“Medical necessity” is considered
a collective term for determinations based on medical necessity, appropriate
level of care, custodial care (as these terms are defined in
32 CFR 199.2), or other reason relative solely
to reasonableness, necessity or appropriateness. Determinations
relating to mental health benefits under
32 CFR 199.4 are considered medical necessity
determinations. For pharmacy claims, a determination regarding pharmaceuticals
prescribed outside the guidelines issued by the Department of Defense
Pharmacy and Therapeutics (DoD P&T) Committee is not considered
a medical necessity determination, even when the determination is
based on medical review. Such determination is a factual determination
and should be processed in accordance with
Section 5.
Medical necessity determinations may be performed
when a pharmaceutical has been denied under the Pharmacy Benefits
Program. Examples of medical necessity determinations include, but
are not limited to:
• Whether
medical necessity substantiates providing a beneficiary a non-formulary pharmaceutical
or supply at the formulary copay;
• Where prior authorization is required for
a designated pharmaceutical, whether supporting documentation supports
authorization of the pharmaceutical; and
• Where the pharmaceutical is dispensed in accordance
with the formulary, but retrospectively found to be not medically
necessary for a specific diagnosis.
1.0 Initial
Determination
A determination issued (following
review by a second level reviewer) that concludes that the health
care services furnished or proposed to be furnished to a patient
are not medically necessary is an initial denial determination and
is appealable under this section.
1.1 Opportunity For Discussion
Of Proposed Denial Determination In Preadmission/Preprocedure And
Concurrent Review Cases
In preadmission/preprocedure
and concurrent review cases, the contractor shall provide an opportunity
to discuss a proposed initial denial determination. Before issuing
an initial denial determination, the contractor shall:
• Promptly
notify the provider or supplier and the patient’s attending physician
(or other attending health care practitioner) of the proposed determination.
• Afford an opportunity
for the provider or supplier and the physician (or other attending health
care practitioner) to discuss the matter with the contractor physician
advisor and to explain the nature of the patient’s need for health
care services, including all factors which preclude treatment of
the patient as an outpatient or in an alternative level of inpatient care.
• Record each successful
and unsuccessful contact with a provider, which record must include
the date and time, person contacted, context of conversation, and
contractor personnel who participated in the contact.
1.2
Notice
of Initial Denial Determination
The notice
of the initial determination shall, where applicable, address waiver
of liability for services found to be not medically necessary and
include notice of appropriate appeal rights. (Refer to
Section 1, paragraph 3.1 for the content of
the notice of initial determination.) If the provider was verbally
notified of the initial determination prior to issuance of the written
initial determination, the time and date of the verbal notification
shall be included in the Notice of the Initial Determination. The contractor
shall provide written Notice of an Initial Determination to:
• The
patient, unless the patient is represented by a guardian or other
representative. If the patient is represented by a guardian or other
representative, then the notice will be addressed and provided to
the guardian or representative.
• The attending non-network
participating physician, or other non-network participating health
care provider.
• The
facility, if one is involved.
1.3 Timing Of
The Notice
The contractor shall ensure written
notices of initial and appeal determinations are delivered in accordance
with the TRICARE processing standards described in
Chapter 1, Section 3. Reference
paragraph 1.2 regarding
beneficiaries represented by guardians or other representatives.
If the beneficiary is represented in the appeal, the notice must
be delivered to the beneficiary’s representative, or, in the case
of a minor beneficiary, to the parent or guardian of the minor beneficiary unless
the claim was filed by the minor beneficiary. If the beneficiary
is an inpatient, and is not a minor or represented, notices must
be delivered to the beneficiary in the facility.
1.4 Preadmission/Preprocedure
Review
In the case of preadmission review,
the contractor shall document the date that the patient (or representative)
and the facility received notice of the initial denial determination.
If notice to the provider was verbal, the date and time of the verbal
notice, the method by which verbal notice was given (e.g., telephone),
and to whom and by whom the verbal notice was given, must be documented.
1.5 Effect Of
The Initial Denial Determination
The initial
determination is final and binding unless the initial determination
is reopened by the contractor or revised upon appeal.
2.0
Contractor
Reconsiderations
The contractor shall develop
a written plan for and implement a formal appeals system that incorporates
the requirements for reconsiderations of initial denial determinations.
The opportunity for reconsideration shall be stated in the contractor’s
initial denial determination regarding the medical necessity, reasonableness
or appropriateness of admission, continued stay, outlier days, and/or
services rendered.
2.1 Right
To Contractor Reconsideration
The contractor
shall establish procedures to ensure a beneficiary (or representative)
and non-network participating provider are notified in the initial
denial notice of their right to a reconsideration of a contractor’s
initial denial determination (refer to
Section 1, paragraph 3.1). These parties may request
a reconsideration if there is an amount in dispute, regardless of
the dollar amount in controversy. The following issues are subject
to reconsideration if either the beneficiary and/or provider is
dissatisfied with an initial denial determination:
• Reasonableness,
medical necessity and appropriateness of the services furnished
or proposed to be furnished.
