HOUSE BILL No. 6494 November 7, 2002, Introduced by Reps. LaSata, Newell and Richner and referred to the Committee on Insurance and Financial Services. A bill to amend 2000 PA 251, entitled "Patient's right to independent review act," by amending sections 11, 13, 15, and 23 (MCL 550.1911, 550.1913, 550.1915, and 550.1923), as amended by 2000 PA 398. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 11. (1) Not later than 60 days after the date of 2 receipt of a notice of an adverse determination or final adverse 3 determination under section 7, a covered person or the covered 4 person's authorized representative may file a request for an 5 external review with the commissioner. Upon receipt of a request 6 for an external review, the commissioner immediately shall notify 7 and send a copy of the request to the health carrier that made 8 the adverse determination or final adverse determination that is 9 the subject of the request. 07200'02 DKH 2 1 (2) Not later than 5 business days after the date of receipt 2 of a request for an external review, the commissioner shall 3 complete a preliminary review of the request to determine all of 4 the following: 5 (a) Whether the individual is or was a covered person in the 6 health benefit plan at the time the health care service was 7 requested or, in the case of a retrospective review, was a cov- 8 ered person in the health benefit plan at the time the health 9 care service was provided. 10 (b) Whether the health care service that is the subject of 11 the adverse determination or final adverse determination reason- 12 ably appears to be a covered service under the covered person's 13 health benefit plan. 14 (c) Whether the covered person has exhausted the health 15 carrier's internal grievance process unless the covered person is 16 not required to exhaust the health carrier's internal grievance 17 process. 18 (d) The covered person has provided all the information and 19 forms required by the commissioner that are necessary to process 20 an external review, including the health information release 21 form. 22 (e) Whether the health care service that is the subject of 23 the adverse determination or final adverse determination appears 24 to involve issues of medical necessity or clinical review 25 criteria. 26 (3) Upon completion of the preliminary review under 27 subsection (2), the commissioner immediately shall provide a 07200'02 3 1 written notice in plain English to the covered person and, if 2 applicable, the covered person's authorized representative as to 3 whether the request is complete and whether it has been accepted 4 for external review. 5 (4) If a request is accepted for external review, the com- 6 missioner shall do both of the following: 7 (a) Include in the written notice under subsection (3) a 8 statement that the covered person or the covered person's autho- 9 rized representative may submit to the commissioner in writing 10 within 7 business days following the date of the notice addi- 11 tional information and supporting documentation that the review- 12 ing entity shall consider when conducting the external review. 13 (b) Immediately notify the health carrier in writing of the 14 acceptance of the request for external review. 15 (5) If a request is not accepted for external review because 16 the request is not complete, the commissioner shall inform the 17 covered person and, if applicable, the covered person's autho- 18 rized representative what information or materials are needed to 19 make the request complete. If a request is not accepted for 20 external review, the commissioner shall provide written notice in 21 plain English to the covered person, if applicable, the covered 22 person's authorized representative, and the health carrier of the 23 reasons for its nonacceptance. 24 (6) If a request is accepted for external review and appears 25 to involve issues of medical necessity or clinical review cri- 26 teria, the commissioner shall assign an independent review 27 organization at the time the request is accepted for external 07200'02 4 1 review. The assigned independent review organization shall be 2 approved under this act to conduct external reviews and shall 3 provide a written recommendation to the commissioner on whether 4 to uphold or reverse the adverse determination or the final 5 adverse determination. 