SAMPLE LETTER - ASC FACILITY DENIAL (rev 2, FN)

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					               SAMPLE APPEAL LETTER - ASC / FACILITY DENIAL

                                  [Physician Letterhead]


Date:

Re:     [Patient Name]
        [Date of Injury]
        [Claim Number]


Dear [Medical Director]:

I am writing to you regarding [Name of insurance company]’s recent refusal to approve
surgical services to be performed at [Name of center] by [Name of physician/surgeon] on
the above referenced patient.

It is my understanding that your refusal to authorize services at [Name of center]
occurred immediately following [Name of physician/surgeon]’s disclosure of financial
interest in our Center. I have also been informed that this decision was based on [Name
of insurance company]’s interpretation of recently enacted legislation related to physician
self-referral.

While SB228 includes language prohibiting physician self-referral to entities, such as
outpatient surgery centers, to which he/she has a financial interest, a physician is
permitted to refer patients to outpatient surgical centers if: (1) the Center does not
compensate the physician for the patient referral, and (2) any equipment lease
arrangement between the physician and the hospital or Center is written, commercially
reasonable, has a fixed periodic rent payment, is for a term of at least one year, and the
lease payment is not affected by either party’s referrals of volume of services. Moreover,
a physician is exempted from the prohibition when he/she has obtained a service
preauthorization from the insurer or self-insured employer after disclosure of the
financial relationship. Thus, disclosure of the financial arrangement should not result in a
denial of authorization for payment, but rather is a basis to approve payment. Labor Code
§139.31(c)(1) and (i).

We understand that there is confusion about the provisions of the new law. The
Legislature’s intent in addressing the issue of physician self-referral was to ensure that
patient referrals were not made inappropriately while at the same time ensuring that
injured workers have timely access to quality medical care. We strongly disagree that in
amending Labor Code §139.31, the Legislature intended to allow payment denials based
on ownership.

Our Center meets the exemption requirements under Labor Code 139.31. [If applicable:
Our Center does not compensate [Name of physician/surgeon] for the referral and meets
the requirements for equipment leases and/or has disclosed the financial interest.] [If
applicable: We have an impeccable record of providing high standards of medical care
and our reputation of excellence is undisputed in our community. We strongly believe
that [Name of physician/surgeon]’s interest in our company coupled with his/her
expertise as highly skilled physician/surgeon, with a proven track record of returning
injured workers back to work, has only helped us to maintain those standards.] [If
applicable: We are proud to be approved to provide services to Medicare and Medi-Cal
beneficiaries and are contracted with a variety HMO and PPO insurers in our area.]
[Optional: Include other supportive information about the Center.]

We respectfully request that you reconsider your previous decision and authorize our
Center to participate in providing the high quality medical care that [Name of patient]
deserves. If you have any questions about our ability to provide this service or would
like more information about our Center, I can be reached at [phone number].

Thank you in advance for your prompt attention to this matter.

Sincerely,



[Medical Director or Administrator]



cc:    [Name of Patient]

				
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