INTERIM FINAL RULES FOR GROUP HEALTH PLANS AND HEALTH INSURANCE ISSUERS RELATING TO INTERNAL CLAIMS AND APPEALS AND EXTERNAL REVIEW PROCESSES UNDER THE PPACA
Department of the Treasury, Internal Revenue Service
Department of Labor, Employee Benefits Security Administration
Department of Health & Human Services
September 21, 2010, applicable to non-grandfathered group health plans and health insurance issuers for plan years beginning on/after September 23, 2010.
Link to Interim Final Rule:
Link to Department of Labor Fact Sheet:
Internal Claims and Appeals Process
A group health plan and health insurance issuer offering group health coverage must comply with all the requirements applicable to group health plans under the Department of Labor’s claims procedure regulation (29 CFR 2560.503-1) and six new requirements:
Definition of an adverse benefit determination is broadened to include a rescission of coverage.
In general, notice by plan/issuer of a claimant of a benefit determination (whether adverse or not) in an urgent care claim (as defined in DoL’s claims procedure regulation) not later than 24 hours (formerly 72 hours) after receipt of the claim.
Additional criteria to ensure a claimant receives full and fair review: Plan/issuer must timely provide claimant, free of charge, with any new/additional evidence considered, relied upon, or generated by the plan/issuer (or at the direction of the plan/issuer) in connection with the claim. Before an adverse benefit determination can be issued based on new/additional rationale, the claimant must be timely provided with the rationale.
New criteria with respect to avoiding conflicts of interest: decisions regarding hiring, compensation, termination, promotion, or other similar matters with respect to any individual (such as a claims adjudicator or medical expert) must not be based upon the likelihood that the individual will support a denial of benefits.
- New standards regarding notice to enrollees: plan/issuer must provide notices to enrollees in a culturally and linguistically appropriate manner. This requirement is based on thresholds of the number of people who are literate in the same non-English language. Further, a plan/issuer must include in any notice of adverse benefit determination or final internal adverse benefit determination the following claim-specific information:
Date of service.
Health care provider.
Diagnosis code and corresponding meaning.
Treatment code and corresponding meaning.
Denial code and corresponding meaning.
Description of plan’s/issuer/s standard, if any, that was used in denying claim. If a notice of final internal adverse benefit determination, description must include a discussion of the decision. Plan/issuer must provide a description of available internal appeals and external review processes. Plan/issuer must disclose the availability of, and contact information for, any applicable office of health insurance consumer assistance or ombudsman established under section 2793 of the Public Health Service Act to assist enrollees with internal claims and external review processes.
6. Where plan/issuer fails to strictly adhere to all the requirements of the internal claims and appeals process,
claimant may initiate an external review and pursue any available remedies under applicable law, such as
Pending the outcome of an internal appeal, plan/issuer must continue to provide coverage.
External Review/State Standards
Issuers providing health insurance coverage that are subject to a State external review process that includes, at a minimum, the consumer protections of the National Association of Insurance Commissioners’ (NAIC) Uniform Health Carrier External Review Model Act in place on July 23, 2010, must comply with the applicable State external review process and not with the Federal external review process. The Department of Health & Human Services will determine whether a State external review process meets the requirements of the NAIC Model Act.
Existing State external review processes will be treated as meeting the minimum standards during a transition period for plan years beginning before July 1, 2011.
External Review/Federal Standards
The Departments of Treasury, Labor, and Health & Human Services will establish standards governing an external review process that is similar to the State external appeals process that meets the standards set forth in these regulations. The scope of the Federal external review process does not extend to adverse benefit determinations or final internal adverse benefits determinations that relates to a participant’s or beneficiary’s failure to meet the requirements for eligibility under the terms of a group health plan.
Any plan/issuer not subject to a State external review process must comply with the Federal external review process.
Technical guidance on the interim Federal external review process for non-grandfathered self-insured group health plans
Link to Technical Release: www.dol.gov/ebsa/pdf/ACATechnicalRelease2010-01.pdf
On August 23, 2010, the U.S. Department of Labor, Employee Benefits Security Administration (EBSA) issued Technical Release 2010-10 setting forth an “interim enforcement safe harbor for non-grandfathered self-insured group health plans not subject to a State external review process, and therefore subject to the Federal external review process … (applying) for plan years beginning on or after September 23, 2010 and until superseded by future guidance ....” The Technical Release details procedures for both standard and expedited external review for self-insured group health plans and states that enforcement action will not be taken against any plan that either (1) “complies with the procedures set forth in this technical release; or (2) “voluntarily complies with the provisions of a State external review process that would not otherwise be applicable or available.”
Additional helpful links:
NAIC Model Act:
Model Notice of Adverse Benefit Determination:
Model Notice of Final Internal Adverse Benefit Determination:
Model Notice of Final External Review Decision: