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Medicaid Contract Purchasing Specifications

Part 1A

Coverage Determination Standards and Procedures

Table of Contents

§101A. Coverage Determination Standards
§102A. Coverage Determination Procedures
§103A. Prior Authorization
§104A. Self-Referral for Certain Services without Prior Authorization
§105A. Coordination of Benefits
§106A. Prior Purchaser Approval

If, as a purchaser, you are interested in purchasing pediatric care for Medicaid-eligible children from managed care organizations on a risk basis, the following language on coverage determination standards is for your consideration.

§101A. Coverage Determination Standards — In making a coverage determination (as defined in subsection (e)) with respect to an enrolled child (including a child with special health care needs and an adolescent), Contractor (and where coverage determinations are delegated to providers participating in Contractor's provider network, such providers) shall comply with the following requirements:

(a) Standard of Coverage¹ — In making coverage determinations (as defined in subsection (e)), Contractor shall apply the following standards:

^K(1) Coverage of each item and service enumerated under Part 1 shall be sufficient in amount, duration and scope to reasonably achieve its purpose in accordance with 42 C.F.R. §440.230(b);

^K(2) Coverage limitations imposed by Contractor shall not result in arbitrary denial or reduction of the amount, duration, or scope of a covered item or service on the basis of an enrolled child's diagnosis, type of illness, or condition, in violation of 42 C.F.R. §440.230(c);

^K(3) Coverage of an item or service shall not be less in amount, duration, or scope than the coverage of such item or service to which an enrolled child is entitled under [drafter insert reference to State Medicaid Plan];

^K(4) With respect to EPSDT items and services described in §§5123.2, 5124, 5150, 5240, and 5310 of the State Medicaid Manual issued by the Health Care Financing Administration, coverage shall be equal in amount, duration, and scope to the coverage described in such Manual;

^L(5) Coverage limitations imposed by Contractor shall comply with the Newborns' and Mothers' Health Protection Act of 1996, §2704 of the Public Health Service Act, 42 U.S.C. §300gg-4, and 29 U.S.C. §1185a, 63 Fed. Reg. 57545 (October 27, 1998);

^L(6) Coverage limitations imposed by Contractor shall comply with the Mental Health Parity Act, §2705 of the Public Health Service Act, 42 U.S.C. §300gg-5, and 29 U.S.C. §1185a;

^K(7) As required by §805(a)(2) of Part 8, coverage limitations imposed by Contractor shall be consistent with the child health supervision guidelines reflecting generally accepted principles of professional pediatric practice enumerated in §006(a)(1) of the Overview²; and

^K(8) Coverage limitations imposed by Contractor shall be consistent with [drafter insert EPSDT periodicity schedule under state Medicaid plan] under §5140 of the State Medicaid Manual issued by the Health Care Financing Administration.

^K(b) Evidence to be Considered in Making Coverage Determinations — In making a coverage determination (as defined in subsection (e)), Contractor shall take into account the following evidence and information if offered on behalf of the enrolled child:

(1) Recommendation of the provider treating the enrolled child for whom the coverage determination must be made;

(2) Clinical evidence of the health status and needs of the enrolled child for whom the coverage determination must be made;

(3) Evidence and information that is provided by the enrolled child or by the enrolled child's family or caregiver;

(4) Opinions of medical, dental and other health care practitioners who are experienced in the treatment of children with mental or physical illnesses or conditions similar to that of the enrolled child with respect to which a coverage determination is being made;

(5) Professional standards of medical, dental and other health care practice related to the care of children, as reflected in:

(A) scientific literature published in peer-reviewed journals;

(B) the results of clinical trials relevant to pediatric care;

(C) government-sponsored studies;

(D) professional consensus statements; and

(E) other sources of valid and reliable evidence regarding the pediatric standard of care;

(6) Opinions of, and evidence supplied by, qualified individuals who are involved in the care of the enrolled child and who are affiliated with [drafter insert names of publicly-supported agencies, programs, or providers delivering health services to children residing in Contractor's service area]; and

(7) Provisions of an Individualized Education Program (IEP) (as defined in §1401(o)) or an Individualized Family Services Plan (IFSP) (as defined in §1401(p)).³

