[§432E-1.4]  Medical necessity.  (a) 
For contractual purposes, a health intervention shall be covered if it is an
otherwise covered category of service, not specifically excluded, recommended
by the treating licensed health care provider, and determined by the health
plan's medical director to be medically necessary as defined in subsection
(b).  A health intervention may be medically indicated and not qualify as a
covered benefit or meet the definition of medical necessity.  A managed care
plan may choose to cover health interventions that do not meet the definition
of medical necessity.



(b)  A health intervention is medically
necessary if it is recommended by the treating physician or treating licensed
health care provider, is approved by the health plan's medical director or
physician designee, and is:



(1)  For the purpose of treating a medical condition;



(2)  The most appropriate delivery or level of
service, considering potential benefits and harms to the patient;



(3)  Known to be effective in improving health
outcomes; provided that:



(A)  Effectiveness is determined first by
scientific evidence;



(B)  If no scientific evidence exists, then by
professional standards of care; and



(C)  If no professional standards of care exist
or if they exist but are outdated or contradictory, then by expert opinion; and



(4)  Cost-effective for the medical condition being
treated compared to alternative health interventions, including no
intervention.  For purposes of this paragraph, cost-effective shall not
necessarily mean the lowest price.



(c)  When the treating licensed health care
provider and the health plan's medical director or physician designee do not
agree on whether a health intervention is medically necessary, a reviewing
body, whether internal to the plan or external, shall give consideration to,
but shall not be bound by, the recommendations of the treating licensed health
care provider and the health plan's medical director or physician designee.



(d)  For the purposes of this section:



"Cost-effective" means a health
intervention where the benefits and harms relative to the costs represent an
economically efficient use of resources for patients with the medical condition
being treated through the health intervention; provided that the characteristics
of the individual patient shall be determinative when applying this criterion
to an individual case.



"Effective" means a health
intervention that may reasonably be expected to produce the intended results
and to have expected benefits that outweigh potential harmful effects.



"Health intervention" means an item
or service delivered or undertaken primarily to treat a medical condition or to
maintain or restore functional ability.  A health intervention is defined not
only by the intervention itself, but also by the medical condition and patient
indications for which it is being applied.  New interventions for which
clinical trials have not been conducted and effectiveness has not been
scientifically established shall be evaluated on the basis of professional standards
of care or expert opinion.  For existing interventions, scientific evidence
shall be considered first and to the greatest extent possible, shall be the
basis for determinations of medical necessity.  If no scientific evidence is
available, professional standards of care shall be considered.  If professional
standards of care do not exist or are outdated or contradictory, decisions
about existing interventions shall be based on expert opinion.  Giving priority
to scientific evidence shall not mean that coverage of existing interventions
shall be denied in the absence of conclusive scientific evidence.  Existing
interventions may meet the definition of medical necessity in the absence of
scientific evidence if there is a strong conviction of effectiveness and
benefit expressed through up-to-date and consistent professional standards of
care, or in the absence of such standards, convincing expert opinion.



"Health outcomes" mean outcomes that
affect health status as measured by the length or quality of a patient's life,
primarily as perceived by the patient.



"Medical condition" means a disease,
illness, injury, genetic or congenital defect, pregnancy, or a biological or
psychological condition that lies outside the range of normal, age-appropriate
human variation.



"Physician designee" means a
physician or other health care practitioner designated to assist in the
decisionmaking process who has training and credentials at least equal to the
treating licensed health care provider.



"Scientific evidence" means
controlled clinical trials that either directly or indirectly demonstrate the
effect of the intervention on health outcomes.  If controlled clinical trials
are not available, observational studies that demonstrate a causal relationship
between the intervention and the health outcomes may be used.  Partially
controlled observational studies and uncontrolled clinical series may be
suggestive, but do not by themselves demonstrate a causal relationship unless
the magnitude of the effect observed exceeds anything that could be explained
either by the natural history of the medical condition or potential
experimental biases.  Scientific evidence may be found in the following and
similar sources:



(1)  Peer-reviewed scientific studies published in or
accepted for publication by medical journals that meet nationally recognized
requirements for scientific manuscripts and that submit most of their published
articles for review by experts who are not part of the editorial staff;



(2)  Peer-reviewed literature, biomedical compendia,
and other medical literature that meet the criteria of the National
[Institutes] of Health's National Library of Medicine for indexing in Index
Medicus, Excerpta Medicus (EMBASE), Medline, and MEDLARS database Health
Services Technology Assessment Research (HSTAR);



(3)  Medical journals recognized by the Secretary of
Health and Human Services under section 1861(t)(2) of the Social Security Act,
as amended;



(4)  Standard reference compendia including the
American Hospital Formulary Service-Drug Information, American Medical
Association Drug Evaluation, American Dental Association Accepted Dental
Therapeutics, and United States Pharmacopoeia-Drug Information;



(5)  Findings, studies, or research conducted by or
under the auspices of federal agencies and nationally recognized federal
research institutes including but not limited to the Federal Agency for Health
Care Policy and Research, National Institutes [of] Health, National Cancer
Institute, National Academy of Sciences, Health Care Financing Administration,
Congressional Office of Technology Assessment, and any national board
recognized by the National Institutes of Health for the purpose of evaluating
the medical value of health services; and



(6)  Peer-reviewed abstracts accepted for presentation
at major medical association meetings.



"Treat" means to prevent, diagnose,
detect, provide medical care, or palliate.



"Treating licensed health care
provider" means a licensed health care provider who has personally
evaluated the patient. [L 2000, c 250, §8]