§ 4914 — Procedures for external appeals of adverse determinations

§ 4914. Procedures for external appeals of adverse determinations. (a)\nThe superintendent shall establish procedures by regulation to randomly\nassign an external appeal agent to conduct an external appeal, provided\nthat the superintendent may establish a maximum fee which may be charged\nfor any such external appeal, or the superintendent may exclude from\nsuch random assignment any external appeal agent which charges a fee\nwhich he deems to be unreasonable.\n (b) (1) The insured shall have four months to initiate an external\nappeal after the insured receives notice from the health care plan, or\nsuch plan's utilization review agent if applicable, of a final adverse\ndetermination or denial, or after both the plan and the insured have\njointly agreed to waive any internal appeal, or after the insured is\ndeemed to have exhausted or is not required to complete any internal\nappeal pursuant to section 2719 of the Public Health Service Act, 42\nU.S.C. § 300gg-19. Where applicable, the insured's health care provider\nshall have sixty days to initiate an external appeal after the insured\nor the insured's health care provider, as applicable, receives notice\nfrom the health care plan, or such plan's utilization review agent if\napplicable, of a final adverse determination or denial or after both the\nplan and the insured have jointly agreed to waive any internal appeal.\nSuch request shall be in writing in accordance with the instructions and\nin such form prescribed by subsection (e) of this section. The insured,\nand the insured's health care provider where applicable, shall have the\nopportunity to submit additional documentation with respect to such\nappeal to the external appeal agent within the applicable time period\nabove; provided however that when such documentation represents a\nmaterial change from the documentation upon which the utilization review\nagent based its adverse determination or upon which the health plan\nbased its denial, the health plan shall have three business days to\nconsider such documentation and amend or confirm such adverse\ndetermination.\n (2) The external appeal agent shall make a determination with regard\nto the appeal within thirty days of the receipt of the request therefor,\nsubmitted in accordance with the superintendent's instructions. The\nexternal appeal agent shall have the opportunity to request additional\ninformation from the insured, the insured's health care provider and the\ninsured's health care plan within such thirty-day period, in which case\nthe agent shall have up to five additional business days if necessary to\nmake such determination. The external appeal agent shall notify the\ninsured, the insured's health care provider where appropriate, and the\nhealth care plan, in writing, of the appeal determination within two\nbusiness days of the rendering of such determination.\n (3) Notwithstanding the provisions of paragraphs one and two of this\nsubsection, if the insured's attending physician states that a delay in\nproviding the health care service would pose an imminent or serious\nthreat to the health of the insured, or if the insured is entitled to an\nexpedited external appeal pursuant to section 2719 of the Public Health\nService Act, 42 U.S.C. § 300gg-19, the external appeal shall be\ncompleted within no more than seventy-two hours of the request therefor\nand the external appeal agent shall make every reasonable attempt to\nimmediately notify the insured, the insured's health care provider where\nappropriate, and the health plan of its determination by telephone or\nfacsimile, followed immediately by written notification of such\ndetermination.\n (4) (A) For external appeals requested pursuant to paragraph one of\nsubsection (b) of section four thousand nine hundred ten of this title,\nthe external appeal agent shall review the utilization review agent's\nfinal adverse determination and, in accordance with the provisions of\nthis title, shall make a determination as to whether the health care\nplan acted reasonably and with sound medical judgment and in the best\ninterest of the patient. When the external appeal agent makes its\ndetermination, it shall consider the clinical standards of the plan, the\ninformation provided concerning the patient, the attending physician's\nrecommendation, applicable and generally accepted practice guidelines\ndeveloped by the federal government, national or professional medical\nsocieties, boards and associations. Provided that such determination\nshall:\n (i) be conducted only by one or a greater odd number of clinical peer\nreviewers,\n (ii) be accompanied by a notice of appeal determination which shall\ninclude the reasons for the determination; provided, however, that where\nthe final adverse determination is upheld on appeal, the notice shall\ninclude the clinical rationale, if any, for such determination,\n (iii) be subject to the terms and conditions generally applicable to\nbenefits under the evidence of coverage under the health care plan,\n (iv) be binding on the plan and the insured, and\n (v) be admissible in any court proceeding.