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2. What is the plan's definition of "medically necessary treatment?

Each plan adopts its' own definition of "medically necessary treatment". There is much variation in the definition of "medically necessary treatment" between plans and among plans. Medically necessary treatment usually means that the procedure is indicated based upon some pre-determined research and standard of practice in the medical industry. However, some plans are more progressive and determine medically necessary treatment using more recent research data and protocols, while others tend to utilize a more traditional, more proven technology or treatment modality. For example, an individual with disruptive behavior might be treated with Haldol, an older drug on a generic formulary, whereas, the same patient in another setting might be treated with Prozac, a newer drug and maybe not on the formulary. These two prescription drugs are both effective, but one has fewer side effects.

Another example of interpreting "medically necessary treatment" is the individual who is determined to benefit from therapy by the physician and the physical therapist for joint replacement therapy. The physician orders the therapy to start immediately following the surgery to maintain and strength muscle around the joint. However, the plan may determine that strengthening the muscle is not medically necessary treatment and will only approve physical therapy for the joint once the healing process has begun, but not immediately after the surgery to improve the muscle.

Another method used to interpret "medically necessary treatment" is to make decisions on a case-by-case basis, referring to the definition of medical necessity in the Evidence of Coverage as the basis for decision making. This method of decision making enables the health plan to be responsive to an individual's health condition and to treat each person on an individual basis.

The definition used by Medicaid in Colorado for "Medically Necessary" means any health care service required to preserve the Covered Person's health and which, as determined by the Contractor's designated medical representative or Medical Director is:

a. Consistent with accepted standards for the prevention of disease and disability and for treatment of symptoms;

b. Appropriate with regard to standards of good medical practice;

c. Not solely for the convenience of the Covered Person, his or her Physician(s), Hospital, or other providers; and

d. The most appropriate supply or level of service which can be safely provided to the Covered Person.

When specifically applied to an inpatient, it further means that the Covered Person's medical symptoms or condition requires that the diagnosis or treatment cannot be safely provided to the Covered Person in any other setting, i.e., home, outpatient, Nursing Facility.

Medicare's definition of medically necessary treatment or services is ... "reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a mal-formed body member."

Health plans tend to utilize a "stricter" or more narrow definition of "medically necessary treatment", than do indemnity plans. The definitions are usually somewhat vague and can be interpreted somewhat differently by each health plan. If the treatment is determined to be not "medically necessary", it can be appealed.

The courts have mixed approaches to defining medically necessity. A federal court of appeals, in a Medicaid case, states that the decision whether a therapy is medically necessary rests with the patient's physician, and not with clerical personnel or government officials. Some courts have stated that a private insurer cannot deny coverage solely because it disagrees with a physician's judgement of medical necessity.

Others have said that an insurer's interpretations of medical necessity should at least be consistent with community medical standards.

One of the few state definitions of medical necessity is in a Florida statute that limits workers' compensation to medically necessary treatment, and states "Medically necessary means any service or supply used to identify or treat an illness or injury which is appropriate to the patient's diagnosis, consistent with the location of service and with the level of care provided. The service should be widely accepted by the participant peer group, should be based on scientific criteria, and should be determined to be reasonably safe. The service may not be of an experimental, investigative, or research nature, except in those cases which prior approval ... has been obtained" [Florida State #440.13(1)(c)]. Even this definition does not require that medically necessary treatment be effective, and it does allow for coverage of experimental treatment on a case-by-case basis. On the other hand, determining that a service is not experimental does not mean it is medically necessary.

One health plan in their voice mail says "Although a service may be a covered benefit, we may not pay for it". Another plan has repeated footnotes in their Evidence of Coverage statement with the same information. This message alerts beneficiaries to the fact that all services which are covered may not be determined to be medically necessary.

3. What conditions are considered "emergencies"? What conditions are considered "urgent"?

To clarify these definitions, it is necessary to review the Evidence of Coverage. The "Evidence of Coverage" or your benefits book can help to determine what definitions are used. A general definition of "emergency care" is often defined as medical care that is immediately required because of unforeseen illness or injury. Such services must be or must appear to be needed immediately to prevent the death of the member or a serious impairment of the member's health; for example: heart attack, or suspected heart attack, coma, poisoning, stroke, acute appendicitis, severe allergic reaction, or loss of respiration. Other acute conditions may also be considered emergencies.

Urgent care conditions are situations that are not life threatening but require prompt medical attention to prevent a serious deterioration in a member's health, (e.g, high fever, cuts requiring stitches).

The problem arises when a lay person is responsible for determining a condition requiring "emergency or urgent care". Many "emergencies" arise in the middle of the night. Usually, the individual is frightened and may be unable to make good judgments at the moment, unless they have had previous experience with similar circumstances.

The Colorado Division of Insurance states that emergencies are "situations when the individual needs medical care immediately because of sudden or suddenly worsening illness or injury, and the time needed to reach your plan doctor or hospital appears to you to risk permanent damage to your health." The key to this interpretation is "permanent damage to your health".

Urgent care and after-hours care usually is not life threatening, but causes great discomfort. Usually urgent care must be provided by the Primary Care Provider or the approved urgent care center.

Some examples to determine if the situation requires emergency care:

a. Beneficiary believes chest pain was a heart attack.

b. Individual has elevated blood pressure, nausea, vomiting and vertigo.

c. Individual has previously injured ankle, which is re-injured and bone is protruding through the skin.

Some examples to determine if the situation requires urgent care, but not emergency care:

1. Did the situation which is causing the discomfort occur prior to the "current presenting problem?", for example:

a. The individual has the feeling that something is stuck in their throat, but the individual has already made an appointment to have the situation checked out the next day, implying this is not the first time this condition has occurred.

b. The beneficiary has a rash-allergic reaction without shortness of breath, fever, chills, sore throat, earache, chest pain, nausea or vomiting, but took an ambulance to the emergency room.

c. The beneficiary falls in the kitchen five days before the emergency room visit for knee pain. There appears to be no evidence of distress or fracture or evidence that the condition deteriorated.

d. The beneficiary has heel blisters and is taken by ambulance to the emergency room.

e. Member has swollen forehead and black eyes based upon a fall six days prior and received emergency care at that time. However, the member returns a second time to the emergency room for care of related symptoms which could have been provided in another setting, namely the primary care physician's office.

There is current legislation being proposed in Congress that would require health plans to pay for emergency care if a prudent lay person determined that it was an emergency. The bill introduced in Congress in April 1997 by Rep Charles Norwood (GA) and Sen Alfonse D'Amato (NY) would bar health plans from requiring preauthorization for visits to emergency rooms. Other health plans are going to a 24 hour nurse/help line. If the help line refers you to an emergency room, the plan will pay for the services.

5. What is the procedure for follow-up (such as getting an explanation of test results) after a physician appointment? How long should I expect to wait for the follow-up?

Some physicians routinely contact the patient after the test results are received. Others will send the information by mail. And some physicians wait for the patient to contact them to learn of the test results.

6. How is my physician reimbursed?  Capitation?  Fee for Service?  Salary? Bonuses?

Physician reimbursement is one of the most complicated components of the managed care system of health care delivery. Physician reimbursement is a business practice and not necessarily a "quality of health care" measure or indicator. Initially, when managed health care plans were implemented several years ago, health plans refused to make known to the public, the reimbursement methodologies that were being used, claiming that was privileged information.

As a result, the federal government passed regulations stating that "for Medicare patients, physicians were required to release information on the type of payment arrangements which they have with the health plan." Medicaid is expected to make the same type of ruling shortly.

It should be noted, that a salesman will be knowledgeable if the health plan is a "capitation or risk versus a cost" plan, but may not be aware of the arrangements with physicians, pharmacies and hospitals, as these may vary from employer to employer, as well as between Medicare and Medicaid contractors. Therefore to obtain this type of information, the individual must discuss the type of reimbursement plan directly with physician or their office.

At this time, physicians are usually reimbursed on a capitated system. This means the physician shares the risk of providing care to the patient with the health plan, the hospital and the pharmacy. The physician is paid a set amount, say $15 per patient per month for each patient who is enrolled through a particular health plan and has designated that physician as the primary care provider. Physicians may a) keep all of the $15 for their services which are provided to the patients from that health plan; or b) they may have to utilize a portion of these payments to pay for lab and x-ray services, as well as specialist services. In addition, these physicians may, or may not, get reimbursed a percentage from the pharmacy and/or the hospital fees. Another complicating factor is the "withhold". In this type of arrangement, the health plan withholds a certain percentage, say 25% of the fee it has agreed to pay the physician. If the targets for holding down costs, enrollments, and so forth are reached by the company, the physician is reimbursed some or all of the 25% of the withhold fee. These reimbursement arrangements are designed to reduce the utilization of expensive hospitalizations and over utilization of high cost prescription drugs. This type of arrangement may be referred to as an "alignment of the incentives" in the industry.

The second type of payment structure is the cost approach. Under this type of arrangement, the physician is reimbursed a set fee, but only if the patient is seen. Usually this type of arrangement does not include any incentives for reduction of hospital admissions or pharmacy benefits. The risk of paying for health care is the responsibility of the health plan, rather than shared with the physician, hospital, pharmacy and others.

The third type of payment structure is salary. In this type of health plan, the physician is paid a set salary each month from the health plan. The salary is pre-determined, regardless of reimbursement structures to the health plan.

Bonuses are matter of business practice in many organizations. Bonuses are usually awarded at the end of the contract year, based upon the financial performance of the company. Bonuses are paid above and beyond the "withhold" funds described above. Sometimes the "withhold" funds are confused with "bonuses". Some companies claim they do not give bonuses, but because of their tax status, their employees or physicians and others share in the net income over operating expenses.

7. Is my physician able to discuss all available treatments, even though they many not be covered by my plan?

At this time, physicians are able to discuss all available treatments, even though they may not be covered by the plan. Commonly known as the "gag rule", some of the managed health care plans had traditionally forbid physicians to discuss treatment modalities that were not covered by the plan. The assumption was that if patients knew about more expensive or less well utilized treatment protocols, patients would request that the health plan pay for these more expensive treatment alternatives, based upon available research and the company's definition of "medically necessary treatment".

