions of the health carrier’s utilization review process or internal grievance process.²⁵

PRIRA requires that a commercial carrier give proper notice to a covered person of his right to request external review. At the time the commercial carrier sends written notice of the adverse determination to the covered person, it must provide written notice of the internal grievance and external review processes.²⁶ The written notice of the right to request an external review of an adverse determination issued before the service is provided must include several elements.²⁷ For example, the notice must inform the covered person of the ability under certain conditions to file a request for expedited external review at the same time the covered person files a request for expedited internal grievance.²⁸ It also has to inform the covered person that if the health carrier has not timely issued a written decision or agreed to a delay, the covered person may file the request for external review and be considered to have exhausted the internal grievance process.²⁹ Third, the covered person must be notified that the health carrier may waive its internal grievance process and the exhaustion requirement.³⁰ Fourth, the notice must state that the internal grievance process is considered exhausted if the health carrier fails to comply with the requirements of the process, unless that failure are based on de minimis violations that do not cause, and are not likely to cause, prejudice or harm to the covered person. MCL 550.1907(3)(a)(iv). In addition to this information, the written notice must include a copy of the description of both the standard and expedited external review procedures that highlights the covered person’s opportunity to submit additional information in the external review process and includes any forms used to process and external review.³¹ Included with any forms provided with the written notice must be an authorization form or other document approved by the Director that allows the covered person to authorize the health carrier and health care provider to disclose protected health information³² and medical records that are pertinent to the external review.³³

PRIRA grants a cover person the right to request external review of an adverse determination if the covered person has exhausted the health carrier’s internal grievance process or if the exhaustion requirement is waived under circumstances outlined in PRIRA.³⁴ After December 31, 2016, within 120 days after date of receipt of a notice of an adverse determination, the covered person may file the request for external review.³⁵ Except for requests for expedited review, all external review requests must be made in writing.³⁶ The Director must conduct a preliminary review of the request within 5 business days of receiving the request.³⁷ This preliminary review confirms: (1) whether the individual is or was a covered person in the health benefit plan at the time the health care service³⁸ was requested or, if the request involves a retrospective review, was a covered person at the time the health care service was provided; (2) whether the health care service reasonably appears to be a covered service under the health benefit plan; (3) whether the covered person has exhausted the internal grievance process, unless exhaustion is not required; (4) whether the covered person has provided all the information and forms required by the Director that are necessary to process an external review, including a health information release form; and (5) whether the health care service appears to involve issues of medical necessity or clinical review criteria.³⁹

After conducting the preliminary review, the Director must immediately provide written notice to the covered person whether the request is complete and whether it has been accepted for external review.⁴⁰ If the request is accepted, the written notice to the covered person must include a statement that the covered person has 7 business days following the date of the notice to submit any additional information and supporting documentation that the reviewing entity will consider during the external review.⁴¹ The Director must also immediately notify the health carrier in writing of the acceptance of the request for external review.⁴² If the request is not accepted due to incompleteness, the Director is required to notify the covered person of the information needed to complete the request, and the covered person has 30 days from the date of receipt of the notification to provide the needed information.⁴³ If the Director does not accept the request, the written notice rejecting the request must state the reasons it was not accepted.⁴⁴

Depending on the nature of the adverse determination, it will be reviewed either by an IRO or by the Director.⁴⁵ Where the request for external review appears to involve issues of medical necessity or clinical review criteria, the Director must assign review to an approved IRO at the time the request is accepted for external review.⁴⁶ The IRO will provide the Director with a written recommendation whether to uphold or reverse the adverse determination, in accordance with the process outlined below.⁴⁷

If the Director accepts the request and it appears to only involve purely contractual provisions such as covered benefits or accuracy of coding and not issues of medical necessity, the Director may at her option, assign an IRO or keep the request and conduct the external review herself.⁴⁸ If the latter, the Director is required to follow the same statutory time frames and procedural requirements imposed on the IRO.⁴⁹ The Director is required to assign the request immediately to an IRO, even if she initially decided to review the request, if at any time during her review she determines that the request involves issues of medical necessity.⁵⁰

Within 7 business days of the health carrier receiving the notice of acceptance of a request for external review referred to above, the health carrier or its designee utilization review organization⁵¹ is required to provide the reviewing entity the documents and any information that was considered in making the adverse determination.⁵² Failure to timely provide this information will not delay the external review.⁵³ If the IRO notifies the Director that the health carrier or its designee utilization review organization has failed to timely provide this information, the Director may terminate the external review and make a decision to reverse the adverse determination and immediately notify the IRO, the covered person, and the health carrier of the decision.⁵⁴ At any time during the external review process, the health carrier is permitted to reconsider its adverse determination.⁵⁵ Its reconsideration will not delay or terminate the external review process.⁵⁶ If the health carrier decides to reverses its decision, it must immediately notify in writing the covered person, the IRO, and the Director of its decision, and upon receipt of the notice the reviewing entity will terminate its review.⁵⁷