(c) Prohibited Grounds for Denial or Exclusion of Services — Contractor shall not deny, terminate, reduce or exclude coverage in part or in whole of an item or service covered under [drafter insert name of purchasing document] with respect to an enrolled child because:

^L(1)the item or service is required to treat a condition rather than an illness or injury;

^L(2) the item or service will not result in the restoration or achievement of normal functioning;

^K(3) the item or service which is sought is experimental⁴, unless Contractor demonstrates to [drafter insert name of appropriate state agency]

that the item or service is:

(A) available only through a clinical trial, or

(B) not a generally accepted practice or procedure among pediatric specialists;

^K(4) the item or service is identified in a plan of care developed by [drafter insert name of state child welfare agency, state Title V agency or grantee, or other state or local agency];

^K(5) the item or service is a related service in an Individualized Education Program (IEP) (as defined in §1401(o)) or an early intervention service in an Individualized Family Services Plan (IFSP) (as defined in §1401(p)) that would otherwise be covered under [drafter insert reference to State's Medicaid Plan];

^K(6) the item or service is provided in a school setting that would otherwise be covered under [drafter insert reference to State's Medicaid Plan]; or

^K(7) the item or service is required because of a failure of the family or caregiver of the enrolled child to ensure that the child has complied with a recommendation or prescription of the child's treating provider.⁵

^K(d) Special Rule for Coverage of Treatment for Reportable Diseases — In the case of an enrolled child (including an adolescent) with respect to whom [drafter insert name of state or local public health agency] has issued an order for the treatment of a reportable disease, Contractor shall comply with the treatment order by furnishing items and services covered under Part 1 and specified under the order until:

(1) the course of treatment is completed; or

(2) the enrolled child is medically evaluated, the treatment order is reviewed by a provider participating in Contractor's provider network who is qualified to treat the reportable disease with respect to which the treatment order applies, and, based on such evaluation and review, the child's primary care provider initiates an alternative course of treatment.

^K(e) Coverage Determination Defined — A determination by Contractor (or by the provider or other entity to whom Contractor has delegated such determination) as to whether, in the case of an enrolled child, an item or service enumerated under Part 1 is necessary to:

(1) prevent, correct, or ameliorate a condition, disability, illness or injury;

(2) prevent, correct, or ameliorate a developmental disability or delay⁶; or

(3) maintain functioning.⁷

If, as a purchaser, you are interested in purchasing pediatric care for Medicaid-eligible children from managed care organizations on a risk basis, the following language on coverage determination procedures is for your consideration.

^K§102A. Coverage Determination Procedures — In making coverage determinations with respect to an enrolled child, Contractor shall comply with the following requirements:

(a) Determination in Writing — A determination regarding coverage shall be in writing and shall state the factual basis for the determination.

(b) Timely Determination — Contractor shall make a coverage determination within [ ] days of a request for such a determination unless within such time Contractor notifies the enrolled child or the provider requesting such determination that additional information is required. In no event shall Contractor make a coverage determination in more than [ ] days of the request for such determination.

(c) Notice of Determination — Contractor shall provide written copies of a determination regarding coverage within [ ] days of such determinationto:

(1) the enrolled child's family or caregiver (or in the case of an enrolled adolescent, the adolescent);

(2) the enrolled child's primary care provider and pediatric specialist (if any); and

(3) subject to the requirements of §1002 of Part 10 relating to confidentiality protections, [drafter insert name of publicly-supported agency, program, or provider delivering health services to children residing in Contractor's service area] that referred the enrolled child for the item or service at issue.