There was also fear among the medical community that if physicians utilized more expensive treatment modalities, they would be eliminated from the health plan and subsequently, loose a large block of business.

Initially, Medicare passed a regulation allowing physicians to discuss alternative treatments with patients. Medicaid is expected to make a similar rule. Colorado has passed a law forbidding the health plans to restrict physicians to discuss alternative treatment options with patients. Physicians can now discuss all of the available health options with patients. They can indicate the health plan may not pay for these services and they can make recommendations to other resources in the community, such as medical schools, research projects, and out of pocket expenditures.

At the national level, the bill introduced in April 1997 to the Congress by Rep Charles Norwood (GA) and Sen Alfonse D'Amato (NY) includes language to "prohibit plans from limiting a doctor's ability to discuss treatment options and ensure that patients can make timely appeals for adverse decisions, including denial of claims".

Strong arguments are also being made in the courts that the physician and the health plan can be sued and found liable for malpractice of non-treatment. The bill in Congress would also let consumers bring medical malpractice suits against health-insurance plans that are governed by the Employment Retirement and Income Security Act of 1974. Currently such plans, which include most large company-sponsored plans, can't be sued for malpractice because they are exempted from state laws and regulations under ERISA.

8. Can the managed care plan cancel the contract with the provider if the provider makes negative comments about the plan?

Most health plans are not interested in doing business with a physician or provider who is not satisfied with their delivery system of health care. Therefore, they may reserve the right to terminate someone for making negative comments. Some physicians also have contracts indicating that "they can be terminated without cause".

This may cause undue pressure on physicians who may not agree with the practice protocols that are approved by the health plan, especially, if physicians are anxious to try a treatment modality on an individual whom they think will respond well, but the health plan will not pay for the services.

9. Is there an advocate or ombudsman available to help me?

How do I access this service? Who pays for the advocate service?

All of the health plans have a customer service department which is responsible for answering questions, confirming benefits, and handling complaints or problems. These individuals are paid by the health plan. Usually these individuals can be accessed by calling the customer service department or the member services department.

At least one of the health plans in the Colorado now has a personal service representative program. Each member is assigned to a personal services representative to answer questions and solve problems.

For Medicare beneficiaries, individuals can contact the Senior Health Insurance Assistance Program funded by Medicare in their area for advocacy for coverage and information about purchasing decisions.

10. Will the plan (and its contracted providers) respect advance directives and living wills, within legal limitations?

Yes, plans will usually respect advance directives. According to Colorado law, individuals have the right to direct the type and amount of health care which they will receive.

11. Will identifiable information about my diagnosis, treatment, or other case information be accessible by my employer or other parties who have no right to that information?

Employers do not receive confidential information about a particular patient from the health plan. They will however, receive aggregate data which identifies such things as number of cesarean section pregnancies, number of heart attacks, and so forth. State law prohibits the health plan from releasing specific information about a specific individual to an employer.

It should be noted, that in a small business, the employer may be very knowledgeable about a particular individual or group of individuals because of the nature of the small business. For example, if an individual in a small company has been diagnosed with a brain tumor, many of the individuals colleagues as well as management may be aware of the need for frequent physician visits, surgery and time off from work.

Hospital Care

1. Does the plan limit the number of covered days of hospitalization for each illness?

If yes, how many days? How is the hospital reimbursed?  Capitation?  Fee for Service?  Other?

Plans do not routinely limit the number of covered days of hospitalization for each illness. However, they have benchmarks, based upon research and other factors, which are used for determining the average length of stay for a particular illness. These benchmarks are utilized to determine if a continued stay in the hospital is warranted.

In addition, Medicare patients can be reviewed using the DRG (Diagnostic Related Groups) methodology. Under the DRG system, hospitals are reimbursed a certain amount for each diagnosis under which a patient is admitted. Average length of stay in the hospital is usually determined based upon this system. These DRGs provide benchmarks to the health plans, as well, for determining the appropriate length of stay for a specific diagnosis.

If an individual is released too early from the hospital or is believed to be readied for discharge too early, the individual should file an appeal.

2. Which hospitals in my local area are available to me under this plan?

The written information, as well as the sales people, usually are knowledgeable about which hospitals are participating in the network.

Hospitals, as well as other providers, usually have annual contracts with the health plan. Therefore, the contacts may not be renewed in the future.

Some of the health plans are using the "pod" system. Within the health plan, patients are limited to a specific "pod" for their care. Members are restricted to physicians and hospitals within their specific "pod". In a "pod", once an individual enrolls, the individual is part of that primary care physician's network. For example, if an individual enrolls with a physician, the hospital or specialist of choice may not be part of the pod and therefore the member may be required to select a new hospital or specialist, even though their hospital of choice and their specialist are participants in the health plan. Most of the capitated programs for Medicare use pods, although several of the health plans are moving away from the concept.

The use of the "pod" system can also guide the use of which procedures are done at which facilities. For example, recently a beneficiary in Boulder had to go to Swedish Medical Center in south Denver for a special brain scan, even though the Boulder hospital maintained they had the same equipment. This service was probably contracted to only one facility in the metro area, rather than all facilities.

