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FAQFrequently Asked Questions General Questions
Utilization Review Questions
Medical Review Questions
Hospital Peer Review Questions
Miscellaneous
AnswersWhat is an IRO?An IRO, or independent review organization, provides independent medical reviews that help health insurance payers make consistent, evidence-based healthcare decisions regarding benefits coverage. An IRO is a healthcare advocate for both the patient and the payer, by ensuring coverage for medically necessary treatments, while eliminating overutilization. As an intermediary, an IRO provides a ready-made source of timely, expert medical determinations that weighs both the medical and insurance side of healthcare information by providing access to objective expert medical expertise not readily available to payers. For the payer, an IRO monitors the group plan to assure that enrollees aren’t spending money on care that is not needed, is not medically necessary or doesn’t fit the accepted standard of care. For every enrollee in a healthcare group plan, an IRO ensures that each one receives the level of care required by the plan, while trying to manage cost of the plan to patients. What other names have been used for IROs? Over the years, many names have been used to describe IROs. The more commonly-used ones have included: Medical Necessity Review Organization (MNRO), External Review Organization (ERO), Peer Review Organization (PRO), Medical Review Company, and others. Today, the industry has settled on IRO as the generally-accepted name, although from time to time you will find other names used. Why did IROs get started? About a decade ago, state governments across the country noted that financial incentives were motivating some healthcare organizations more than providing quality healthcare. Many people in decision-making positions interfered with the delivery of medical coverage, including the pharmaceutical industry, physicians, medical insurers and other interest groups. What’s the purpose of an IRO? When their healthcare insurer denies a claim, IROs provide patients with a response system for getting the care they need and in many cases have paid for. IROs make unbiased decisions about medical care based solely on evidence and the medical necessity of a procedure. What’s the cost of using an IRO? The cost can vary, but it’s an economical way for healthcare insurers to make sure their subscribers are getting the care they pay for — especially when it’s evaluated for return-on-investment. Simple cases for payers can be reviewed for less $100; many medical reviews cost $300; and highly complex disability or quality of care cases for hospitals can run much more. The price of reviews varies according to the number of pages of case notes, the number of questions to be answered, the complexity of the case, the required turnaround time for the response, and other factors. Why would a healthcare insurance payer want to use an IRO? To comply with state insurance regulations, the federal Employee Retirement Income Security Act (ERISA) and U.S. Department of Labor regulations, as well as mandated deadlines. Many payers outsource their medical reviews to IROs because they can not efficiently and cost-effectively manage the extensive infrastructure needed in-house. Also, many payers are for-profit organizations and don’t want to be perceived as denying treatment to cut costs. Turning to an IRO to review special cases can provide them with information to make better decisions. When we provide AllMed sensitive information about patients or physicians, how do you protect confidentiality? Like all IROs, AllMed handles your information according to Health Insurance Portability and Accountability Act standards and meets all of the federal law’s requirements. AllMed maintains strict confidentiality to ensure the privacy of all medical records, health benefits information and plan documents provided for external review. What kind of reviews do IROs conduct? IROs can conduct many kinds of independent medical review — hospital peer review, utilization, disability, fraud, pre-authorization, retrospective claims decisions, length-of-stay, quality management, inter-rater reliability, as well as other reviews. What kind of reviews does AllMed conduct? AllMed conducts hospital peer review, specialty-matches for utilization review, disability review, fraud, pre-authorization, retrospective claims reviews, concurrent review, quality management and inter-rater reliability reviews. In addition, we offer medical director services. What kinds of organizations do IROs serve? They provide medical decision-making support to insurance carriers that provide health, disability, workers comp, property, casualty and life insurance. They also provide the same services to medical management firms, case management firms, utilization management companies, utilization management firms, third-party administrators (TPAs), managed care organizations, hospitals, medical groups, self-insured organizations, HMOs, unions, trusts and re-insurers. How many different physician specialists does an IRO have? Usually, IROs can cover several hundred medical specialties and sub-specialties, and if they don’t have the one you need, they can quickly recruit and qualify the right specialist to meet your needs. All specialists are board-certified, in active practice and have been credentialed by the IRO. Currently, AllMed has approximately 400 board-certified physicians on its peer specialist panel. What specialties do IRO physicians cover? You name it. IROs cover major and minor specialties from cardiology to urology. In addition, they often have experts in vocational therapy, chiropractic and even acupuncture. What if an IRO doesn’t have the specialists we need? Usually, IROs can cover any medical specialties called for. If they don’t have the one you need, they can quickly recruit and