US Laws, Codes, Statutes & Cases

                                  TITLE  41
                                  INSURANCE
                                  CHAPTER 39
                             MANAGED CARE REFORM
    41-3930.  UTILIZATION MANAGEMENT PROGRAM REQUIREMENTS. (1) All managed
care organizations performing utilization management or contracting with third
parties for the performance of utilization management shall:
    (a) Adopt utilization management criteria based on sound patient care and
    scientific principles developed in cooperation with licensed physicians
    and other providers as deemed appropriate by the managed care
    organization. Such criteria shall be sufficiently flexible to allow
    deviations from norms when justified on a case-by-case basis;
    (b) Adopt procedures for a timely review by a licensed physician, peer
    provider or peer review panel when a claim has been denied as not
    medically necessary or as experimental. The procedure shall provide for a
    written statement of the reasons the service was denied and transmittal of
    that information to the appropriate provider  for inclusion in the
    member's permanent medical record;
    (c) Upon enrollment, require members to provide written authorization for
    the release of medical information to the managed care organization;
    (d) Adopt procedures which protect the confidentiality of patient health
    records. Such procedures may permit a managed care organization to record
    a telephone conversation in the course of requesting patient medical
    information only if it complies with existing state and federal laws and
    the other party to the conversation is notified by voice message that he
    is being recorded. Upon written request and within a reasonable time, a
    copy of such recordings shall be provided to the other party to the
    conversation if the recorded conversation becomes an issue in a formal
    grievance procedure, and the other party agrees to reimburse the managed
    care organization for reasonable costs associated with providing the
    requested copy.
    (2)  If emergency services are offered, no managed care organization shall
require prior authorization for emergency services. In addition, a managed
care organization shall respond to member or provider requests for prior
authorization of a nonemergency service within two (2) business days after
complete member medical information  is provided to the managed care
organization unless exceptional circumstances warrant a longer period to
evaluate a request. Qualified medical personnel shall be available during
normal business hours for telephone responses to inquiries about medical
necessity, including certification of continued length of stay.
    (3)  When prior approval for a covered service is required of and obtained
by or on behalf of a member, the approval shall be final and may not be
rescinded by the managed care organization after the covered service has been
provided except in cases of fraud, misrepresentation, nonpayment of premium,
exhaustion of benefits or if the member for whom the prior approval was
granted is not enrolled at the time the covered service was provided.