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ERISA External Reviews: Statutory Mandate for Legal Experts in Coverage Determinations

ERISA External Reviews: Statutory Mandate for Legal Experts in Coverage Determinations

By Jim Bobeck

As a law, ERISA is a complicated hodgepodge of many provisions regulating pension, health plans, and patient protections. Tucked away in paragraph (d)(2)(iii)(B)(1) of 45 CFR 147.136 is a seemingly innocuous provision that in summary states the following:

Health insurance issuers (not just plans) must have an external appeals process where appeals are referred to an IRO…and “the assigned IRO will utilize legal experts where appropriate to make coverage determinations under the plan or coverage.”

Employer-Sponsored Plans, Multi-State Plans, and TPA Administrators: Consider yourself on notice.

A quick poll would inform you that most administrators don’t know about this provision.  However, lack of awareness of this arcane statute is still not a defense to the law.

What should you do?

  1. Commence your due diligence.Identify how many coverage or administrative determinations you receive on a yearly basis. Odds are, the number is higher than you think, and therefore your liability grows the more it’s ignored.
  2. Find an IRO with healthcare attorneys that can legally handle these cases.
  3. Stop sending coverage determinations to physicians who are misapplying medical necessity judgment to these cases.

No matter what happens with the ACA and the latest Tax Bill overhaul in Congress, these provisions will remain. They are mandated to protect beneficiaries and also insurers to provide proper review of claims.