qualify someone to meet your needs. Which states have external review policies? As of December 2004, 43 states plus the District of Columbia have legislated external review procedures whereby individuals can file for an appeal, usually through the state insurance commissioner’s office. However, this is typically the last resort for an individual who has been denied benefit coverage. Many leading insurance payers have adopted the use of IROs for their own internal reviews and appeals as a best practice. Doing so raises the level of objectivity and provides members with increased confidence in the integrity of their health plan’s coverage decisions. What laws and regulations govern an IRO? While some states have enacted regulations that impact independent medical review such as managed care regulations, for the most part, IROs themselves are not highly regulated. Physician licensure laws at both the state and federal levels provide a strong framework for ensuring the quality of an IRO’s determinations. However, to ensure the quality and uniformity of their services, the leading IROs have sought accreditation by URAC, a nonprofit group that audits and accredits quality measures in health-care organizations. Some states are now requiring IROs to have URAC accreditation in order to perform independent review in their states. What organizations accredit IROs? URAC (urac.org) accredits IROs. URAC (formerly know as the Utilization Review Accreditation Commission) is a nonprofit organization promoting healthcare quality by accrediting healthcare organizations. URAC certifies independent review organizations and other companies involved in healthcare utilization review for two years. They must periodically recertify. Because of its status as an accreditation organization, many state and some federal government agencies turn to URAC as the basis for consumer protection and sometimes refer to these standards. What kinds of certifications do IROs have? While IROs do not have to be accredited by URAC in order to operate, they usually have to be certified by the state insurance commissions for which they perform external reviews. Many states turn to the recommendations of URAC or NAIRO to create their policies. Working with a URAC-certified IRO ensures that the company was reviewed within the last five years and will provide a higher quality review. Don’t IROs just add to the cost of our healthcare system? While it does cost something to use IROs, the cost is minimal. IROs actually reduce the overall cost of health care because they look at every case objectively, based on the most current medical evidence, suggest alternative − often less expensive − treatments, and weed out unnecessary or even fraudulent procedures. One IRO found that for every $1 spent with an IRO on a case, its customers saved $16 overall. How do IROs improve the national healthcare system? IROs protect the integrity of health care by helping ensure that patients and members of health insurance plans receive the benefits coverage they deserve according to the latest standards of care. They also help reduce the cost of healthcare by reducing the number of unnecessary treatments, often called “over-utilization.” At AllMed, we’re passionate about improving healthcare quality, costs and patient safety and believe that the work we are doing is making a real difference. Can I talk to an IRO’s physician specialists? That depends on the IRO. Some will let the party paying for the review ask questions about the review, others are less willing to provide that access. If you have a question about an AllMed review, we encourage you to speak with one of our doctors to clear up any questions. We provide a free MedConsult hotline to our clients and encourage them to speak with our in-house staff of physicians. What if I have questions about a review an IRO has done? At AllMed when you have a question about one of our reviews, we encourage you to speak with one of our doctors to clear up any questions. If legal action occurs as the result of an IRO review, will the IRO appear in court with me? If it looks like a particular case is going to be litigated, it’s best to inform your IRO upfront, so they can find a specialist who is potentially willing to testify as an expert witness. Practically speaking, this rarely happens. When it does, AllMed’s medical team in many cases is willing to provide exert witness services. What medical information does an IRO base its reviews on? Clinical specialists working with IROs are up-to-date on the most current medical literature and research studies in their fields, as well as published care management guidelines. They consider these when analyzing a case. Because they do not know the patient or the doctor, they are in a position to make an unbiased decision solely based on the medical facts of the case. How do you handle reviews involving alternative medicine? IROs also work with alternative medicine clinicians who review cases and determine the medical necessity and acceptable duration of alternative treatments. What is an evidence-based review? An evidence-based review relies on the practice of evidence-based medicine. That is, the treatment recommended must have its origin in objective tests of efficacy published in the scientific literature and not based on anecdotal observation. Do IROs stand behind their reviews? Because IROs use evidence-based approaches, their reviews are objective and unbiased, which makes it easy to support reviews with existing medical literature. What kinds of organizations rely on IROs for reviews? A variety of healthcare organizations rely on IROs for reviews, including medical management firms, third-party administrators (TPAs), managed care organizations, hospitals, medical groups, self-insured organizations, HMOs, unions, trusts and reinsurers. Today, IROs have become an integral part of the healthcare benefits determination process.