3. Who makes the decision regarding discharge?
My physician?  The managed care company?

The physician is ultimately responsible for discharging patients from the hospital. However, discharges are also monitored and reviewed by the health plan. The case management nurse visits the patient in the hospital, reviews the case and often makes strong recommendations for discharge. Therefore, the ultimate decision to discharge is the physician's, but this may be influenced by the health plan's utilization review nurse(s).

In a recent lawsuit in Oklahoma, the judge ruled that, even though the physician is responsible for discharging the patient, the health care company could be held liable for the discharge. This sets a precedent that health plans play a significant role in discharges from hospitals and can be held legally liable for these actions.

4. If I feel I need to stay in the hospital longer, with whom do I consult?
Physician?  Hospital administration? The Managed Care Plan?

Most frequently, the beneficiary will need to consult with the primary care physician, hospital administration and the health plan to have a hospital stay extended.

The Patient Care Representative in the hospital is responsible for having the case reviewed and helping to implement the appeal process for Medicare beneficiaries. The case is appealed to the Peer Review Organization.

Pediatric Care

1. If  I have dependent children, will my child be covered while he or she is away at school?  If yes, what are the limitations on this coverage?

This benefit most frequently is for beneficiaries of an employee sponsored health plan. Individuals in Medicare plans would not have family coverage. Individuals in Medicaid plans would only be eligible for care in the state of Colorado. To determine if a dependent child benefit is included, the individual needs to read the Evidence of Coverage statement.

2. What immunizations are covered for children (MMR, DPT, etc)?

Immunizations are usually covered as part of the well child checks for preventive health care. Immunizations for international travel, school physicals and such activities may not be covered. Check the Evidence of Coverage for covered immunizations.

Access

1. How are providers selected to participate in this plan?

Health plans use a sophisticated process to determine which physicians they will allow into their plans. This includes such things as board certification, medical loss ratios, willingness to accept fees, and previous experience with managed care plans.

For the general public, although this process is pretty extensive for the health plan, it may not be a critical indicator for beneficiaries. Beneficiaries are usually more interested in "having a good doctor".

2. Do I get to choose my own primary care physician or am I assigned one? Is every primary care physician on your list accepting new patients?
Is there a waiting list for the primary care physician I want to see?
If this information is not available, how do I find out? Can I choose my own family specialists (pediatrician, OB/GYN, or nurse practitioner)?

Most plans allow individuals to choose their own physician. Medicaid has a practice of assigning individuals to a primary care physician. However, the individual can change that assignment by contacting the Peer Review Organization and requesting a change.

The only way to ensure that a specific primary care physician is accepting patients on a specific plan is to talk with the physician's office directly.

Colorado has a law, effective February 1, 1997, that says "managed care plans have to allow women to select obstetricians or gynecologists as their primary care doctors -- or give them largely unrestricted access". Health plans can either let women choose OB-GYNs as their primary care doctors, or they can allow women to refer themselves to OB-GYNs. If health plans require approval to see an OB-GYN, they must approve all reasonable requests. Women can ask in writing or by phone for the referral, and the health plans are required to make a decision within three working days. Referrals cannot be denied because the woman's primary care doctor is capable of providing the same service. Health plans can deny a referral if a woman wants to see an OB-GYN for infertility counseling and that service is not covered. Referrals can also be denied if a woman want to see an OB-GYN for an inappropriate reason, such as a sinus infection or knee injury. The law applies to all policies put into effect after January 31, 1997.

3. Can I choose my own specialist? Within the plan?
Out of network? What is the process for handling a patient request to see a specialist when the primary care physician does not refer? Will I have to pay extra to visit the specialist? Within network? How much? Out of Network?  How much? If I want a second opinion, will the cost be covered? In making a referral, is the primary care physician responsible for specialist's fee or costs?

Health plans will usually allow an individual to choose a specialist who is participating in the health plan. However, the specialist of choice may not be a member of the primary care physician's pod. If this situation occurs, the individual may not be allowed to visit the specialist of choice.

In most cases for a referral to a specialist to be a covered benefit, the individual must have a written referral approved by the health plan from the primary care physician. If the specialist refers the individual to a second specialist for a second possible diagnosis, the individual must usually obtain second written referral from the primary care physician pre-approved by the health plan to the second specialist. The first specialist does not have the authority to refer an individual to a second specialist for further care and evaluation.

Limiting access to specialists may be a cost effective way to reduce health care costs. Specialists can be reimbursed in more than one way. In a capitated system, they may have a contract directly with the health plan, they may get paid out of the pod arrangement, they may get reimbursed from the physician "pool", or they may get reimbursed directly from the health plan. The co-payment for specialists is usually the same as the co-payment for the primary care physician.

If the primary care physician does not make a referral to a specialist, the individual should contact member services to discuss the situation. The individual can usually request a review of the record to determine if additional care is indicated by a specialist. If the review for a visit to a specialist is not approved, then the individual will need to file an appeal. Another option is for the member to seek the services of a specialist and pay for those service privately.

Effective July 1, 1997, one of the health plans has eliminated the need for a referral from the primary care physician to see a specialist. This policy should provide individuals greater access to the care and reduce the gatekeeper approach to health care.

