A Minnesota District Court judge’s ruling “has huge implications for wrongful denial of coverage cases,” and may have long standing implications for the external review industry. The case of James Linn et al. v. BCBSM, Inc., addressed a plaintiff seeking damages against a health plan for its initial refusal to pay for proton-beam radiation therapy for the plaintiff’s bone cancer. This treatment was ultimately deemed medically necessary by MAXIMUS in an external review (ER).
An article in Minnesota Lawyer reports “although the company ultimately paid for the proton-beam radiation treatment it had initially deemed ‘investigative,’ the insureds, James and Gloria Linn, argue that the delay of more than a year was a breach of the contract’s timeliness requirements and caused consequential damages.”
The attorney for the plaintiff argues the opinion is significant not only for what it said but also for what was not expressly addressed. “The external review opinion is binding on the insurance beyond the question of payment for a procedure and that implies consequences to the company that wrongfully refuses coverage,” according to Brandon Schwartz. The article further states, “The court did not say that compensatory damages are unavailable in this contract breach case. Instead, it left the issue open on remand.”
Knowing Your State’s Laws
In the Minnesota case, the judge left open the question of the scope of damages to be awarded. The damages could be substantial due to the delay of over a year for treatment to be reimbursed. The importance of compliance with state and federal regulations can only be underscored by this decision.
Compliance with state and federal ER laws can be a nuanced endeavor. Differences exist between states in terms of the types of entities eligible to be certified to perform ER, clinical review criteria, whether oversight by a medical director is required, and time frames for both standard and expedited appeals. While complex, these regulations play an important part in consumer protection, ensuring appropriate care is provided for patients, and oversight of health plans. And it’s important to understand laws specific to the particular state(s) in which you do business.
The RegQuest ER module aims to assist in compliance efforts by providing useful summaries of key state and federal ER regulatory requirements, with convenient hyperlinks to informative sites and documents. You can quickly access key components, including: information on the scope, regulatory contact information, licensure requirements, program requirements, reviewer qualifications, timelines for standard, expedited and experimental appeals, and other relevant information.
As a result of its extensive subject matter, RegQuest is a must-have resource for health care professionals, compliance staff, benefit administrators, consumers, government officials and others who require a better understanding of the ER process. This easy-to-use service assists medical insurance management in the areas of business, legal and regulatory forces and stays on top of all new federal and state requirements. As a subscriber, you gain instant access to up-to-date information on utilization management (UM), ER as well as grievance and administrative appeals. With a mouse click you can review state surveys, trend reports, blogs and more.
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 Jones, Barbara L. “Treatment delay may cost insurer,” Minnesota Lawyer, Feb. 2, 2017. Retrieved from: http://minnlawyer.com/2017/02/02/treatment-delay-may-cost-insurer/