Utilization Review QuestionsWhat is utilization management?Utilization management (UM) is the process of evaluating the appropriateness, medical need and efficiency of healthcare services. Usually UM includes and new activity or decisions based upon the analysis of a case. UM describes proactive procedures. These include pre-certification, discharge planning, concurrent planning or clinical case appeals. It also looks at proactive processes, including concurrent clinical reviews and peer reviews, as well as appeals introduced by the provider, payer or patient. What is a utilization review? The utilization review is a cost-control program used by managed-care plans to reduce any unnecessary medical services. On behalf of an insurer, either an individual or an organization reviews the need, use, appropriateness, efficacy or efficiency of healthcare services, procedures, providers, facilities or quality of service. For example, a hospital review may include pre-admission certification, concurrent review with discharge or planning and a retrospective review of the case. Do IROs conduct utilization reviews? Some IROs offer both utilization review and independent medical review services. However, most IROs provide specialty medical review services to utilization review entities, which bundle it into their UR offerings. AllMed does not provide utilization review services directly to health plans or subscribers; however, it works with many top utilization review and medical management firms nationwide, providing the specialist “engine” that makes UR decisions on organ transplants, oncology treatments and other complex medical issues. What is the difference between independent medical review and utilization review? A utilization review is conducted on behalf of a health plan insurer. Either an individual or an organization reviews the need, use, appropriateness, efficacy or efficiency of healthcare services, procedures, providers, facilities or quality of service. A medical-necessity review looks at the appropriateness of a specific medical procedure, and may be part of a utilization review. Utilization review is normally conducted by nurses, and independent medical review is always conducted by doctors.
Medical Review QuestionsWhat is a medical-necessity review?A medical-necessity review is a review to determine if a treatment is necessary from a medical perspective and that it fits the current standard of care. What is a pre-authorization-of-treatment review? Many health insurers require enrollees to have specific treatments approved before the treatment can begin. Failing to gain pre-approval for a treatment may mean the health insurer will not cover that treatment, even if it’s medically necessary. This is also called utilization review. What is a retrospective claims review? A retrospective claims review evaluates the necessity of healthcare services that have already been delivered to the patient. Do you review cases that are appealed or reconsidered? Yes, AllMed provides reviews of patient appeals to hundreds of healthcare payers nationwide. Many health plans and payers who follow best practices automatically send all appeals out to an IRO. This helps them to show their members that each claim is being reviewed with the highest degree of objectivity. It also helps them to stay in compliance with state and federal regulations. Health plans that still process appeals internally with their own clinicians run a higher risk of lawsuits and risk the perception of conflict of interest. What is the turn around time for a medical-necessity review? Most IROs turn reviews around in a week or 10 days. AllMed’s goal is three working days for non-expedited reviews, depending on the complexity of the case and the externally imposed deadlines required by the Department of Labor, the Employee Retirement Income Security Act of 1974 (ERISA) or mandated state deadlines. For clients that need responses the same or next day, we offer expedited review services too. When should a medical-necessity review be done? A medical-necessity review is needed whenever doubt exists about whether or not a specific procedure is needed, or whether it meets the accepted standard of care. National statistics show that 30 percent of all medical treatments are unnecessary. This affects the cost and quality of healthcare for everyone, and so it’s in everyone’s interest to make sure that over-utilization is reduced or eliminated. What type of information do I need to submit for a medical-necessity review? Along with the patient’s case file, you should submit any supporting images, physician recommendations, physician notes and questions you want answered. Do you have guidelines for external medical-necessity reviews? Health insurers, TPAs and payers should consider an external review if they believe the treatment is experimental or investigational; when the treatment is controversial; or when the treatment is not yet considered the standard-of-care. Who are some of your clients for medical-necessity reviews? AllMed’s clients for medical necessity reviews include Educators Mutual Life Insurance, HealthGuard of Lancaster, Inc., Insurance Management Services Managed Care, Capital BlueCross, American Health Holding, Q-elements and Bay Area Hospital, among others. What are best practices for medical-necessity