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How to File a Utilization Management Appeal

Individuals covered under a health benefits plan that uses one or more utilization management (UM) features, has the right to appeal a UM determination that results in a denial, termination or limitation of covered services. Or the covered person may give consent to a health care provider to pursue the UM appeal on the covered person's behalf. A UM determination is a decision made by the carrier about the medical necessity or appropriateness of a particular health care service covered under the terms of the health benefits plan. A UM determination may be made before or after a health care service is rendered, depending upon the terms of the policy.

A carrier that makes UM determinations must have a two-stage internal appeal mechanism. The carrier must provide covered individuals with a written explanation of how to access the internal appeal mechanism. This explanation may be in the member handbook or a certificate of coverage, or it may be in a separate document. In addition, the carrier must provide information to the covered individual, or the health care provider, when appropriate, about how to appeal unfavorable UM determination each time the carrier makes such an unfavorable UM determination.
Stage 1

For persons enrolled in group health plans, the first stage of appeal must be initiated within 180 days following the receipt of an unfavorable UM determination. Some carriers may specify a shorter timeframe for filing Stage 1 appeals when someone is covered under an individual policy or through Medicaid managed care plans. The first stage of appeal is informal, and generally fairly quick. Typically, a decision will be rendered within 10 calendar days from the receipt of the appeal.* If the covered individual or health care provider is not happy with the UM determination after the Stage 1 appeal, the covered individual or health care provider can take the appeal to the second stage.
Stage 2

The second stage of appeal must be initiated within 180 days following receipt of an unfavorable stage one decision. The second stage of appeal is more formal, and usually takes longer. A decision should be rendered for this stage of appeal within 20 business days from the date of receipt of the stage two appeal request.* The appeal will be reviewed by a panel of physicians and/or other health care professionals who have not been involved with the case earlier, but who are knowledgeable about the particular condition and services at issue. The panel, convened by the carrier, shall have access to health care professionals who are part of the carrier's network, or outside consultants in an appropriate specialty, or both. Some carriers offer the covered individual, or health care provider an opportunity to speak with the panel.

If the carrier's UM determination after the stage two appeal does not change, the carrier must give the covered individual (or health care provider, as appropriate) information about how to pursue the appeal externally, and supply the appropriate form (MS Word) (or Medicaid version) to file with the Independent Health Care Appeals Program (IHCAP).

Stage 3

Individuals, or health care providers acting with the individual's consent, who want to use the Independent Health Care Appeals Process (IHCAP), the third stage of appeal, must submit the appropriate form (MS Word) (or Medicaid version) to the Department within four months after receiving the carrier's written decision for the stage two appeal, along with the filing fee. The fee for filing with the Independent Health Care Appeal Program is $25, but the fee may be waived for individuals who can demonstrate eligibility for government assistance. The form and fee should be submitted to:
Office of Managed Care
Consumer Protection Services
Department of Banking and Insurance
PO Box 329
Trenton, NJ 08625-0329

If appropriate, the Department will forward the information to an Independent Utilization Review Organization (IURO), for review. The IURO has 45 calendar days from the date that it receives the appeal request to render a final decision.* Based on the information available to the IURO, it may uphold or reverse the carrier's decision, or it can modify the carrier's decision -- upholding it in part, and reversing it in part. The decision of the IURO is issued in writing, and provided to both the carrier and the covered individual. The decision of the IURO to reverse or modify a carrier's decision is binding upon the carrier and the covered individual, except to the extent that other remedies are available to either party under State or Federal law.

Please note that, on occasion, an individual may be permitted to by-pass a portion of the internal two-stage appeal process, and go directly to the external review. The request to by-pass the first and/or second stage of internal review must be based on the carrier's failure to meet the timeframes for the separate stages of appeal, the carrier's actual waiver of the requirement for the individual to pursue the first or second stage of appeal, or the covered individual and/or provider has applied for an expedited external review at the same time as applying for an expedited internal appeal.

*For emergency and urgent care cases, an admission, availability of care, continued stay and health care services for which the claimant received emergency services but has not been discharged from the facility, the carrier must make its decision on the appeal consistent with the urgency of the case, and in no instance more than 72 hours from the time the appeal is received at stage one, and at stage two. The Department will make every effort to have a decision by an IURO made within 48 hours of receipt of an emergency or urgent care appeal request for external review.

Before You Mail Your Appeal to the Independent Health Care Appeals Program:
  • Attach the filing fee of $25.00. Make the Check of Money Order payable to "New Jersey Department of Banking and Insurance." Send a check or money order only. DO NOT SEND CASH! (Note: The filing fee will be waived if you submit evidence of participation in one of the following: Pharmaceutical Assistance to the Aged and Disabled, Medicaid, NJ FamilyCare, General Assistance, SSI, or New Jersey Unemployment Assistance.)
  • Attach a copy of the Stage 1 and/or Stage 2 written decision from the carrier.
  • Attach a copy of the summary of coverage from your member handbook, certificate of coverage or other evidence of coverage issued by your carrier.
  • If a health care provider filing on behalf of a member, attach a copy of the member's consent to have an appeal of the adverse utilization management decision made on his or her behalf. Whenever possible, please use Consent to Representation in Appeals of Utilization Management Determinations and Authorization for Release of Medical Records in UM Appeals and Independent Arbitration of Claims.
  • Attach a copy of all medical records and correspondence to be reviewed by the Independent Health Care Appeals Program.

    Send only copies of any requested documents, because originals WILL NOT be returned.
OPRA is a state law that was enacted to give the public greater access to government records maintained by public agencies in New Jersey.
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New Jersey Department of Banking and Insurance