“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.