reviews? Key points in medical necessity reviews should include the following: an evidence-based decision; meeting all state and federally mandated deadlines; providing a review without a conflict of interest; and the ability to ask questions of the IRO providing the review after it’s conducted. When is conflict of interest an issue in medical necessity reviews? Usually, the conflict of interest concern is: 1) economic, 2) not having a like specialist review the case, or 3) having the same doctor review an appealed case who denied it. Healthcare plans that routinely reject cases in a particular area may be seen as avoiding payments. Because the standard of care is a shifting line, only a specialist knows where that line is. Health plans using the same doctor to review appealed cases might be suspect of the conflict of interest in 1 and 2 above. When should I be concerned about conflict of interest in medical-necessity reviews? If your decisions are based on cost-cutting or other economic reasons, if you do not have an on-staff specialist to review the case and if your organization uses the same doctor who denied cases to review the appeals. Why should a specialist conduct a medical-necessity review? The standard of care is changing all the time. There’s so much change that only specialists can keep up with it. So, because the standard of care is a shifting line, only a specialist knows where that line is. Can an IRO decide if a medical treatment is experimental or investigational? Yes. The physician specialists who work with IROs are tracking the latest medical research literature and know when treatments move from the experimental or investigational stage to the standard of care. What is the difference between an independent medical review and hospital peer review? The term “peer review” can be confusing. Sometimes “peer review” is used in both types of review, because a doctor’s “peer” can review a case that’s being appealed. An independent medical review, however, is normally used by healthcare payers. It looks at whether or not a specific procedure was medically necessary. A hospital peer review is performed on a practitioner’s work in a provider organization.
Hospital Peer Review QuestionsWhat is a hospital peer review?Hospital peer review refers to the review of a case or group of cases to determine if a doctor’s work meets the standard of care. Today, many hospitals use IROs to review the work of their practitioners, to verify their credentials and to make decisions on privileging. Once, hospitals used external peer review only for sentinel events as a quality control effort. In 2007, the Joint Commission (formerly JACHO) broke peer review into “focused” and “on-going” evaluations of physicians to improve the overall quality of care within hospitals. Many hospitals are increasingly turning to IROs to perform quality of care reviews, as well as for the credentialing and re-credentialing of their practitioners. As a result, IROs are becoming involved in systematic, proactive peer review as an ongoing part of many hospitals’ performance improvement and quality management efforts. What type of information do I need to submit for a hospital peer review? This can vary depending on the type of peer review — on-going or focused. In general, we will need all the documentation about the doctor, the reason for the review, along with questions you have about the review. In the case of a sentinel event, we’d also like to images (x-rays, MRIs or photos) and know everything about what lead up to the event. What is the turnaround time on a hospital peer review? It can depend on the complexity of the case and the type of review— on-going or focused. AllMed’s turnaround time runs one week to 10 working days. What is the difference between internal and external peer review? When in-house staff performs peer review, it’s called “internal peer review.” In external peer review, an unbiased third-party conducts the peer review. Internal reviews often involve individuals who have conflicts of interest, which weakens the organization’s ability to defend the review if it were to go to court. Why can’t a hospital have its staff physicians conduct peer reviews? Peer-review committees that rely solely on in-house personnel often lack the specialist expertise, objectivity and resources to assess their physician staff effectively. Tight-knit social and professional relationships may lead to conflicts of interest and reluctance to pass judgment on associates. Moreover, hospital peer review is not a high priority in the busy schedule of medical staff, which means evaluations are not completed in a timely manner. What considerations prompt hospitals to arrange for an external peer review? Conditions that can prompt hospital peer review include sentinel events, credentialing or re-credentialing, a new physician hire, a random selection of hospital cases, privileging or re-privileging a physician. When should I consider using a hospital peer review? Consider external review to help fulfill the Joint Commission’s requirement for focused and ongoing physician evaluations. Consider peer review whenever you have a sentinel event, need to credential or re-credential a doctor, hire a new physician, need to privilege re-privilege a physician. Do you have guidelines for when and how external peer