Second opinions for surgery may or may not be a covered benefit, depending upon the coverage. Employers may not include this benefit in a group policy; employees may not be aware of this exclusion. For Medicare beneficiaries, Medicare provides for the opportunity for a second opinion to determine the need for surgery. Medicare beneficiaries can obtain a consultation for a second opinion when surgery is recommended.

The bill introduced in Congress in April 1997 by Rep Charles Norwood (GA) and Sen Alfonse D'Amato (NY) would guarantee patients access to specialists when their physicians believe it is necessary.

4. Will I be allowed to change my physician if I am not satisfied with the one I have? What is the process?

Most plans allow for individuals to change physicians. The process usually involves notifying the health plan of the request for a change of physicians.

Individuals who are on a Medicaid HMO can change physicians by notifying the Colorado Foundation for Medical Care, commonly known as the Peer Review Organization.

Chronic Conditions

1. Will the plan cover pre-existing conditions?  If my condition is considered a pre-existing condition, how long must I wait for coverage to begin? If my condition is considered pre-existing, what is the maximum amount the plan will pay for all health care? If my condition is considered pre-existing, is it going to affect the maximum amount the plan will pay for my family? If yes, how will it be affected?

Most group plans will cover pre-existing conditions, however, employers may opt to pay a maximum annual or lifetime benefit for a certain condition. Colorado law states that individuals enrolled in groups can not be denied coverage for pre-existing conditions if the individual has met the requirements for a waiting period once in their lifetime or if they have waited the required period before seeking coverage and are in a group plan. Colorado also provides for individuals who are self-employed to qualify as a group of one.

For Medicare beneficiaries, the health plan must provide coverage for pre-existing conditions unless the individual is receiving Hospice services or has End Stage Renal Disease. There are no annual or lifetime maximums on benefits. Individuals who disenroll from a Medicare HMO may not be able to get coverage from an indemnity plan because of pre-existing conditions.

For Medicaid beneficiaries, the health plan must provide coverage. There are no annual or lifetime maximums on benefits.

Other Benefits

1. What immunizations are covered for adults (flu, pneumonia, etc)?

This information is described in the Evidence of Coverage statement received from the health plan. These services are covered only if the individual receives services from the primary care provider. Services will not be covered if they are received from a community health clinic.

2. What specific dental care services are covered?

This information is described in the Evidence of Coverage statement received from the health plan. Individuals need to review the Evidence of Coverage for the amount of money and/or visits which are covered under this benefit. Health plans offering these services for Medicare beneficiaries, usually have very limited benefits. The health plan usually also has a contract with a specific dental practice for these services. Referral procedures vary with the health plan.

3. What therapies (physical, occupational, speech, etc) are covered? What limitations, if any, are placed on therapies?

Therapies are not usually covered if they do not significantly enhance or increase the patient's function or productivity, or care provided after the patient has reached rehabilitative potential.

All therapies are usually a covered benefit. The Evidence of Coverage should be reviewed to determine the criteria which are used to define medical necessity of these benefits. For Medicare and Medicaid beneficiaries, these benefits may be interpreted very strictly. Employers will sometimes put specific limits on the number of visits that are covered under the health plan; employees may be unaware of these restrictions.

Another area of confusion for individuals is that the health plan will often approve a certain number of visits for a given time period. The number of visits may be increased, depending upon medical necessity. However, individuals sometimes interpret the prior authorization for a limited number of visits to be the total visits allowed and are not aware that may be subject to change depending upon the individual's condition.

The individual usually needs a written referral from the health plan signed by the primary care physician to obtain therapy services.

4. What specific vision services are covered?

This information is described in the Evidence of Coverage statement received from the health plan. Individuals need to review the Evidence of Coverage for the amount of money and/or type of visits which are covered under this benefit. Health plans offering these services for Medicare beneficiaries, usually have very limited benefits. The health plan usually also has a contract with a specific eye care practice for these services. Referral procedures vary with the health plan.

5. What experimental procedures are covered?

Experimental procedures are generally not a covered benefit under a health plan. However, some procedures may be covered by selected health plans. Medicare and Medicaid do not traditionally pay for experimental procedures, therefore, experimental procedures are not usually covered by health plans offering these services through these programs. The Evidence of Coverage statement has a list of the procedures which are not covered.

6. Can I choose any hospital, home health agency, nursing home or rehabilitation agency if I need that type of treatment? Must I get approval before receiving any of these services?  Who must get approval - my physician or me? (If me, whom do I call?)

The health plan has contracts with hospital(s), home health agency(ies), nursing home(s) and rehabilitation agency(ies). These institutions have agreed to provide services to patients of the health plan for an agreed upon fee. Therefore, individuals must use these providers. Health plans do annual contracts with these agencies. It is important to note that these agencies may change annually. Usually the physician is required to obtain written approval from the health plan for services received in any of these institutions, however, in some cases the physician may write an order and have the patient obtain approval.

