Utilization management requirements often run counter to the medical standard of care
When representing providers, I have noticed an unfortunate trend in recent years. Utilization management (UM) is encroaching upon the profession of medicine. With utilization management, the managed care industry created protocols and standards that purport to enhance the delivery of patient care. Healthcare providers must be aware of the differences between these guidelines and medical standards to ensure their claims for services are covered and reimbursed.
UM—also known as utilization review (UR)—consists of published guidelines based on peer-reviewed and industry white papers related to clinical services. These standards are then employed to make coverage determinations based on the appropriateness of a service. In theory, these guidelines seem laudable. In practice, however, they are often inconsistent with the medical standard of care.
While it is still true that only a physician may decide whether a service is medically necessary, health plans and payers have successfully deployed UM criteria to determine whether healthcare services are reimbursable. Often, and well after the services are rendered, the health plan’s medical director or clinical designate will write the provider an unsupported conclusion such as: “We have determined that the treatment did not meet clinical criteria for the level of care rendered.”
Care Deemed Not Medically Necessary
Consider for instance, a patient recovering at a hospital from sepsis, an infection in the blood. After five days of inpatient care, she recovers and is discharged home. During the stay, the patient’s health plan was concurrently informed of the patient’s condition and received authorization for the inpatient admission. However, after the stay—and after the hospital submits the bill—the health plan re-reviews the clinical record and issues a denial for the last two days of the inpatient admission, stating that there was a delay in discharge. The health plan asserts that the last two days of inpatient care were not medically necessary, and therefore will not be reimbursed.
The Problem
However, the standards used in upholding the denial are pre-published guidelines. Citing peer-reviewed journal articles, the guidelines are supposedly evidence-based and by extension purport to establish an appropriate standard of care, despite an express disclaimer that they are not intended to supplant professional medical opinion. Two well known industry guidelines are InterQual and MCG Care (formerly Milliman Care Guidelines).
The industry guidelines use goal length of stays, optimal recovery courses, and rapid recovery guidelines as rubrics. These analyses miss the point of a particular patient’s care: focusing on a specific patient. It’s like using a cookbook to practice medicine, or citing statistical averages to determine a course of care for a patient. It cannot achieve a meaningful clinical result. While published criteria can help guide care, medical necessity is cut from a distinct cloth. Indeed, the practice of medicine involves patient care delivered in a manner “consistent with currently accepted standards of good medical practice.”[1] What the payers often ignore are the years of medical education, training, and experience required for proper patient care.
Interfering with Patient Care
While managed care organizations and other payers say they are trying to improve quality of care, they often instead interfere with patient care by not allowing for payment for services that fail to meet reimbursement criteria based solely on these care guidelines. Ultimately, these organizations use the guidelines to review patient care in a manner that diverges from appropriate medical necessity.
I have seen this all too often with oncology patients who need life-saving services that are denied payment or not pre-authorized. As a consequence, one could say the care guidelines are being weaponized by health plans.
How Providers Should Protect Themselves
In reviewing the provider services agreement, the payer agrees to cover and reimburse medically necessary services. Medical necessity is typically defined by accepted standards of good medical care—that is, by physicians in the community.[2] Under the law, the applicable contract should never state that coverage is based on InterQual-covered services or MCG-approved services. The legal and contractual definition for the standard of care is medical necessity as determined by a physician.
The best way providers can shield themselves from denied payments is to be aware that payers will review their clinical decisions using a different standard. Be sure to check your contracts with payers to make sure that medical necessity is clearly defined in a manner consistent with applicable law, and not by UM/UR standards. If a payer is not complying, then appeal the denial, file a regulatory complaint, and arbitrate or litigate, if necessary. Always make sure your patient records reflect the reasoning you used to arrive at your clinical decisions, because your clinical decisions need to be defensible. Keeping good records will strengthen your case. Ultimately, hire an experienced attorney, if you must, to defend your services and your patient’s care.
Medical practice is still solely within the purview of licensed physicians, and remains a profession, science, and art. Healthcare providers must never yield to another standard of care, or reimbursement.
[1] Maryland administrative code COMAR 10.09.36.01B(11).
[2] HealthCare.gov defines “medically necessary” as “[h]ealth care services or supplies needed to diagnose or treat an illness, injury, condition, disease or its symptoms and that meet accepted standards of medicine.” (Emphasis added.) https://www.healthcare.gov/glossary/medically-necessary/, accessed on Jul. 30, 2019.
Anderson & Quinn, LLC is a law firm based in Rockville, Maryland, providing individuals, businesses, corporations, and healthcare institutions with the legal and litigation support they need to protect revenues.
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