IROs Offer Another Chance to Overturn Insurers' Coverage Denials

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The Obstacle Course — September 2017

Tex Med. 2017;113(9):27-31

By Joey Berlin
Associate Editor

Throughout his medical career, Eyal Muscal, MD, has gone through plenty of rounds with insurers, navigating their internal appeals processes to get medications covered for his patients.

"I would say every day, my nurses, partners, and I are fighting for certain medications that we think of as standard-of-care in some way," the Houston pediatric rheumatologist at Texas Children's Hospital said.

But Dr. Muscal didn't know there was another route he could take when those appeals were exhausted ― one in which another physician, not affiliated with the insurer, could weigh in on whether a treatment was necessary.

"I did not know about this, and I'd been practicing for over 10 years. And for that matter, our pre-cert people really weren't aware of the process, either," he said.

Independent review organizations, or IROs, allow physicians to argue that a procedure is medically necessary and should be covered, giving patients with Texas Department of Insurance (TDI)-regulated plans another level of appeal. But 20 years they were first allowed in Texas, quite a few physicians still don't know they exist. 

Submitting a treatment coverage decision for independent review requires extra work from a treating physician and the patient's family, but it gives them a fighting chance to get a procedure covered without the drastic step of litigation. The Texas Medical Association's general counsel provided Dr. Muscal with the information on IROs.

Dr. Muscal says Texas Children's has a "very educated and professional infusion pre-cert team," and if it didn't know about how to pursue an independent review, he doubts that many pediatric offices or hospitals in the state do.

How IROs Work

The Texas Legislature established the state's IRO system, with TMA's strong support, in 1997. The implementation of the Affordable Care Act in 2010 made independent review systems a requirement for every state, says Aja Ogzewalla, president of the National Association of Independent Review Organizations (NAIRO).

"Some states did have their own processes prior to that, but [ACA] really brought the opportunity for an IRO, for an external review," she said. "It brought much more attention to it and helps raise awareness of that process. However, we are still seeing that there are a lot of providers, advocacy groups, [and] patients who still are not aware of that process."

Health plans that deny coverage for a procedure typically offer two levels of appeal, starting with a case review by a physician working for the insurer. If the coverage is still denied after going through all of the health plans' appeals processes, an independent review is the next route eligible patients can take.

Even then, an independent review can be requested only in cases in which the treatment was denied as being experimental, investigational, inappropriate, or not medically necessary. 

A patient's health plan must be TDI-regulated in order for medical care to be eligible for an independent review, the insurance department says on its IRO website. You'll know if your patient's plan is TDI-regulated if the letters "TDI" or "DOI" are printed on the front of the patient's ID card.

"I've been starting to look at insurance cards to see if they have the appropriate language on it … to see whether it's a plan that has that type of regulatory oversight," Dr. Muscal said.

A patient can bypass an appeal and go straight to an independent review if the condition is deemed life-threatening or if the health plan denies a claim for prescription drugs or intravenous infusions for which the patient is already receiving benefits, according to TDI. (See "The IRO Path.")

Patients requesting an independent review must file a formal request to the insurance carrier, which forwards the request to the insurance department for assignment to an IRO. The IRO will have 20 days to make a decision for nonlife-threatening preauthorization cases and three days for life-threatening cases. IROs also can look at retrospective necessity cases and are allowed 20 days to complete those.

If an IRO doesn't overturn an insurer's decision, the patient can take the case to district court. The health plan doesn't have that option if the IRO rules against it; insurers are statutorily obligated to follow an IRO's decision.

TDI operates the IRO system somewhat differently for workers' compensation cases. For example, IROs have eight days, rather than three, to evaluate a preauthorization case for a life-threatening condition.

For more information on Texas' IRO system, visit TDI's IRO page.  

The insurer or its utilization review agent must pay the cost for an independent review. In Texas, reviews performed by a doctor of medicine or osteopathy cost $650. Reviews performed by other practitioners cost $460.

"There tends to be a perception that IROs have a conflict of interest because the health plan is the one paying for the external review, which is not the case," Ms. Ogzewalla said. "We have to follow very strict conflict-of-interest guidelines, which the states mandate, and so does the Affordable Care Act. Somebody has to pay for the review, which is why the health plans are paying us."

Texas is currently operating under a waiver from the Centers for Medicare & Medicaid Services (CMS) that allows health plans to follow the state's external review process. If that waiver expires as scheduled on Jan. 1, 2018, state-regulated independent reviews would then operate under a federal external review process administered by the U.S. Department of Health and Human Services. However, TDI is working with CMS to extend that waiver so Texas can continue using the state standards, Jerry Hagins of TDI media relations said in an email. Texas' external review process is more consumer-friendly than the federal version, Mr. Hagins says. 

Gauging IROs' Success

Although a health plan usually prevails in an independent review, the process gives the patient a fighting chance. From 2014 to 2016, more than 30 percent of each year's independently reviewed cases resulted in a complete or partial turnover. (See "IRO Success Rates.")