• Appropriateness of
the setting in which the services were or are proposed to be furnished.
• Whether the party
is financially liable. The beneficiary who has been found liable
may obtain a reconsideration of that determination. A provider may
obtain a reconsideration of the determination whether the beneficiary
is or is not liable. If a beneficiary or provider requests a reconsideration
of the issues in the above paragraphs, the contractor shall make a
determination of the limitation of liability issue at the same time.
2.2 Request For
Contractor Reconsideration
The contractor
shall allow a beneficiary (or representative) and/or non-network
participating provider to submit a written request for reconsideration
to the contractor. The following limitations apply:
• Only
a beneficiary (or appointed representative) may submit a written
request for an expedited reconsideration of preadmission/preprocedure.
• When continued certification
is denied during concurrent review, and the beneficiary is still in
the facility, only the beneficiary (or appointed representative)
may request a reconsideration.
• A beneficiary or a
non-network participating provider may request a nonexpedited reconsideration.
2.3 Time Frames
For Reconsideration Requests
The contractor
shall reconsider an initial denial determination if a written request
is made by an appropriate appealing party within the following time
frames:
2.3.1 Concurrent
Review Denial
In order to file a request
for reconsideration of a concurrent review denial determination, the
beneficiary must be a patient in the facility on the date of appeal
filing. The beneficiary is encouraged to file no later than noon
of the day following the day of receipt of the initial denial determination.
The date of receipt of the initial determination by the beneficiary
shall be considered to be five calendar days after the date of the
initial determination, unless the receipt date is documented. A
request for reconsideration received after the reconsideration filing
deadline for concurrent review, but which is postmarked or received
within 90 calendar days from the date of the initial determination, shall
be accepted. The contractor shall forward the concurrent review
request to the TRICARE Quality Management Contract (TQMC) contractor
for a reconsideration determination on the date the contractor receives
the request. (Refer to
paragraph 2.6.2.) An initial determination
that denies services already provided is not considered a concurrent
review denial, but is a retrospective review denial.
2.3.2
Preadmission/Preprocedure
Denial
A request for an expedited reconsideration
of a preadmission/preprocedure denial must be filed by the beneficiary
within three calendar days after the date of the receipt of the
initial denial determination. The date of receipt of the request
for reconsideration shall be considered to be five calendar days
after the date of the initial denial determination, unless the receipt
date is documented. Appeals filed after the expedited appeal filing
deadline will be treated as nonexpedited appeals. In situations
where the preadmission/preprocedure appeal is treated as nonexpedited,
it is imperative that the contractor obtain current status as to
the patient’s medical condition prior to issuing the reconsideration
determination, as the beneficiary’s condition may be ever changing.
If during the processing of an appeal of a preadmission/preprocedure
denial, the beneficiary received the denied service or supply, the
contractor shall obtain the medical records and treat the appeal
as nonexpedited.
2.4
Nonexpedited
Denial
All other requests for reconsideration
must be filed within 90 calendar days after the date of the initial
denial determination. The request shall be considered to be filed
as of the date the request is postmarked, or, if the request does
not have a postmark, or if the postmark is illegible, it shall be considered
filed on the date it is received by the contractor.
2.5 Contractor
Requirement To Provide Information
With the
exception of reconsiderations of concurrent review initial denial
determinations, which are conducted by the TQMC contractor, when
a reconsideration is requested and prior to the issuance of the
reconsideration determination, the contractor shall provide all
appealing parties an opportunity to examine and obtain documents
and information upon which the initial denial determination is made.
(Refer to
Section 3, paragraph 4.5 regarding contractor
information that shall be included in the appeal file provided to
Defense Health Agency (DHA).) All parties to the reconsideration
shall be informed that they may be charged the costs of photocopying
and postage as established by DHA. All parties shall be informed
of their opportunity to present documenting materials or additional
information for consideration.
2.6 Contractor Reconsideration
Proceedings
2.6.1 Other
Than Reconsiderations Of Concurrent Review Initial Denial Determinations
The contractor shall follow the following reconsideration
procedures:
• The contractor shall
give advance notice of the date that the reconsideration determination
will be issued to allow sufficient time for the preparation and
submission of additional information.
• The contractor shall
reschedule the reconsideration if a party submits a written request presenting
a reasonable justification for rescheduling.
• A reconsideration
determination shall be based on the information that led to the initial
determination, all information found in the medical record, and
additional information submitted by the beneficiary or provider.
If the beneficiary or provider fails to submit requested additional
documentation, the reconsideration determination will be based on
the available documentation.
• The beneficiary and/or
provider must present the additional information in writing.
• Parties shall be informed
that they will receive written notification of the reconsideration
determination after the contractor has reviewed the case.
2.6.2
Reconsiderations
Of Concurrent Review Initial Denial Determination
When
the beneficiary remains an inpatient and files a timely request
for a reconsideration, the contractor shall immediately notify the
TQMC contractor by telephone, facsimile, or e-mail on the date of
filing, and overnight mail to the TQMC contractor the complete medical
record and all supporting documentation regarding the initial denial
determination and any other documents provided by the beneficiary
and/or provider. Facsimiles may be utilized in the event the documentation is
not more than 10 pages in volume. The TQMC contractor shall review
the request for reconsideration and notify the contractor and all
parties of its decision regarding the request. (Refer to
paragraph 3.1.1.)
2.6.3 Timing Of
Contractor Determinations
The contractor
shall complete reconsideration determinations and send written notices
to the parties involved in accordance with the time frames set forth
in
Chapter 1, Section 3, paragraph 4.0.
2.6.4 Notice Of
Contractor Determination
The contractor shall
issue a written notice of the reconsideration determination. Refer
to
Section 3, paragraph 6.0 for the required
content of the notice to the appealing party of the results of the
reconsideration determination. Time frames for filing a request
for a reconsideration by the TQMC contractor are addressed in
Section 3, paragraph 6.2.8.1.
3.0 Reconsiderations
By The TQMC contractor
The TQMC contractor
is responsible for reviewing requests from beneficiaries and/or
providers for an appeal of a reconsideration when a contractor upholds
an initial denial determination on reconsideration. The TQMC contractor
is also responsible for issuing reconsideration determinations in concurrent
review cases. The time frames for reconsideration requests set forth
in
paragraphs 2.3.2 and
2.4 also apply to reconsideration
requests filed with the TQMC contractor.
3.1 Timing Of TQMC Contractor
Reconsideration Determinations
3.1.1
Reconsideration
Of Concurrent Review Initial Denial Determinations
The TQMC contractor shall complete a reconsideration
determination for a concurrent review initial denial determination
within two working days and shall notify all parties and the contractor
of the reconsideration determination within three working days after
the receipt of the reconsideration request from the contractor by
the TQMC contractor. The contractor shall automatically provide
to the TQMC contractor by facsimile, overnight mail, or e-mail,
all required documentation on the day of the receipt of the reconsideration
request. If the beneficiary is discharged while the concurrent review
is being performed by the TQMC contractor, the TQMC contractor will return
the case file to the contractor by overnight mail or e-mail with
a letter advising the contractor that because the beneficiary has
been discharged, a nonexpedited, retrospective reconsideration by the
contractor is appropriate. The TQMC contractor will notify the appealing
party, in writing, of the action taken. The contractor will accept
the case as a nonexpedited reconsideration with the reconsideration
receipt date being the date of receipt of the case file from the
TQMC contractor.
3.1.2
Reconsideration
Of A Preadmission/Preprocedure Reconsideration Denial Determinations
Within three working days of receipt of a request
from a beneficiary for an expedited reconsideration, the TQMC contractor
shall complete its review and notify all parties and the contractor of
the results of the review. The TQMC contractor shall request from
the contractor all documentation, including the medical record,
regarding the initial denial and reconsideration determination.
The contractor shall provide all requested documentation by overnight
mail or facsimile. If, during the processing of an appeal of a preadmission/preprocedure
denial, the beneficiary receives the denied services or supplies,
the TQMC contractor shall obtain the medical record and treat the
appeal as nonexpedited.
3.1.3 Non-Expedited Reconsiderations
The TQMC contractor shall complete reviews
for all other requests for appeals of reconsideration denial determinations
made by the contractor and notify all parties within 30 calendar days
after the date of receipt of the reconsideration request. The TQMC
contractor shall request from the contractor all documentation,
including the medical record, regarding the initial denial and reconsideration
determination within one day of receipt of the request for reconsideration.
The contractor shall provide all requested documentation within
five working days.
3.2 Notice
The
TQMC contractor shall issue a written notice of the reconsideration
determination using the suggested format and content set forth in
Section 3, paragraph 6.0 as guidance.
3.3 Record
Refer to
Section 3, paragraph 9.0 for the record of
the reconsideration to be maintained by the TQMC contractor.
4.0
Waiver
Of Liability Policy
4.1 The contractor shall establish procedures that
ensure the beneficiary and the provider are protected in instances
where they did not know or could not reasonably have been expected
to know that health care services rendered would not be covered
as a result of denial determinations made by the contractor and
the TQMC contractor. For information relating to Waiver of Liability,
refer to the TRICARE Policy Manual (TPM),
Chapter 1, Section 4.1.
4.2 For pharmacy
claims, waiver of liability applies only to pharmaceuticals which
are prescribed within the DoD P&T Committee guidelines and found
retrospectively to be not medically necessary.