\n (B) For external appeals requested pursuant to paragraph two of\nsubsection (b) of section four thousand nine hundred ten of this title,\nthe external appeal agent shall review the proposed health service or\nprocedure for which coverage has been denied and, in accordance with the\nprovisions of this title and the external agent's investigational\ntreatment review plan, make a determination as to whether the patient\ncosts of such health service or procedure shall be covered by the health\ncare plan; provided that such determination shall:\n (i) be conducted by a panel of three or a greater odd number of\nclinical peer reviewers,\n (ii) be accompanied by a written statement:\n (a) that the patient costs of the proposed health service or procedure\nshall be covered by the health care plan either: when a majority of the\npanel of reviewers determines, based upon review of the applicable\nmedical and scientific evidence and, in connection with rare diseases,\nthe physician's certification required by subsection (g-7) of section\nfour thousand nine hundred of this article and such other evidence as\nthe insured, the insured's designee or the insured's attending physician\nmay present (or upon confirmation that the recommended treatment is a\nclinical trial), the insured's medical record, and any other pertinent\ninformation, that the proposed health service or treatment (including a\npharmaceutical product within the meaning of subparagraph (B) of\nparagraph two of subsection (e) of section four thousand nine hundred of\nthis article) is likely to be more beneficial than any standard\ntreatment or treatments for the insured's condition or disease or, for\nrare diseases, that the requested health service or procedure is likely\nto benefit the insured in the treatment of the insured's rare disease\nand that such benefit to the insured outweighs the risks of such health\nservice or procedure (or, in the case of a clinical trial, is likely to\nbenefit the insured in the treatment of the insured's condition or\ndisease); or when a reviewing panel is evenly divided as to a\ndetermination concerning coverage of the health service or procedure, or\n (b) upholding the health plan's denial of coverage;\n (iii) be subject to the terms and conditions generally applicable to\nbenefits under the evidence of coverage under the health care plan,\n (iv) be binding on the plan and the insured, and\n (v) be admissable in any court proceeding.\n As used in this subparagraph (B) with respect to a clinical trial,\npatient costs shall include all costs of health services required to\nprovide treatment to the insured according to the design of the trial.\nSuch costs shall not include the costs of any investigational drugs or\ndevices themselves, the cost of any nonhealth services that might be\nrequired for the insured to receive the treatment, the costs of managing\nthe research, or costs which would not be covered under the policy for\nnoninvestigational treatments.\n (C) For external appeals requested pursuant to paragraph three of\nsubsection b of section four thousand nine hundred ten of this title\nrelating to an out-of-network denial, the external appeal agent shall\nreview the utilization review agent's final adverse determination and,\nin accordance with the provisions of this title, shall make a\ndetermination as to whether the out-of-network health service shall be\ncovered by the health plan.\n (i) The external appeal agent shall assign one clinical peer reviewer\nto make a determination as to whether the out-of-network health service\nis materially different from the alternate recommended in-network health\nservice.\n (ii) If a determination is made that the out-of-network health service\nis not materially different from the alternate recommended in-network\nhealth service, the out-of-network health service shall not be covered\nby the health plan.\n (iii) If a determination is made that the out-of-network health\nservice is materially different from the alternate recommended\nin-network health service, the external appeal agent shall assign a\npanel with an additional two or a greater odd number of clinical peer\nreviewers, which shall make a determination as to whether the\nout-of-network health service shall be covered by the health plan;\nprovided that such determination shall:\n (I) be accompanied by a written statement:\n (1) that the out-of-network health service shall be covered by the\nhealth care plan either: when a majority of the panel of reviewers\ndetermines, upon review of the treatment requested by the insured, the\nalternate recommended health service proposed by the plan, the clinical\nstandards of the plan, the information provided concerning the insured,\nthe attending physician's recommendation, the applicable medical and\nscientific evidence, the insured's medical record, and any other\npertinent information that the out-of-network health service is likely\nto be more clinically beneficial than the alternate recommended\nin-network health service and the adverse risk of the requested health\nservice would likely not be substantially increased over the in-network\nhealth service; or\n (2) uphold the health plan's denial of coverage;\n (II) be subject to the terms and conditions generally applicable to\nbenefits under the evidence of coverage under the health care plan;\n (III) be binding on the plan and the insured; and\n (IV) be admissible in any court proceeding.