6 (7) If a requestisaccepted for external review,does 7 not appear to involve issues of medical necessity or clinical 8 review criteria,and appears to only involve purely contrac- 9 tual provisions of a health benefit plan, such as covered bene- 10 fits or accuracy of coding, the commissioner may keep the request 11 and conduct his or her own external review or may assign an inde- 12 pendent review organization as provided in subsection (6) at the 13 time the request is accepted for external review. Except as oth- 14 erwise provided in subsection (16), if the commissioner keeps a 15 request, he or she shall review the request and issue a decision 16 upholding or reversing the adverse determination or final adverse 17 determination within the same time limits and subject to all 18 other requirements of this act for requests assigned to an inde- 19 pendent review organization. If at any time during the 20 commissioner's review of a request it is determined that a 21 request does appear to involve issues of medical necessity or 22 clinical review criteria, the commissioner shall immediately 23 assign the request to an independent review organization approved 24 under this act to conduct external reviews. 25 (8) In reaching a recommendation, the reviewing entity is 26 not bound by any decisions or conclusions reached during the 07200'02 5 1 health carrier's utilization review process or the health 2 carrier's internal grievance process. 3 (9) Not later than 7 business days after the date of the 4 notice under subsection (4)(b), the health carrier or its desig- 5 nee utilization review organization shall provide to the review- 6 ing entity the documents and any information considered in making 7 the adverse determination or the final adverse determination. 8 Except as provided in subsection (10), failure by the health car- 9 rier or its designee utilization review organization to provide 10 the documents and information within 7 business days shall not 11 delay the conduct of the external review. 12 (10) Upon receipt of a notice from the assigned independent 13 review organization that the health carrier or its designee util- 14 ization review organization has failed to provide the documents 15 and information within 7 business days, the commissioner may ter- 16 minate the external review and make a decision to reverse the 17 adverse determination or final adverse determination and shall 18 immediately notify the assigned independent review organization, 19 the covered person, if applicable, the covered person's autho- 20 rized representative, and the health carrier of his or her 21 decision. 22 (11) The reviewing entity shall review all of the informa- 23 tion and documents received under subsection (9) and any other 24 information submitted in writing by the covered person or the 25 covered person's authorized representative under subsection 26 (4)(a) that has been forwarded by the commissioner. Upon receipt 27 of any information submitted by the covered person or the covered 07200'02 6 1 person's authorized representative under subsection (4)(a), at 2 the same time the commissioner forwards the information to the 3 independent review organization, the commissioner shall forward 4 the information to the health carrier. 5 (12) The health carrier may reconsider its adverse determi- 6 nation or final adverse determination that is the subject of the 7 external review. Reconsideration by the health carrier of its 8 adverse determination or final adverse determination does not 9 delay or terminate the external review. The external review may 10 only be terminated if the health carrier decides, upon completion 11 of its reconsideration, to reverse its adverse determination or 12 final adverse determination and provide coverage or payment for 13 the health care service that is the subject of the adverse deter- 14 mination or final adverse determination. Immediately upon making 15 the decision to reverse its adverse determination or final 16 adverse determination, the health carrier shall notify the cov- 17 ered person, if applicable the covered person's authorized repre- 18 sentative, if applicable the assigned independent review organi- 19 zation, and the commissioner in writing of its decision. The 20 reviewing entity shall terminate the external review upon receipt 21 of the notice from the health carrier. 