During the first six years following the legislature's approval of IROs, patients and their physicians won 51 percent of independent reviews and earned partial reversal of insurers' decisions in another 8 percent of cases, according to a Texas Medicine story in March 2003. Since then, those percentages have decreased significantly. But that's not a sign that the tide in IROs has turned in favor of insurers, TMA general counsel Rocky Wilcox says.

"What that tells you is that insurance companies are being a little more careful about their denials," Mr. Wilcox said. 

But Ed Bolton, vice president of NAIRO, says the decrease in upheld denials is more a function of practitioners adjusting their awareness.

"I don't think it's more about the IRO. In my opinion, I think the providers are more aware," Mr. Bolton said. "As these new students are graduating from medical school and going through residency, they are more closely following practice guidelines, which then tends to bring down that percentage over time."

An IRO Victory

Dr. Muscal's awakening to IROs came after a review overturned denial of a relatively new treatment for a teenager diagnosed with pediatric acute-onset neuropsychiatric syndrome (PANS). 

The syndrome is "likely related" to, but not the same as, the more well-known pediatric autoimmune neuropsychiatric disorders associated with streptococcal infections (PANDAS), according to the PANDAS Network, an organization dedicated to improving the treatment of children with those disorders. PANS triggers "a misdirected immune response [that] results in inflammation on a child's brain," the PANDAS Network says. That causes an affected child to exhibit "symptoms such as OCD [obsessive compulsive disorder], severe restrictive eating, anxiety, tics," and personality changes, among others. First named in a 2012 research article, PANS does not yet have an evidence-based treatment plan from the National Institute of Mental Health (NIMH), but the institute and clinical researchers have developed standard-of-care guidelines for the disorder.

The teen's insurer initially denied coverage for intravenous gamma globulin (IVIg) therapy, an immune system-modulating procedure that NIMH recommends as part of those treatment guidelines. 

The insurer's denial notice said the teen's plan did not cover "unproven procedures." To be considered proven, the notice said, a procedure "must be recognized as effective or to have a beneficial effect on the diagnosis or treatment of a specified condition according to clinical evidence published in peer-reviewed medical literature."

Dr. Muscal acknowledged that "there isn't really one agreed-upon standard of care, and a lot of medical professionals, depending on where they trained and how they trained, don't believe that the scientific literature or the evidence has been robust regarding diagnosis and therapy."

Within the past year, Dr. Muscal says, insurers have become more restrictive on the use of IVIg for PANS because of one small trial that didn't show any benefit with a one-dose treatment of IVIg for children with PANDAS.

"The insurance companies have chosen not to take into account years of observational studies and expert opinion panels," he said.

Dr. Muscal and Robert Van Boven, MD, one of the other physicians who made the diagnosis, wrote appeal letters to the health plan. In his letter, Dr. Muscal said IVIg treatment for a PANS case like this usually lasts three to six months. 

For the appeal, Dr. Muscal says he initially talked to a thoughtful medical director who asked for more documents. That led to a peer-to-peer call with a second doctor who "didn't care about any of the documentation I sent. They just cared about one specific research paper that was recently published about this medication."

After the appeal process went nowhere, the teen's case went to an IRO, which looked at a large packet with essentially the same information that Dr. Muscal and Dr. Van Boven provided to the health plan. The IRO's review concluded the IVIg treatment was necessary and appropriate, saying that based on the patient's "neuro-immunologic abnormalities and the unremitting nature of his illness, he would qualify under the current guidelines for monthly dosing of IVIg until he is no longer having a period of improvement."

Education Needed

While it can lead to a beneficial result, preparing materials for a patient's appeal to an IRO can be a hassle. Ghassan Salman, MD, chair of the TMA Council on Health Care Quality and chief executive officer of Austin Diagnostic Clinic, says many physicians at the clinic are wary of medical-necessity appeals and independent reviews. While independent reviews are "a solution" to issues with insurer denials, he says, "I don't think it is the solution."

"Most of the complaints that I get from physicians [are]: 'I work long hours, and when I do this process, I have to stop everything and get on the phone, and most of the time it's not helpful,'" he said.

Mr. Wilcox, the TMA counsel, says preparing IRO documentation "does require some work."

"The doctor's going to, in addition to providing the medical records, provide some rationale about why he or she thinks the services are needed, including … some citations to peer-reviewed literature that show that it's useful. There's no compensation for that, but it is part of what we need to do to advocate for patients," he said.

The TMA Knowledge Center can help physicians round up relevant clinical materials for an independent review. It offers online access to journals and textbooks, and research services from TMA's medical librarian

Knowledge is one thing Dr. Muscal thinks physicians need more of, particularly after seeing Texas Children's staff learn about the IRO process on the fly. 

"I think there probably is some outreach that needs to happen regarding the IRO process, either through social media or other materials for physicians who take care of kids with rare diseases, or who write for complex and often expensive medications," he said.

Joey Berlin can be reached by phone at (800) 880-1300, ext. 1393, or (512) 370-1393; by fax at (512) 370-1629; or by email.

Last Updated On

September 05, 2017

Originally Published On

August 22, 2017