In its first year reviewing HMO care decisions, the Maryland Insurance Administration conducted 91 full investigations and reversed the HMO about half the time, according to a new report.
Insurance regulators received 1,063 complaints during the year, but more than 70 percent involved issues that were not subject to the appeals process. In 109 cases, the HMO reversed itself during the course of the review. In another 110 cases, the patient withdrew the complaint.
Of the cases that went through full investigations, the regulators upheld the HMO decision not to cover services 45 times. They modified the HMO's decision seven times and reversed it in 39 cases, including ordering inpatient care for a suicidal 14-year-old; directing an HMO to buy an electric wheelchair for a patient; and approving breast reduction surgery as medically justified after the HMO had decided the procedure would be simply cosmetic.
Those orders "reflect that the system is working and that necessary care is going to be delivered," said Steven B. Larsen, state insurance commissioner. He called Maryland's review process "one of the strongest programs in the country."
Maryland was one of the first states to set up a process to review health maintenance organization decisions, amid debate over whether such reviews would protect patients or add needlessly to the cost of health insurance. The state passed the law in 1998, and the reviews began in January 1999. Congress is considering a national law creating a right to appeals outside the HMO's review process.
In Maryland, patients can appeal if an HMO decides that care is not "medically necessary." Doctors can also appeal on behalf of their patients, and many do -- about two-thirds of the complaints last year came from physicians, hospitals and other providers.
According to the report, the majority of complaints were found to be outside the scope of the appeals procedure. Some involved Medicare, Medicaid or employer self-insured plans, which the state cannot regulate. In some cases, the patient had not completed an internal appeal at the HMO. And in others, the dispute was about what the contract covered, not about medical necessity.
When there is a dispute about whether care is needed, insurance regulators turn over the case records to independent medical reviewers. Then, Larsen can issue an order, which is subject to an appeal hearing. So that patients are not waiting months for a decision, the whole process must be completed in 30 days.
Insurers expressed satisfaction yesterday with the new system. "It's been a good process," said Jodi Cichetti, manager of the central appeals unit for CareFirst BlueCross BlueShield. Although more than 800 complaints were logged against her company, the state's largest insurer, only about a half-dozen went through a full review.
In some cases, before the review was finished, additional documentation provided by doctors convinced CareFirst that the service should have been covered, she said.
Walter J. Cherniak Jr. , a regional spokesman Aetna U.S. Healthcare, said, "Our experience has been generally positive, although we do believe it could be made more efficient." According to the Insurance Administration's report, the cost of creating the appeals and a related Health Education and Advocacy Unit in the attorney general's office was $1.3 million for the first year. The insurers pay the cost, based on their share of health insurance premiums.