In the review process, the reviewing entity is required to review all of the information received from the health carrier and any information provided by the covered person.⁵⁸ As noted earlier, it is not bound by any decisions or conclusions of the health carrier’s utilization review process or internal grievance process.⁵⁹ It may also consider, if appropriate and available, other sources of information.⁶⁰ This includes (1) the covered person’s pertinent medical records, (2) the attending health care professional’s recommendation, (3) consulting reports from appropriate health care professionals and other documents submitted by the health carrier or the covered person, (4) the terms of coverage under the covered person’s health benefit plan, (5) the most appropriate practice guidelines, such as generally accepted practice guidelines, evidence-based practice guidelines, or any other practice guidelines developed by the federal government or national or professional medical societies, boards, and associations, and (5) any applicable clinical review criteria developed and used by the health carrier or its designee utilization review organization.⁶¹

The IRO must provide its recommendation to the Director within 14 days after its assignment by the Director.⁶² The recommendation must include a number of required elements, including (1) a general description of the reason for the request for external review; (2) the date the IRO received the assignment from the director to conduct the external review; (3) the date the external review was conducted; (4) the date of the IRO’s recommendation; (5) the principal reason or reasons for its recommendation; (6) the rationale for its recommendation; (7) references to the evidence or documentation, including the practice guidelines, considered in reaching the recommendation.⁶³ Immediately upon receipt of the IRO’s recommendation, the Director will review the recommendation to ensure it is not contrary to the terms of coverage under the health benefit plan.⁶⁴

The Director, within 7 business days of receipt of the IRO’s recommendation, must also provide written notice to the covered person of her decision to uphold or reverse the adverse determination.⁶⁵ Included in the notice must be the principal reason or reasons for the decision along with the information provided by the IRO in its recommendation.⁶⁶ If relevant, the notice must articulate the principal reason or reasons why the director did not follow the IRO’s recommendation.⁶⁷ The health carrier must immediately approve coverage upon receipt of the Director’s written notice, if the Director’s notice reversed the adverse determination.⁶⁸

PRIRA gives special attention to requests for external review that involve issues of experimental or investigational services or treatments.⁶⁹ For requests for external review involving these issues, during the preliminary review process the Director must make a number of important determinations.⁷⁰ In addition to the general considerations discussed earlier, she must consider whether the service is a covered benefit under the health benefit plan except for the health carrier’s determination that the service or treatment is experimental or investigational.⁷¹ The Director must determine that the service is not explicitly listed as an excluded benefit under the health benefit plan.⁷² Next, she will evaluate whether the covered person’s treating provider has certified one or more of the following: (1) that standard health care services or treatments have not been effective in improving the condition of the covered person; (2) that standard services or treatments are not medically appropriate, or (3) there is no available standard health care service or treatment covered by the health carrier that is more beneficial than the recommended or requested health care service.⁷³ The request also must include evidence that the treating provider has either: (1) recommended a health care service or treatment that the treating provider certifies in writing is likely to be more beneficial to the covered person, in the provider’s opinion, than any available standard service or treatment, or (2) if the treating provider is a licensed, board certified or board eligible physician qualified to practice in the area of medicine appropriate to treat the covered person’s condition, certified in writing that scientifically valid studies using accepted protocols demonstrate that the service or treatment is likely to be more beneficial than any available standard service or treatment.⁷⁴

When the IRO provides its written recommendation involving issues of experimental or investigational services or treatments, there are items it must additionally consider under PRIRA.⁷⁵ It must consider if the FDA has approved the requested or recommended service or treatment for the condition.⁷⁶ It must also consider if medical or scientific evidence or evidence-based standards demonstrate that the expected benefits of the recommended or requested service or treatment “are more likely than not to be more beneficial to the covered person” than the benefits of any available standard health care service or treatment, and that the adverse risks of the recommended or requested service or treatment would not be substantially increased over those of available standard health care services or treatments.⁷⁷ “Medical or scientific evidence” and “evidence-based standards” are both terms defined by PRIRA. The former definition contains an extensive list of categories of acceptable sources that includes evidence found in sources such as published peer-reviewed scientific studies, peer-reviewed medical literature, and standard reference compendia.⁷⁸ The latter is defined as “the conscientious, explicit, and judicious use of the current best evidence based on the overall systematic review of the research in making decisions about the care of individual patients.”⁷⁹ When framing a request for external review involving an issue of experimental or investigational service, it is important to consider what evidence can be compiled to support the services and whether it satisfies these statutory standards.