7. What durable medical equipment (wheelchair, bath bench, walker, etc) is covered?

Medical equipment is usually a covered benefit, if it is medically necessary. The Evidence of Coverage should be reviewed to determine the criteria and definitions which are used to define medical necessity for these benefits. For Medicare and Medicaid beneficiaries, these benefits may be interpreted very strictly. Employers will sometimes put specific limits on the number and types of medical equipment that are covered under the health plan; employees may be unaware of these restrictions.

Another area of confusion for individuals is that the health plan will often approve certain types of equipment for a given time period. The types of equipment may be changed, depending upon medical necessity. However, individuals sometimes interpret the prior authorization for specific equipment to be the only equipment allowed. Additional equipment may be approved subject to change in the individual's condition.

It is important to also note that the health plan has a contract with specific agencies to provide equipment to their patients. The individual must receive the equipment from the supplier with whom the health plan has a contract usually with a written approval from the health plan signed by the primary care physician. This contract may change annually.

8. What disposable supplies (foley catheter tubing, syringes, diapers, etc) are covered?

Disposable supplies may be a covered benefit, if they are medically necessary. The Evidence of Coverage should be reviewed to determine the criteria and definitions that are used to define medical necessity for these benefits. For Medicare and Medicaid beneficiaries, these benefits may be interpreted very strictly. Employers will sometimes put specific limits on the number and types of disposable supplies that are covered under the health plan; employees may be unaware of these restrictions.

Another area of confusion for individuals is that the health plan will often approve a certain types of supplies for a given time period. The number of supplies and the duration may be increased, depending upon medical necessity. However, individuals sometimes interpret the prior authorization for specific supplies to be the only supplies allowed. Additional supplies may be approved subject to change in the individual's condition.

It is important to also note that the health plan has a contract with specific agencies to provide disposable supplies to their patients. The individual must receive the disposable supplies from the supplier with whom the health plan has a contract usually with written approval from the health plan signed by the primary care physician. This contract may change annually.

9. What oxygen services are covered?

Oxygen may be a covered benefit, if it is medically necessary. The Evidence of Coverage should be reviewed to determine the criteria and definitions that are used to define medical necessity for these benefits. For Medicare and Medicaid beneficiaries, these benefits may be interpreted very strictly. Employers will sometimes put specific limits on the number and types of medical equipment that is covered under the health plan; employees may be unaware of these restrictions.

Another area of confusion for individuals is that the health plan will often approve a certain amount of oxygen for a given time period. The amount of oxygen may be increased, depending upon medical necessity. However, individuals sometimes interpret the prior authorization for the specific amount of oxygen to be the only order for oxygen which is allowed. Additional oxygen may be approved subject to change in the individual's condition.

It is important to also note that the health plan has a contract with specific agencies to provide oxygen to their patients. The individual must receive oxygen from the supplier with whom the health plan has a contract usually with written approval from the health plan signed by the primar care physician. This contract may change annually.

10.What assessments are used to determine if I am eligible for continued services? Durable Medical Equipment? Therapy? Home Health Care? Nursing Care?

Health plans use a variety of assessment tools to determine the type and amount of care that is needed. Most assessment tools measure outcomes based upon the treatment that is authorized. These assessment tools are used to determine if the treatment plan is effective and meeting both the patient's goals and those of the health plan.

The health plans do not use the same standardized assessment tool. The health plans try to ensure that care is cost-effective. A tool known as the Functional Independence Measure is used in many settings to determine level of function. These assessment tools may not necessarily be appropriate for the type of function that is being measured. For example, one health plan used a measurement criteria "ability to drive an automobile" to determine the continued need for physical therapy in a nursing home for a stroke victim who was clinically unable to regain mobility, but whose treatment goals included the ability to assist in transfers and to make her needs known.

11. What is the obstetric (pregnancy, childbirth) benefit?

Individuals should read the Evidence of Coverage for information on coverage for pre-natal care, delivery and after care. Individuals should also read the Evidence of Coverage for the coverage for a newborn, especially a newborn with severe health problems or birth defects needing intensive care services. The health plan may have a limit on the number of services and the amount of money which will be spent on such care.

The health plan usually has specific procedures for enrolling the newborn. Consult the Evidence of Coverage for specific procedures.

Health plans may also not pay for alternative birthing methods such as mid-wives, home births and so forth.

Health plans usually do not cover counseling, therapy, special education, diagnostic testing, medications, or care for learning deficiencies and behavioral problems whether or not they are associated with a manifest mental disorder, retardation, or other disturbance.

Some health plans may limit the liability of the obstetric benefit. Obstetrics may not be a covered benefit. This sometimes happens when the employer is paying for the health care coverage; employees may not be aware of these limitations.

Individuals who have an infant or a small child needing significant medical care which is not paid for by the health plan, should apply for Supplemental Security Income through the local office of the Social Security Administration, so they will be eligible for Medicaid coverage.

Prescription Benefits

1. What is the prescription drug benefit? Is my physician limited by the formulary in the medications that can be prescribed?
Will I automatically be given a generic equivalent drug (unless my physician states otherwise on the prescription?)  If I need a brand-name drug, will I be able to get it? How much will it cost me? What is the process for getting the brand-name drug? If I need a biologic (blood, plasma, etc), will I be able to get it? How much additional will it cost? Is there a limitation on the amount of prescription drugs available?   Annually? Lifetime? Is there a limitation on the amount of prescription drugs available? Annually? Lifetime? What is the policy for using therapeutic substitutions? Are experimental medications covered?   Can I have a copy of the formulary?    If yes, how do I get one? Does the physician benefit financially if I get generic drugs versus brand name drugs?  If this information is not available, how do I find out? How is the pharmacy reimbursed? Capitation? Fee for service? Salary? Bonuses?

Health plans may offer a prescription drug benefit which usually has a maximum annual cash limitation. The prescription drug benefit uses a list of prescription drugs that are known as a formulary. The formulary usually contains medications which are generic drugs because the patent has expired, and therefore, the drugs are usually cheaper. These drugs which are older may work for some individuals. Often, they have undesirable side effects. Newer drugs, which may not be on the formulary, are usually more expensive, may have different chemical substances and have fewer side effects. Copies of the formularies should be available from the health plan upon request through member services.

To calculate the prescription drug benefit, the individual needs to calculate the amount the pharmacy charged the health plan for the prescription drugs. The individual then needs to deduct the co-payment to determine the amount of the prescription drug benefit which has been utilized.

Under most circumstances, the health plan will want your physician to select drugs from the formulary. The pharmacist can not automatically make a generic substitution without the approval of the physician.

There is some research, particularly the study conducted by Susan Horn at the University of Utah, which indicates that utilization of a restricted formulary by a health plan saves money in the pharmacy budget, but the hospital budget was higher than those health plans which did not have a restricted formulary. The conclusion of the study was that health plans without a restricted formulary had lower overall health care costs than those with restricted formularies.

If the physician prescribes a name brand drug, it may be covered by the health plan with approval. Check the Evidence of Coverage to determine the procedure for obtaining a brand name drug, if your physician prescribes one. The co-payment may also be higher for a brand name drug. You may also have to pay the full price for a brand name drug, depending upon your policy. Medicare beneficiaries under some of the health plans can get brand name drugs for the cost of the drug, for the same co-payment for generic drug or brand name drugs because the formulary is not restricted, or a maximum co-payment which has been negotiated with Health Care Financing Administration (Medicare).

Most health plans have a maximum amount they will pay annually for either an individual or a family. Some health plans may also have a lifetime maximum. These provisions are extremely important for individuals who have chronic diseases and who need large dosages or many different medications.

Biologics such as blood and plasma may or may not be covered by the health plan. There may also be limits on the amount of blood or plasma which is available per year or per lifetime. Medicare beneficiaries are entitled to receive biologics as one of the health plan benefits since they are a Medicare benefit. To determine if biologics are a covered benefit, check the Evidence of Coverage statement.

Under the pharmacy practice act, the pharmacist can not make therapeutic substitutions. Therefore, the pharmacist can not change the prescription to a drug which has a different chemical compound, but may have the same potential outcome for a patient. Usually when this type of action occurs, the pharmacist offers you a cheaper drug that is not chemically the same as the prescribed drug. Therapeutic substitutions are different than generic drugs.

Under some physician contracts with health plans, the physician financially benefits if the individual uses generic drugs versus name brand name drugs. Under the concept of alignment of incentives, the health plan may negotiate with physicians or groups of physicians that if the utilization of prescription drugs is under a certain target amount, the physician may receive some reimbursement from the pharmacy "pool of monies". Not all physicians have this type of contract with the health plan.

2. Are dietary supplements covered, if prescribed by a physician?    Are metabolic foods covered, if prescribed by a physician?

Dietary supplements and metabolic foods may or may not be covered. These food replacement products may not be covered because the health plan does not cover food for other patients. Medicaid will pay for dietary supplements for their beneficiaries.

Mental Health Checklist - Coverage

1. Is the meaning of "Medical Necessity" clearly defined and based upon appropriate medical/psychological care?

Mental illness is a clinically significant behavioral or psychological syndrome or pattern that is associated with distress or disability, or with a significantly increased risk of suffering death, pain, disability, or an important loss of freedom, and for which improvement can be expected with treatment. Mental illness is usually defined using the Diagnostic and Statistical Manual of Mental Disorders-IV-Revised for services covered by Medicare. Other health plans may base their definitions on the American Psychiatric Association's guidelines.

Recent national legislation will soon require insurers and employers to treat mental health diagnoses the same as diagnoses for physical conditions. Thus mental health conditions should not be subject to the same types of limits as previously. The meaning of medical necessity for mental health services is usually the same or similar to the definitions used for physical conditions.

2. How is my provider compensated?
Capitation?  Fee for Service?  Bonuses?

At this time, the mental health provider is usually reimbursed on a capitated system. This means the mental health provider gets a set amount, say $3 per patient per month enrolled in the health plan. The mental health provider is responsible for the inpatient, as well as outpatient, services needed by all of the members of the health plan. The mental health provider assumes some of the risk in providing care.

The second type of payment structure is cost approach. Under this type of arrangement, the mental health provider is reimbursed a set fee, but only if the patient is seen. The health plan assumes all of the risk in providing care.

The third type of payment structure is salary. In this type of health plan, the mental health provider is paid a set salary each month from the health plan. The salary is pre-determined, regardless of reimbursement structures to the health plan.

Bonuses are a matter of business practice in many organizations. Bonuses are usually awarded at the end of the contract year, based upon the financial performance of the company. Non-profit organizations may share the net income over expenses with employees and health care providers, rather than awarding bonuses.

3.Are alcohol and substance abuse covered?  If yes, what is the benefit?

Colorado law requires that alcohol and substance abuse be a covered benefit in all health plans. Thus the health plan must pay for detoxification. Inpatient care, outpatient care, aftercare are optional services that can be purchased by the individual or the employer.

For Medicare beneficiaries, coverage is provided for medically necessary inpatient or outpatient substance abuse services limited to physical detoxification when provided under the direction of the mental health provider or other health plan designee. Outpatient substance abuse services can include evaluations, diagnostic and therapeutic services under the direction of the mental health provider or other health plan designee. Inpatient substance abuse services can be provided when medically necessary. These include room and board as well as evaluations, diagnostic, and therapeutic services in a semi-private room when ordered, provided or arranged under the mental health provider or health plan designee.

4. How many sessions are covered and how is that number determined (utilization review)? What are the co-pays or deductibles for these services?

To determine the number of sessions that are covered it is necessary to read the Evidence of Coverage statement. In employer sponsored plans, it is also necessary to determine if the company has purchased coverage above the minimum state requirements.

The number of sessions for individuals who are Medicare beneficiaries is determined by medical necessity using Medicare guidelines.

The co-pays and deductibles are determined by the Evidence of Coverage. Employer based plans have the option to determine the amount of the co-pay and deductibles. The co-pay for Medicare beneficiaries is determined by the contract with the Health Care Financing Administration (Medicare).

5. Are preventive mental health services, such as smoking cessation, parenting classes or conflict resolution offered? What is the co-payment for these services?

To determine if preventive mental health services are covered, the individual must check the Evidence of Coverage statement. These are optional services that may be purchased. Most preventive mental health services are not covered for Medicare beneficiaries, because they are not a covered Medicare benefit.

The co-payment for these optional services can be found in the Evidence of Coverage statement.

6. What is the prescription drug benefit? Is my psychiatrist limited by the formulary in the medications that can be prescribed?  Will I automatically be given a generic equivalent drug (unless my psychiatrist states otherwise on the prescription)? If I need a brand name drug, will I be able to get it? How much additional will it cost me? What is the process for getting the brand name drug? Is the prescription drug benefit for mental health included in the total (physical and mental) prescription benefit, or is it separate?

A separate prescription drug benefit for mental health purposes does not usually exist. To determine the process for obtaining medications from the psychiatrist, contact the mental health provider. Generic drugs are usually the preferred treatment modality, however, the same rules usually apply for brand name drugs for mental health diagnosis, as for physical conditions.

Mental Health Checklist - Access

1.What type of plan do I have?  HMO?  PPO?  Point of Service? Other?
Check the Evidence of Coverage statement to determine the type of plan.

2. How do I get help? Do I call my managed care company first?
For the most part, the mental health provider operates somewhat independently of the primary care physician. The individual can usually make a self referral to the mental health provider. The health plan does not usually need to be notified.

3. How do I get a list of mental health practitioners in my plan? In the Evidence of Coverage statement, the mental health provider will be identified. The individual can contact the mental health provider for a list of available practitioners who are approved to treat patients in the health plan.

4. Can I choose my own therapist within the plan, or will I be assigned to a practitioner?
Usually the individual will be allowed to select their own therapist who practices with the mental health provider.

5. Do I have to get a referral from my primary care physician?
Who approves my mental health care?

Usually the individual does not have to get a referral from the primary care physician for mental health services. However, the individual should check the Evidence of Coverage for the procedure to be used. Usually the mental health provider approves the mental health care using their own utilization review processes to determine medical necessity.

6. What is the procedure for changing practitioners?

The procedure for changing practitioners is to contact the mental health provider and indicate the desire to change practitioners. Usually, the individual can change to a new practitioner in the mental health provider organization upon request.

7.  Are treatment guidelines and standards open to the public?

Usually treatment guidelines and standards are open to members who request this information. General practice philosophy and accreditation information is usually public information. Specific information about the group's practice is usually available upon request.

Mental Health Checklist - Confidentiality

1. Will identifiable information about my diagnosis, length of treatment or other psychological care or medical information be accessible to my employer or other parties who have no right to that information?

Employers do not receive confidential information about a particular patient from the health plan. They will however, receive aggregate data which identifies such things as number of visits, types of diagnoses, number of hospitalizations and so forth. State law prohibits the health plan from releasing specific information about a specific individual to an employer.

It should be noted, that in a small business, the employer may be very knowledgeable about a particular individual or group of individuals because of the nature of the small business. For example, if an individual in a small company has been diagnosed with manic depressive disorder, many of the individual's colleagues as well as management may be aware of the need for frequent physician visits, mood changes, and other similar activities related to the nature of the mental condition.

For a list of Medicare Advantages in your area go to: www.medicare.gov