review should be used by hospitals? Yes. You can read these in our Peer Review Guide available at www.allmedmd.com/resources/downloads/2007_JCAHO_guide.htm. Will an IRO conduct an on-site peer review? Not normally. Most peer reviews can be done more effectively if no personal contact takes place between the reviewers and the physicians who are being reviewed. In certain cases where systemic, equipment or training issues come into play, AllMed personnel will go onsite. Who are some of your clients for peer review? AllMed performs external peer review for many of the nation’s leading hospital chains and groups. Those include non-profit and for-profit hospitals, medical centers and Ambulatory Surgery Centers (ASCs) both large and small, in both urban and rural locations. What organizations govern or certify hospital peer review? There is no organization that provides oversight to IROs in the area of hospital peer review. Hospital peer review is mandated by the Joint Commission and other hospital accreditation bodies to varying degrees; however, the work of IROs in this area is not regulated or accredited to any high degree. What are best practices for hospital peer review? The primary best practice is to develop a hospital culture that supports peer review by using it as an educational tool, not as a disciplinary tool. For more details on this subject, read our “Best Practices in Peer Review” guide available at www.allmedmd.com/resources/downloads/wp_bppr.htm. Why can’t we have a teaching university do our peer reviews? While that may be worth considering, conflict of interest might be inherent in that choice. If the teaching university is getting support or funding from a hospital, it might not be able to be unbiased. If it’s local to the hospital, then personal relationships could enter the picture as a conflict-of-interest consideration. Often times, academically oriented hospitals are long on credentials and short on practical experience. Finally, more often than not, they don’t have the time. Why should I be concerned about conflict of interest in a peer review? Conflict of interest ruins peer review because it creates a situation where decisions can be made based on economics and friendships rather than on the evidence of a doctor’s competence. There are many conflict of interest situations that should trigger the use of external peer review in order to objectively evaluate the performance of practitioners. For more information, download our peer review guide at www.allmedmd.com/resources/downloads/wp_bppr.htm. If peer review results initiate a lawsuit, does an IRO stand behind its review of the physician? Yes, and you can use an IRO medical specialist as an expert witness. However, you should inform us at the time that you are requesting the review, so that we can anticipate the need for expert witness testimony at the time we select the peer specialty reviewer.
MiscellaneousWhat is a disability review?AllMed and other IROs perform disability review determinations for many of the nation’s leading disability insurance carriers. A disability review is a determination of whether a member’s medical condition constitutes a short- or long-term disability and should therefore be covered by the carrier. What is a fraud review? A fraud review looks at the process to find irregular, misleading or illegal activity in healthcare cases. IROs may review many types of medical fraud. Here are just a few:
What is a medical director service? It is a customized program to provide interim or regular medical-director support to insurance companies, payers and medical management firms. They might consider this solution because they either can’t afford a full-time director or don’t know where to find someone with the right experience. What categories of decisions do IROs offer? Most IROs offer the following categories of decisions: medical necessity, standard-of-care, experimental or investigational, usual and customary (UCR), plan interpretation, fraud, over-utilization, code unbundling, length-of-stay, pharmacy, transplant and disability. What is a quality management review? It’s a review in which an IRO will audit the overall quality of a hospital’s management practice and determine if the hospital is doing everything it can to deliver the highest quality of care to its patients. What is an inter-rater reliability review? Inter-rater reliability is the degree of consensus between two or more coders or raters. Inter-rater reliability tells you to what degree the industry agrees about the cost for a specific procedure. Do IROs conduct plan-interpretation reviews? Yes. IROs are reading health-plan language all the time. They are interpreting it to consider whether newer standard-of-care treatments are covered by a policy. In a sense, they are expanding the coverage for enrollees by doing so. So medical specialists can review a plan and interpolate which procedures are covered or ought to be. Do IROs conduct pharmacy reviews? Yes. AllMed does drug utilization reviews for pharmacy benefit managers (PBMs) and other entities that either provide or pay for drug coverage. Can an IRO help interpret healthcare plan language? Physician specialists review a plan and interpolate which procedures are covered − or ought to be − all the time.
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