22 (13) In addition to the documents and information provided 23 under subsection (9), the reviewing entity, to the extent the 24 information or documents are available and the reviewing entity 25 considers them appropriate, shall consider the following in 26 reaching a recommendation: 07200'02 7 1 (a) The covered person's pertinent medical records. 2 (b) The attending health care professional's 3 recommendation. 4 (c) Consulting reports from appropriate health care profes- 5 sionals and other documents submitted by the health carrier, the 6 covered person, the covered person's authorized representative, 7 or the covered person's treating provider. 8 (d) The terms of coverage under the covered person's health 9 benefit plan with the health carrier. 10 (e) The most appropriate practice guidelines, which may 11 include generally accepted practice guidelines, evidence-based 12 practice guidelines, or any other practice guidelines developed 13 by the federal government or national or professional medical 14 societies, boards, and associations. 15 (f) Any applicable clinical review criteria developed and 16 used by the health carrier or its designee utilization review 17 organization. 18 (14) The assigned independent review organization shall pro- 19 vide its recommendation to the commissioner not later than1420 10 BUSINESS days after the assignment by the commissioner of the 21 request for an external review OR 5 BUSINESS DAYS AFTER RECEIPT 22 OF COMPLETE INFORMATION UNDER SUBSECTION (4)(A) OR (9), WHICHEVER 23 IS LATER. The independent review organization shall include in 24 its recommendation all of the following: 25 (a) A general description of the reason for the request for 26 external review. 07200'02 8 1 (b) The date the independent review organization received 2 the assignment from the commissioner to conduct the external 3 review. 4 (c) The date the external review was conducted. 5 (d) The date of its recommendation. 6 (e) The principal reason or reasons for its recommendation. 7 (f) The rationale for its recommendation. 8 (g) References to the evidence or documentation, including 9 the practice guidelines, considered in reaching its 10 recommendation. 11 (15) Upon receipt of the assigned independent review 12 organization's recommendation under subsection (14), the commis- 13 sioner immediately shall review the recommendation to ensure that 14 it is not contrary to the terms of coverage under the covered 15 person's health benefit plan with the health carrier. 16 (16) The commissioner shall provide written notice in plain 17 English to the covered person, if applicable the covered person's 18 authorized representative, and the health carrier of the decision 19 to uphold or reverse the adverse determination or the final 20 adverse determination not later than 7 business days after the 21 date of receipt of the selected independent review organization's 22 recommendation. If the commissioner has kept a request for 23 review, the commissioner shall provide written notice in plain 24 English to the covered person, if applicable the covered person's 25 authorized representative, and the health carrier of his or her 26 decision not later than1410 BUSINESS days after the decision 07200'02 9 1 to keep the request. The commissioner shall include in a notice 2 under this subsection all of the following: 3 (a) The principal reason or reasons for the decision, 4 including, as an attachment to the notice or in any other manner 5 the commissioner considers appropriate, the information provided 6 as determined by the reviewing entity under subsection (14). 7 (b) If appropriate, the principal reason or reasons why the 8 commissioner did not follow the assigned independent review 9 organization's recommendation. 10 (17) Upon receipt of a notice of a decision under subsection 11 (16) reversing the adverse determination or final adverse deter- 12 mination, the health carrier immediately shall approve the cover- 13 age that was the subject of the adverse determination or final 14 adverse determination. 