(d) Notice of Denial or Termination or Reduction — [RESERVED]

(e) Continuation of Coverage — [RESERVED]

(f) Personnel Qualified to Make Coverage Determinations — Contractor shall ensure that determinations regarding the coverage of items and services enumerated in Part 1, including determinations of coverage of items and services for which prior authorization is required, be conducted by:

(1) personnel with training in pediatric health care and qualified through licensure, accreditation, education, experience, orother means, to make coverage determinations regarding the provision of physical, dental, or mental health services to an enrolled child;

(2) in the case of an enrolled adolescent, an individual described in paragraph (1) with experience in treating adolescents;

(3) in the case of an enrolled child with an Individualized Education Program (IEP) (as defined in §1401(o)) or an Individualized Family Services Plan (IFSP) (as defined in §1401(p)), an individual described in paragraph (1) or (2), as appropriate, with expertise in IEPs or IFSPs; and

(4) in the case of an enrolled child who is a racial or ethnic minority, an individual described in paragraph (1), (2), or (3), as appropriate, who is culturally competent (as defined in §1401(i));

(g) Language-Appropriate Determinations — In the case of an enrolled child whose family or caregiver speaks a language other than English that is spoken by more than [ ] enrollees, the written copies of the coverage determination described in subsection (c) shall be in such language.

If, as a purchaser, you are interested in purchasing pediatric care for Medicaid-eligible children from managed care organizations on a risk basis, the following language on prior authorization is for your consideration.

§103A. Prior Authorization

^K(a) In General

(1) Items and Services Subject to Prior Authorization — Contractor shall comply with the requirements of subsection (b) if Contractor requires authorization for the furnishing of a covered item or service enumerated in subsection (c) prior to the furnishing of, or payment for, such item or service to an enrolled child (including an adolescent).

(2) Items and Services Excluded from Prior Authorization — Contractor shall not require prior authorization for the furnishing of a covered item or service enumerated in subsection (d) and §104A (relating to self-referrals).

(3) Prescription Drugs — Contractor shall comply with the requirements in subsection (e) relating to the prior authorization procedures for prescription drugs.

^K(b) Prior Authorization Procedures⁸ — Contractor shall comply with the requirements of paragraphs (1) through (4) relating to prior authorization for covered items and services enumerated in subsection (c).

(1) Notification of Providers⁹ — Contractor shall notify in writing all providers participating in Contractor's provider network, as well as other providers that furnish items or services covered under Part 1 to enrolled children at Contractor's request, regarding:

(A) the items and services for which prior authorization must be obtained enumerated in subsection (c);

(B) the manner in which requests for prior authorization must be made;

(C) the information and documentation that must accompany a request for prior authorization;

(D) to whom the request for prior authorization must be given; and

(E) the identity of the individual responsible for communicating Contractor's determination regarding a request for prior authorization to the affected enrolled child.

(2) Availability of Forms — In a case in which Contractor requires prior authorization requests to be submitted on particular forms, Contractor shall ensure that all providers participating in Contractor's provider network have a sufficient quantity of such forms at all times.

(3) Toll-Free Number

(A) Establishment and Operation — Contractor shall establish and operate, on a [ ]-hour, [ ] day per week basis, a toll-free telephone number through which an enrolled child, the child's family or caregiver, or the child's treating provider may request prior authorization for an item or service enumerated in subsection (c).

(B) Staffing

(i) Sufficient Number — Contractor shall ensure that the toll-free telephone number described in subparagraph (A) shall be staffed at all times of operation by a number of individuals meeting the qualifications described in clause (ii) that is sufficient to ensure that the waiting times for callers seeking to request prior authorization does not exceed [ ] minutes.

(ii) Qualifications —Contractor shall ensure that the individuals receiving requests for prior authorization on the toll-free telephone number under subparagraph (A) are qualified by medical or related training, and authorized by Contractor, to approve requests by or on behalf of enrolled children for prior authorization.

(4) Standards for Timeliness — Contractor shall render a coverage determination:

(A) in the case of a request for prior authorization for items or services involving an enrolled child in foster care or other out-of-home placement (including a child with special health care needs in such circumstances), within [ ] days of receipt a request for prior authorization; and

(B) in all other cases, within [ ] days of receipt of a request for prior authorization unless within that time Contractor notifies the enrolled child or provider that additional information is required, but in no event later than [ ] days of receipt of a request.

^K(c) Items and Services Subject to Prior Authorization — [drafter insert list of covered items and services that require prior authorization].