\n (D) For external appeals requested pursuant to paragraph four of\nsubsection (b) of section four thousand nine hundred ten of this title\nrelating to an out-of-network referral denial, the external appeal agent\nshall review the utilization review agent's final adverse determination\nand, in accordance with the provisions of this title, shall make a\ndetermination as to whether the out-of-network referral shall be covered\nby the health plan; provided that such determination shall:\n (i) be conducted only by one or a greater odd number of clinical peer\nreviewers;\n (ii) be accompanied by a written statement:\n (I) that the out-of-network referral shall be covered by the health\ncare plan either when the reviewer or a majority of the panel of\nreviewers determines, upon review of the training and experience of the\nin-network health care provider or providers proposed by the plan, the\ntraining and experience of the requested out-of-network provider, the\nclinical standards of the plan, the information provided concerning the\ninsured, the attending physician's recommendation, the insured's medical\nrecord, and any other pertinent information, that the health plan does\nnot have a provider with the appropriate training and experience to meet\nthe particular health care needs of an insured who is able to provide\nthe requested health service, and that the out-of-network provider has\nthe appropriate training and experience to meet the particular health\ncare needs of an insured, is able to provide the requested health\nservice, and is likely to produce a more clinically beneficial outcome;\nor\n (II) upholding the health plan's denial of coverage;\n (iii) be subject to the terms and conditions generally applicable to\nbenefits under the evidence of coverage under the health care plan;\n (iv) be binding on the plan and the insured; and\n (v) be admissible in any court proceeding.\n (c) No external appeal agent or clinical peer reviewer conducting an\nexternal appeal shall be liable in damages to any person for any\nopinions rendered by such external appeal agent or clinical peer\nreviewer upon completion of an external appeal conducted pursuant to\nthis section, unless such opinion was rendered in bad faith or involved\ngross negligence.\n (d) (1) Except as provided in paragraphs two and three of this\nsubsection, payment for an external appeal shall be the responsibility\nof the health care plan. The health care plan shall make payment to the\nexternal appeal agent within forty-five days, from the date the appeal\ndetermination is received by the health care plan, and the health care\nplan shall be obligated to pay such amount together with interest\nthereon calculated at a rate which is the greater of the rate set by the\ncommissioner of taxation and finance for corporate taxes pursuant to\nparagraph one of subsection (e) of section one thousand ninety-six of\nthe tax law or twelve percent per annum, to be computed from the date\nthe bill was required to be paid, in the event that payment is not made\nwithin such forty-five days.\n (2) If an insured's health care provider requests an external appeal\nof a concurrent adverse determination and the external appeal agent\nupholds the health care plan's determination in whole, payment for the\nexternal appeal shall be made by the health care provider in the manner\nand subject to the timeframes and requirements set forth in paragraph\none of this subsection.\n (3) If an insured's health care provider requests an external appeal\nof a concurrent adverse determination and the external appeal agent\nupholds the health care plan's determination in part, payment for the\nexternal appeal shall be evenly divided between the health care plan and\nthe insured's health care provider who requested the external appeal and\nshall be made by the health care plan and the insured's health care\nprovider in the manner and subject to the timeframes and requirements\nset forth in paragraph one of this subsection; provided, however, that\nthe superintendent may, upon a determination that health care plans or\nhealth care providers are experiencing a substantial hardship as a\nresult of payment for the external appeal when the external appeal agent\nupholds the health care plan's determination in part, in consultation\nwith the commissioner of health, promulgate regulations to limit such\nhardship.\n (4) If an insured's health care provider was acting as the insured's\ndesignee, payment for the external appeal shall be made by the health\ncare plan. The external appeal and any designation shall be submitted on\na standard form developed by the superintendent in consultation with the\ncommissioner of health pursuant to subsection (e) of this section. The\nsuperintendent shall have the authority upon receipt of an external\nappeal to confirm the designation or request other information as\nnecessary, in which case the superintendent shall make at least two\nwritten requests to the insured to confirm the designation. The insured\nshall have two weeks to respond to each such request. If the insured\nfails to respond to the superintendent within the specified timeframe,\nthe superintendent shall make two written requests to the health care\nprovider to file an external appeal on his or her own behalf. The health\ncare provider shall have two weeks to respond to each such request. If\nthe health care provider does not respond to the superintendent's\nrequests within the specified timeframe, the superintendent shall reject\nthe appeal. If the health care provider responds to the superintendent's\nrequests, payment for the external appeal shall be made in accordance\nwith paragraphs two and three of this subsection.\n (e) The superintendent, in consultation with the commissioner of\nhealth, shall promulgate by regulation a standard description of the\nexternal appeal process established under this section, which shall\nprovide a standard form and instructions for the initiation of an\nexternal appeal by an insured.\n