Executive Summary

Report

Recommendations

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Press Release

Report (PDF format)

Conclusions and
Recommendations

Our assessment of the independent review process indicates that it works to balance the fiscally motivated decisions of insurers and helps consumers gain access to their health benefits. In areas where independent reviewers generally agree with HMO determinations, the process helps to manage high cost care like the prescription drugs identified in this report.

• The Texas experiment with independent review of medical necessity has helped consumers and provided a balancing influence in the spectrum of care. The independent review system should be expanded to include ERISA plans through final passage of federal legislation, and should cover consumers in all states. (The U.S. Supreme Court could rule to make independent review available to ERISA insured.)
  
  
• The Texas Department of Insurance should regularly conduct a substantive review of Independent Review decisions and identify procedures or conditions where the reviewers tend to overturn HMO decisions. TDI should direct HMOs to review their internal guidelines for these conditions and correct them to avoid unnecessary requests for review. Workers Compensation rules already prohibit insurers from denying care once an underlying rationale has been discredited by reviewers.
  
  
• Health plans should review and modernize their guidelines for approval of gastric bypass, eating disorders, and substance abuse care. Patients who meet medical standards (including severely addicted individuals needing inpatient detoxification) should be granted access to a higher level of care (surgery, inpatient treatment). Not all conditions can be adequately treated using outpatient methods, although they might be less expensive initially.
  
  
• Independent review decisions, with all information that would identify the individual redacted, should be posted on the internet as now required only for independent review of workers compensation claims.
  
  
• The independent review statute should be amended to clearly apply to retrospective reviews. In the meantime, TDI should clarify by rule the criteria used to determine whether a denial is a "concurrent" review or a "retrospective" review for purposes of denying consumer access to the independent review process.
  
  
• Employer groups covered by ERISA are not subject to this law, but employees would benefit from this process if it were provided voluntarily. The Texas Department of Insurance should survey employers and Third Party Administrators to determine whether they use the independent review process.
  
  
• Workers denied treatment under workers compensation will have access to the same review process as other managed care patients for the first time this year. The changes may significantly affect the way the IRO system works and should be monitored carefully. So far, few reviews have been requested. Once the system is well started, TWCC should assess whether the fee requirements create too great a disincentive for the provider to fight for patient care.