15 (18) IF THE COMMISSIONER DETERMINES THAT ADDITIONAL INFORMA- 16 TION OR MEDICAL RECORDS NOT IN THE POSSESSION OF THE HEALTH CAR- 17 RIER OR COVERED PERSON ARE NEEDED TO COMPLETE A REVIEW KEPT BY 18 THE COMMISSIONER UNDER SUBSECTION (7) OR THAT ADDITIONAL INFORMA- 19 TION OR MEDICAL RECORDS NOT IN THE POSSESSION OF THE HEALTH CAR- 20 RIER OR COVERED PERSON OR THAT ADDITIONAL REVIEW BY AN INDEPEN- 21 DENT REVIEW ORGANIZATION IS NEEDED, THE COMMISSIONER MAY ISSUE AN 22 ORDER TO PRODUCE THE ADDITIONAL INFORMATION OR MEDICAL RECORDS OR 23 MAY ISSUE AN ORDER FOR ADDITIONAL INDEPENDENT REVIEW 24 RECOMMENDATIONS. THE ORDER SHALL CONTAIN SPECIFIC TIME FRAMES IN 25 WHICH THE INFORMATION OR RECORDS SHALL BE PROVIDED. THE COMMIS- 26 SIONER MAY ALSO ISSUE ANY ORDER NECESSARY TO ADMINISTER A 27 REVIEW. TIME REQUIREMENTS UNDER SUBSECTION (16) SHALL BE TOLLED 07200'02 10 1 UNTIL THE COMMISSIONER RECEIVES THE ADDITIONAL INFORMATION OR 2 MEDICAL RECORDS, ADDITIONAL INDEPENDENT REVIEW RECOMMENDATIONS, 3 OR CONFIRMATION OF COMPLIANCE WITH HIS OR HER ORDER. THE COMMIS- 4 SIONER MAY PROCEED UNDER SUBSECTION (9) IF THE TIME PERIODS IN 5 THE ORDER ARE NOT COMPLIED WITH. 6 (19) AS USED IN THIS SECTION, "BUSINESS DAY" MEANS ANY DAY 7 ON WHICH THE OFFICE OF FINANCIAL AND INSURANCE SERVICES IS OPEN 8 AND EXCLUDES SATURDAYS, SUNDAYS, LEGAL HOLIDAYS, AND ANY OTHER 9 DAY ON WHICH THE OFFICE OF FINANCIAL AND INSURANCE SERVICES IS 10 CLOSED. FOR THE PURPOSE OF COMPUTING TIME, THE DAY OF THE ACT OR 11 EVENT AFTER WHICH THE DESIGNATED PERIOD OF TIME BEGINS TO RUN IS 12 NOT INCLUDED. THE LAST DAY OF THE PERIOD IS INCLUDED, UNLESS IT 13 IS A SATURDAY, SUNDAY, LEGAL HOLIDAY, OR OTHER DAY ON WHICH THE 14 OFFICE OF FINANCIAL AND INSURANCE SERVICES IS NOT OPEN, IN WHICH 15 CASE THE PERIOD RUNS UNTIL THE END OF THE NEXT DAY THAT IS NOT A 16 SATURDAY, SUNDAY, LEGAL HOLIDAY, OR OTHER DAY ON WHICH THE OFFICE 17 OF FINANCIAL AND INSURANCE SERVICES IS CLOSED. 18 Sec. 13. (1) Except as provided in subsection (11), a cov- 19 ered person or the covered person's authorized representative may 20 make a request for an expedited external review with the commis- 21 sioner within 10 days after the covered person receives an 22 adverse determination if both of the following are met: 23 (a) The adverse determination involves a medical condition 24 of the covered person for which the time frame for completion of 25 an expedited internal grievance would seriously jeopardize the 26 life or health of the covered person or would jeopardize the 07200'02 11 1 covered person's ability to regain maximum function as 2 substantiated by a physician either orally or in writing. 3 (b) The covered person or the covered person's authorized 4 representative has filed a request for an expedited internal 5 grievance. 6 (2)AtNOT LATER THAN 2 HOURS AFTER the time the commis- 7 sioner receives a request for an expedited external review, the 8 commissionerimmediately shall notify and provide a copy of the9request to the health carrier that made the adverse determination10or final adverse determinationSHALL DETERMINE WHETHER THE 11 REQUEST MEETS THE REQUIREMENTS OF SUBSECTION (1) AND THE REVIEWA- 12 BILITY REQUIREMENTS OF SECTION 11(2). If the commissioner deter- 13 mines the request meets the REQUIREMENTS OF SUBSECTION (1) AND 14 THE reviewability requirements under section 11(2), the commis- 15 sioner IMMEDIATELY shallassignDO BOTH OF THE FOLLOWING: 16 (A) NOTIFY AND PROVIDE A COPY OF THE REQUEST TO THE HEALTH 17 CARRIER THAT MADE THE ADVERSE DETERMINATION OR FINAL ADVERSE 18 DETERMINATION. 19 (B) ASSIGN an independent review organization that has been 20 approved under this act to conduct the expedited external review 21 and to provide a written recommendation to the commissioner on 22 whether to uphold or reverse the adverse determination or final 23 adverse determination. 24 (3) If a covered person has not completed the health 25 carrier's expedited internal grievance process, the independent 26 review organization shall determine immediately after receipt of 27 the assignment to conduct the expedited external review whether 07200'02 12 1 the covered person will be required to complete the expedited 2 internal grievance prior to conducting the expedited external 3 review. If the independent review organization determines that 4 the covered person must first complete the expedited internal 5 grievance process, the independent review organization immedi- 6 ately shall notify the covered person and, if applicable, the 7 covered person's authorized representative of this determination 8 and that it will not proceed with the expedited external review 9 until the covered person completes the expedited internal 10 grievance. 11 (4) In reaching a recommendation, the assigned independent 12 review organization is not bound by any decisions or conclusions 13 reached during the health carrier's utilization review process or 14 the health carrier's internal grievance process. 15 (5) Not later than 12 hours after the health carrier 16 receives the notice under subsection (2), the health carrier or 17 its designee utilization review organization shall provide or 18 transmit all necessary documents and information considered in 19 making the adverse determination or final adverse determination 20 to the assigned independent review organization electronically or 21 by telephone or facsimile or any other available expeditious 22 method. 23 (6) In addition to the documents and information provided or 24 transmitted under subsection (5), the assigned independent review 25 organization, to the extent the information or documents are 26 available and the independent review organization considers them 07200'02 13 1 appropriate, shall consider the following in reaching a 2 recommendation: 3 (a) The covered person's pertinent medical records. 4 (b) The attending health care professional's 5 recommendation. 6 (c) Consulting reports from appropriate health care profes- 7 sionals and other documents submitted by the health carrier, cov- 8 ered person, the covered person's authorized representative, or 9 the covered person's treating provider. 10 (d) The terms of coverage under the covered person's health 11 benefit plan with the health carrier. 12 (e) The most appropriate practice guidelines, which may 13 include generally accepted practice guidelines, evidence-based 14 practice guidelines, or any other practice guidelines developed 15 by the federal government or national or professional medical 16 societies, boards, and associations. 17 (f) Any applicable clinical review criteria developed and 18 used by the health carrier or its designee utilization review 19 organization in making adverse determinations. 20 (7) The assigned independent review organization shall pro- 21 vide its recommendation to the commissioner as expeditiously as 22 the covered person's medical condition or circumstances require, 23 but in no event more than 36 hours afterthe datethe commis- 24 sionerreceivedTRANSMITS TO THE INDEPENDENT REVIEW ORGANIZA- 25 TION NOTICE OF ASSIGNMENT OF the request for an expedited exter- 26 nal review. 07200'02 14 1 (8) Upon receipt of the assigned independent review 2 organization's recommendation, the commissioner immediately shall 3 review the recommendation to ensure that it is not contrary to 4 the terms of coverage under the covered person's health benefit 5 plan with the health carrier. 6 (9) As expeditiously as the covered person's medical condi- 7 tion or circumstances require, but in no event more than 24 hours 8 after receiving the recommendation of the assigned independent 9 review organization, the commissioner shall complete the review 10 of the independent review organization's recommendation and 11 notify the covered person, if applicable, the covered person's 12 authorized representative, and the health carrier of the decision 13 to uphold or reverse the adverse determination or final adverse 14 determination. If this notice was not in writing, within 2 days 15 after the date of providing that notice, the commissioner shall 16 provide written confirmation of the decision to the covered 17 person, if applicable, the covered person's authorized represen- 18 tative, and the health carrier and include the information 19 required in section 11(16). 20 (10) Upon receipt of a notice of a decision under subsection 21 (9) reversing the adverse determination or final adverse determi- 22 nation, the health carrier immediately shall approve the coverage 23 that was the subject of the adverse determination or final 24 adverse determination. 25 (11) An expedited external review shall not be provided for 26 retrospective adverse determinations or retrospective final 27 adverse determinations. 07200'02 15 1 Sec. 15. (1) An external review decision and an expedited 2 external review decision are the final administrative remedies 3 available under this act. A person aggrieved by an external 4 review decision or an expedited external review decision may seek 5 judicial review UNDER SECTION 631 OF THE REVISED JUDICATURE ACT 6 OF 1961, 1961 PA 236, MCL 600.631, no later than 60 days from the 7 date of the decision in the circuit court for the county where 8 the covered person resides or in the circuit court of Ingham 9 county AND SHALL SERVE UPON THE COMMISSIONER A COPY OF THE PETI- 10 TION FOR REVIEW. THE COMMISSIONER MAY BECOME A PARTY TO ANY 11 JUDICIAL REVIEW OF AN EXTERNAL REVIEW DECISION BY FILING AN 12 APPEARANCE IN THE CASE. THE HEALTH CARRIER IN ANY JUDICIAL 13 REVIEW NOT INVOLVING THE COMMISSIONER SHALL SERVE UPON THE COM- 14 MISSIONER A COPY OF THE CIRCUIT COURT FINAL ORDER IN THE REVIEW. 