Health Reform's New Claims Appeals & Review Processes: Employer

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					            Health Reform's New Claims
            Appeals & Review Processes:
              Employer Compliance &
                    Contracting
                     Presentation to Northeast Business
                              Group on Health
Patricia M. Wagner             March 2, 2011
Epstein, Becker & Green, P.C.
1227 25th Street, N.W.
Washington, D.C. 20037
(202) 861-4182
pwagner@ebglaw.com
Background

 • Section 1001 of the Patient Protection and
   Affordable Care Act (“PPACA”), added
   section 2719 to the Patient Health Service
   Act (“PHSA”)
   – all non-grandfathered group and individual
     health plans must implement “effective
     appeals processes.”




                      2
Background

 • On July 23, 2010, the U.S. Departments of
   Health and Human Services (“HHS”),
   Labor and the Treasury (collectively, the
   “Agencies”) issued Interim Final Rules
   (“IFR”) implementing this particular section
   of PPACA by setting forth the specific
   requirements for these appeals processes.
 • DOL has also issued 2 “Technical
   Guidance” documents
                     3
Original Claims Regulations

 • Original Claims Regulations, were
   effective after the first day of the first plan
   year beginning on or after July 1, 2002,
   but in no event later than January 1, 2003.
 • Specified the timeframes for participant
   and beneficiary notification of claims
   determinations and appeals
 • Also specified manner of notification.


                       4
Claims and Appeals Regulations

 • Claims and Appeals Regulations
   Address:
   – Initial Benefit Determination – set time
     frames and notice requirements
   – Internal Appeals (appeals handled by the
     plan or the plan’s administrator)
   – External Appeals (must be done by an
     independent external review agent –
     e.g., an IRO) (New requirement)

                      5
What’s New?

 • New regulations
   – Have broadened scope of adverse benefit
     determination
   – Change in determination time period
   – Conflict of interest protections
   – Change in Notification
   – Strict adherence to claims procedures
   – Continued coverage during appeal process
   – Require external appeals process
                     6
Adverse Benefit Determination

 • Definition of Claim
   – Still: a request for health care benefits made
     by plan participant or beneficiary.
 • Adverse benefit determination
   – Under old regulations: based on denial (in
     whole or in part) to pay for services and
     eligibility denials
   – Under new regulations: same, but also
     includes rescission of coverage

                       7
Change in Time Frame

 • Determination of Urgent Care – initial
   decisions
   – Old time frame, no more than 72 hours
   – New time frame, no more than 24 hours




                     8
Other General Changes

 • Must avoid conflicts of interest. Decisions
   on compensation, promotion, hiring,
   termination etc. cannot be made on
   likelihood that person will support denial of
   benefits
 • Before issuing a final adverse benefit
   determination must provide rationale – if
   rationale for decision is based on new or
   additional information.
                      9
Language Requirement
 • Notice must be given in culturally and
   linguistically appropriate manner
 • Culturally and Linguistically Appropriate
   – For plan with fewer than 100 participants,
     providing notice upon request in a non-
     English language in which 25% or more of all
     plan participants are literate only in the same
     non-English language
   – For plans with 100 or more participants,
     providing notice in non-English language
     which the lesser of 500 or more participants
     or 10% or more of all plan participants are
     literate          10
Language Requirement

 • If meet applicable threshold then must:
   – Include a statement in the English version of
     all notices offering the notice in the non-
     English language
   – Once a request is made, provide all further
     notices in the non-English language
   – If provide a customer assistance phone line,
     provide assistance in non-English language


                      11
Notice Requirements

 • Other New Notice Requirements
   – Must include information sufficient to identify
     the claim involved including: date of service,
     health care provider, claim amount, diagnosis
     code and its corresponding meaning, and the
     treatment code and its corresponding
     meaning.




                      12
Notice Requirements

 • Other Notice Requirements
   – Must include the denial code and its
     corresponding meaning
   – A description of the plan or issuers standard,
     if any, that was used in denying the claim.
   – Description must include a discussion of the
     decision.




                       13
Notice Requirements

 • Must provide a description of available internal
   and external review processes, including
   information regarding how to initiate an appeal.
 • The plan or issuer must disclose the
   availability of, and contact information for,
   any applicable office of health insurance
   consumer assistance or ombudsman to
   assist individuals with review processes



                       14
Other New Requirements

 • If a plan or issuer fails to strictly adhere to all of
   the internal review requirements, then that
   claimant is deemed to have exhausted the
   internal claims and appeals process, regardless
   of whether the plan or issuer asserts that it
   substantially complied or that any error was
   minimal.
 • Exhaustion could then trigger court review or
   external appeal process
 • Coverage during appeal process.
                         15
External Review Required

 • Mandated External Review
   – Follow state process? Rare if self-insured
   – Follow federal process- more likely if self-
     insured
 • Required to have Independent Review
   Organizations to do external appeal
   – Technical Guidance provides standards and
     requirements


                       16
Contact Information

           Patricia M. Wagner
      Epstein, Becker & Green, P.C.
         1227 25th Street, N.W.
        Washington, D.C. 20037
             (202) 861-4182
         pwagner@ebglaw.com



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