ARA Financial Services LLC

In 2009 Payers started to require Peer Reviews within a day of, rather than 3 days after, an admission. They then imposed a time period within which physicians must call back, otherwise there was no Peer or Expedited Review with your physician and only the data your UR staff had provided them. Here are some of the more outrageous strategies I have seen in 2010 and currently being expanded:
Watered Down Appeal ResponsesFor quite some time, Value Options has provided meaningless appeal responses using generic statements of the patient not meeting selected criteria, but not making reference to the specifics in the appeal and the criteria that were met. This is a growing pattern with Payers’ responses. When there is no supportable basis for a denial you will get something like Value Options generic “Treatment planning is not individualized and/or appropriate to the individual’s condition…” with no explanation of what is meant by this. When you challenge this as not being a clinical rationale the spin you get is that this statement “addresses the relationship between the individual’s condition and the treatment plan” and claims that this justifies it as a clinical rationale.

Recently we saw a UBH Evercare denial stating that a patient was denied for no longer having “suicidal ideation which was the primary reason for admission.” However, there were several justifications provided in the appeal including homicidal ideation and unresolved issues in this adolescent’s home that were triggers to her anger that the response failed to acknowledge. The catch-all criterion for Evercare is that “The treatment being provided is appropriate…” which they claim to not have been met but offer no specific examples of this. These are simply subjective and meaningless responses that must be challenged.

What should you expect in response to your appeals? In 2001 the Attorney General for the State of NY defined the State’s utilization laws in an action involving six Managed Care Organizations.

A statement of Reasons and Clinical Rationale must demonstrate that the UR Agent made an individualized medical assessment of the Enrollee by referring to the specific medical data relating to the Enrollee, which the Clinical Peer Reviewer took into consideration when making the Adverse Determination. Merely stating that the service at issue is not medically necessary is not sufficient, nor is a statement that the proposed service does not meet the UR Agent's criteria. A statement of Reasons and Clinical Rationale must be sufficiently specific to enable the Enrollee and/or the Enrollee's health care provider to make an informed decision about whether or not to appeal the Adverse Determination and to determine the issue or issues to address in the appeal.

What advantages do these boiler-plate generic responses provide the payers?
It delays the determination on your appeal, and therefore any payment due you.
They count on the additional requirements and the fear of lost referrals to result in many appeals being dropped from further action.
They count on the fact that this adds more work for your already overworked staff to complete within their self-serving timeliness deadlines, and therefore more appeals are denied.
They can require a new request form to be signed by patients they know may be hard to contact and harder to get to act on when a reversal of a denial frequently means the patients will have a greater coinsurance liability.

What are the most common items missing in these Payers’ denials that are required by Federal and most State regulations?
Disclosure of clinical rationale used in making decision
Disclosure of qualifying credentials of reviewer
Disclosure of evidence or documentation used in decision
Description of the procedures, timeframes, and consumer rights for grievance and appeal.
Response to the specific medical evidence provided and/or other appeal issues.

End of Expedited Appeals
At the same time we are seeing watered down appeal responses, Payers are forcing hospitals to do away with expedited appeals. How are they doing this? The rules are being changed by many Payers to provide only one “Internal” appeal and this past year have added the “expedited appeal” as your one and only internal appeal for certain plans. Who is doing this? So far I seen this employed by American Psychiatric Solutions (APS) for United Family Services, Healthsprings for contracted Medicare providers, and Integrated Mental Health Systems (IMHS).

The disadvantages of conducting an expedited appeal is that you are reliant on your attending physician to have the time, inclination and insurance plan criteria sufficient to defend his/her necessity of continued care against administrative physicians hired to deny that care. You have no written clinical rationale telling you why they denied the care and probably don’t have any opportunity to prepare the physician for each different set of criteria that may be used, etc. There are two options:
Prepare to have your staff do the expedited appeals with your physician conferenced-in or in their place. Know the criteria for the plan and lay out the specific chart examples of how these are being met before the call is made. Have the physician review these and add more support if applicable.
Refuse the expedited appeal, but create a form for UR to get the details of the denial in writing with the names, dates and times as well as the credentials of all payer's staff involved in the denial. Get as much clinical data as possible from them. The advantage is that you now have time to gather the data to support and submit with your one internal appeal.

THE REALITY
Insurance companies know that the budget cuts for State agencies that provide Insurance oversight is taking place at the same time that the Payers have to cut their bids to get Plan contracts. So they cut costs through increased denials, reduced internal appeals, etc. knowing that the State agencies oversight is virtually non-existent.