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

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

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

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

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

(A)  Effectiveness is determined first byscientific evidence;

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

(C)  If no professional standards of care existor if they exist but are outdated or contradictory, then by expert opinion; and

(4)  Cost-effective for the medical condition beingtreated compared to alternative health interventions, including nointervention.  For purposes of this paragraph, cost-effective shall notnecessarily mean the lowest price.

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

(d)  For the purposes of this section:

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

"Effective" means a healthintervention that may reasonably be expected to produce the intended resultsand to have expected benefits that outweigh potential harmful effects.

"Health intervention" means an itemor service delivered or undertaken primarily to treat a medical condition or tomaintain or restore functional ability.  A health intervention is defined notonly by the intervention itself, but also by the medical condition and patientindications for which it is being applied.  New interventions for whichclinical trials have not been conducted and effectiveness has not beenscientifically established shall be evaluated on the basis of professional standardsof care or expert opinion.  For existing interventions, scientific evidenceshall be considered first and to the greatest extent possible, shall be thebasis for determinations of medical necessity.  If no scientific evidence isavailable, professional standards of care shall be considered.  If professionalstandards of care do not exist or are outdated or contradictory, decisionsabout existing interventions shall be based on expert opinion.  Giving priorityto scientific evidence shall not mean that coverage of existing interventionsshall be denied in the absence of conclusive scientific evidence.  Existinginterventions may meet the definition of medical necessity in the absence ofscientific evidence if there is a strong conviction of effectiveness andbenefit expressed through up-to-date and consistent professional standards ofcare, or in the absence of such standards, convincing expert opinion.

"Health outcomes" mean outcomes thataffect 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 orpsychological condition that lies outside the range of normal, age-appropriatehuman variation.

"Physician designee" means aphysician or other health care practitioner designated to assist in thedecisionmaking process who has training and credentials at least equal to thetreating licensed health care provider.

"Scientific evidence" meanscontrolled clinical trials that either directly or indirectly demonstrate theeffect of the intervention on health outcomes.  If controlled clinical trialsare not available, observational studies that demonstrate a causal relationshipbetween the intervention and the health outcomes may be used.  Partiallycontrolled observational studies and uncontrolled clinical series may besuggestive, but do not by themselves demonstrate a causal relationship unlessthe magnitude of the effect observed exceeds anything that could be explainedeither by the natural history of the medical condition or potentialexperimental biases.  Scientific evidence may be found in the following andsimilar sources:

(1)  Peer-reviewed scientific studies published in oraccepted for publication by medical journals that meet nationally recognizedrequirements for scientific manuscripts and that submit most of their publishedarticles 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 IndexMedicus, Excerpta Medicus (EMBASE), Medline, and MEDLARS database HealthServices Technology Assessment Research (HSTAR);

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

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

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

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

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

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