15 (2)Subsection (1)THE AVAILABILITY OF REVIEW UNDER THIS 16 ACT does not preclude a health carrier from seeking other reme- 17 dies available under applicable state law. 18 (3)Subsection (1)THE AVAILABILITY OF REVIEW UNDER THIS 19 ACT does not preclude a covered person from seeking other reme- 20 dies available under applicable federal or state law. 21 (4) A covered person or the covered person's authorized rep- 22 resentative may not file a subsequent request for external review 23 involving the same adverse determination or final adverse deter- 24 mination for which the covered person has already received an 25 external review decision under this act. 26 Sec. 23. (1) An independent review organization assigned to 27 conduct an external review under section 11 or 13 shall maintain 07200'02 16 1 for 3 years written records in the aggregate and by health 2 carrier on all requests for external review for which it con- 3 ducted an external review during a calendar year. Each indepen- 4 dent review organization required to maintain written records on 5 all requests for external review for which it was assigned to 6 conduct an external review shall submit to the commissioner, at 7 least annually, a report in the format specified by the 8 commissioner. 9 (2) The report to the commissioner under subsection (1) 10 shall include in the aggregate and for each health carrier all of 11 the following: 12 (a) The total number of requests for external review. 13 (b) The number of requests for external review resolved and, 14 of those resolved, the number resolved upholding the adverse 15 determination or final adverse determination and the number 16 resolved reversing the adverse determination or final adverse 17 determination. 18 (c) The average length of time for resolution. 19 (d) A summary of the types of coverages or cases for which 20 an external review was sought, as provided in the format required 21 by the commissioner. 22 (e) The number of external reviews under section 11(12) that 23 were terminated as the result of a reconsideration by the health 24 carrier of its adverse determination or final adverse determina- 25 tion after the receipt of additional information from the covered 26 person or the covered person's authorized representative. 07200'02 17 1 (f) Any other information the commissioner may request or 2 require. 3 (3) Each health carrier shall maintain for 3 years written 4 records in the aggregate and for each type of health benefit plan 5 offered by the health carrier on all requests for external review 6that are filed with the health carrier orthat the health car- 7 rier receives notice of from the commissioner under this act AND 8 SHALL PRODUCE THESE RECORDS UPON THE COMMISSIONER'S REQUEST. 9Each health carrier required to maintain written records on all10requests for external review shall submit to the commissioner, at11least annually, a report in the format specified by the12commissioner.13(4) The report to the commissioner under subsection (3)14shall include in the aggregate and by type of health benefit plan15all of the following:16(a) The total number of requests for external review.17(b) From the number of requests for external review that are18filed directly with the health carrier, the number of requests19accepted for a full external review.20(c) The number of requests for external review resolved and,21of those resolved, the number resolved upholding the adverse22determination or final adverse determination and the number23resolved reversing the adverse determination or final adverse24determination.25(d) The average length of time for resolution.07200'02 18 1(e) A summary of the types of coverages or cases for which2an external review was sought, as provided in the format required3by the commissioner.4(f) The number of external reviews under section 11(12) that5were terminated as the result of a reconsideration by the health6carrier of its adverse determination or final adverse determina-7tion after the receipt of additional information from the covered8person or the covered person's authorized representative.9(g) Any other information the commissioner may request or10require.07200'02 Final page. 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