^K(d) Items and Services Excluded from Prior Authorization — Contractor shall not require prior authorization for the following items and services:

^L(1) emergency services (as defined in §1401(l)) and post-stabilization care services (as defined in §1401(t) not subject to pre-approval under 42 C.F.R. §422.100(b)(1)(iv));

^K(2) urgent care (as defined in §1401(z));

^K(3) immunization services enumerated in §102 and Part 11;

^L(4) periodic EPSDT screens and interperiodic EPSDT screens enumerated in §102(b);

^L(5) family planning services and supplies enumerated in §§101 and 104;

^K(6) items and services related to diagnosis and treatment of a sexually transmitted disease enumerated in §106;

^K(7) items and services related to the diagnosis and treatment of tuberculosis enumerated in §108;

^K(8) items and services provided under an Individualized Education Program (IEP) (as defined in §1401(o)) or early intervention item or service in an Individualized Family Services Plan (IFSP) (as defined in §1401(p));

^K(9) a physical examination of an enrolled child upon entry into the [drafter insert reference to state's foster care system];

^K(10) items and services related to treatment for childhood lead poisoning enumerated in §102(b)(1)(D);

^K(11) items and services related to the prevention of HIV infection enumerated in §107;

^K(12) treatment services ordered with respect to an enrolled child by [drafter insert reference to state/local courts with jurisdiction];

^K(13) an examination to determine whether a child has been subject to physical or sexual abuse; and

^K(14) items and services related to the treatment of ongoing chronic condition that have been diagnosed by a pediatric specialist (as defined in §1401(s)) participating in Contractor's provider network.¹⁰

(e) Prior Authorization Procedures for Prescription Drugs — [RESERVED]

If, as a purchaser, you are interested in purchasing pediatric care for Medicaid-eligible children from managed care organizations on a risk basis, the following language on self-referrals is for your consideration.

^K§104A. Self-Referral for Certain Services without Prior Authorization — Contractor shall permit self-referral by an enrolled adolescent or a family or caregiver on behalf of any child to a provider participating in Contractor's provider network for the following services:

(a) consistent with §005(f):

(1) family planning services and supplies enumerated in §§101(g) and 104; and

(2) items and services related to diagnosis and treatment of a sexually transmitted disease enumerated in §106; and

(b) items and services relating to dental and oral health enumerated in §102(b)(3)¹¹.

If, as a purchaser, you are interested in purchasing pediatric care for Medicaid-eligible children from managed care organizations on a risk basis, the following language on coordination of benefits is for your consideration.

^K§105A. Coordination of Benefits

(a) Enrolled Children with Other Third Party Coverage — In the case of an enrolled child with third party coverage other than under [drafter insert name of purchasing document], Contractor shall, in making determinations regarding coverage of or payment for items and services enumerated in Part 1, administer [drafter insert name of purchasing document] in a manner consistent with the requirements of §1902(a)(25)(E) of the Social Security Act, 42 U.S.C. §1396a(a)(25)(E), 42 C.F.R. §433.139(b) (3)(i).

(1) Prenatal or Preventive Pediatric Services — In the case of a claim for prenatal care for a pregnant enrolled child or preventive pediatric services (including early and periodic screening, diagnostic and treatment services under §102), Contractor shall pay the full amount allowed under [drafter insert name of purchasing document or reference to state Medicaid plan, as appropriate] and seek reimbursement from any liable third party to the limit of legal liability.

(2) Items and Services Included in IEPs or IFSPs — Consistent with §1903(c) of the Social Security Act, 42 U.S.C. §1396b(c), in the case of an item or service covered under Part 1 and included in the IEP (as defined in §1401(o)) or the IFSP (as defined in §1401(p)) of an enrolled child, Contractor shall pay the full amount allowed under [drafter insert name of purchasing document or reference to state Medicaid plan, as appropriate] and seek reimbursement from any liable third party to the limit of legal liability.

(3) Other Covered Items or Services — In the case of a claim for an item or service not described in paragraph (1) or in paragraph (2), Contractor shall reject the claim and return it to the provider if Contractor or Purchaser has established the probable existence of third party liability.¹²

If, as a purchaser, you are interested in purchasing pediatric care for Medicaid-eligible children from managed care organizations on a risk basis, the following language on prior purchaser approval is for your consideration.

^K§106A. Prior Purchaser Approval

Prior to the first enrollment of an eligible child after the effective date of [drafter insert name of purchasing document], Contractor shall obtain the approval of Purchaser that Contractor's coverage determination standards and procedures and prior authorization requirements comply with the requirements of this Part.¹³

^KCompliance measure: Contractor shall make available to Purchaser all protocols, provider manuals, memoranda, and other materials used by Contractor to make coverage determinations or to instruct providers on coverage, coverage determination standards and procedures, and prior authorization procedures under [drafter insert name of purchasing document].

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Endnotes

1. Purchaser should note that if Contractor has imposed amount, duration, or scope limits that are more restrictive than those imposed under the federal regulations or the State's Medicaid plan referenced in paragraphs (1)-(4), the result could be that the state Medicaid agency would find itself liable for items or services that are not covered by the Contractor.
2. The purpose of this illustrative language is to ensure that Contractor's coverage determination standards are consistent with the literature on pediatric practice. For example, under �002(a)(2) of the Overview, at the option of the Purchaser, Contractor's duty would be to furnish covered items and services in a manner consistent with child health supervision guidelines such as Bright Futures, enumerated in �006(a)(1)(A). The illustrative language above would ensure that coverage determinations (to which the medical decisions of Contractor's providers are subject) are consistent with the Bright Futures guidelines that those providers follow in their practices.
3. An alternative option would be to delete all paragraphs but (1), (2), and (5). Another alternative option would be to delete paragraphs (6) and (7) while retaining paragraphs (1) through (5).
4. There is no federal regulatory definition of experimental under the Medicaid program. The standard used in this specification was articulated in Weaver v. Reagan (886 F2nd 194, 8th Circuit Court of Appeals, 1989). See also Miller v. Whitburn (10 F3rd 1315, 7th Circuit Court of Appeals, 1993) where an identical standard was applied in the case of a child needing a liver transplant and Rush v. Parham ( 625 F2nd 1150, 5th Circuit, 1980) which applied the same standards to determine when care was experimental under Medicaid.
5. An alternative option would be to delete all paragraphs but (1), (2), and (4). Another alternative option would be to delete all paragraphs but (1), (2), (3), and (8).
6. The EPSDT benefit includes developmental assessments under �1905(r)(1)(B)(i), the purpose of which is to detect evidence of delays or disabilities among Medicaid-eligible children. Under HCFA guidelines, for younger children the required developmental assessments must at a minimum include the following elements: (1) gross motor development; (2) fine motor development; (3) communication skills or language development; (4) self-help and self-care skills; (5) social-emotional development; and (6) cognitive skills, Medical Assistance Manual, �5123.2A.1.a. This illustrative definition of medical necessity is intended to clarify Contractor's obligation to treat and prevent not just developmental disabilities, but also developmental delays.
7. This illustrative language is intended to address items and services needed by enrolled children with chronic conditions, disabilities, or delays that cannot be prevented, corrected, or ameliorated.
8. An alternative option would be to require that if Contractor fails to comply with standards set forth in this subsection, the item or service for which prior authorization is sought shall be deemed to be covered.
9. One alternative option would be to delete all paragraphs but (1). Another alternative option would be to only delete paragraph (4) relating to standards for timeliness, thereby leaving the timing of such notice to Contractor's discretion.
10. One alternative option would be to delete all paragraphs other than (1) relating to emergency services. Another alternative option would be to focus on population-based public health services by deleting all paragraphs but (1), (3), (5), (6), (7), (10), and (11). Yet another alternative option would be to delete all paragraphs but (1), (8), (9), and (12), thereby exempting certain subpopulations of children (e.g., foster care children), from prior authorization.
11. An alternative option would be to delete all items and services other than family planning services enumerated under subsection (a)(1). Medicaid beneficiaries are entitled to freedom of choice of family planning provider, �1902(a)(23)(B), 42 U.S.C. �1396a(a)(23)(B).
12. In a May 21, 1999 Letter to State Medicaid Directors, HCFA reaffirms that "�Medicaid is the payer of first resort for medical services provided to children with disabilities pursuant to the Individuals with Disabilities Education Act," www.hcfa.gov/medicaid/smd52199.
13. An alternative option would be to add a requirement to this section requiring Purchaser to make such materials available to the public.