Prior authorization in Minnesota, as it relates to private health plans, is governed by Minn. Stat. § 62M.01 to 62M.16 also commonly referred to as the “Minnesota Utilization Review Act of 1992.” (Some “Minnesota Health Care Program” health plans may have additional authorization requirements, because the State of Minnesota may be involved in administering the plan rather than strictly an insurance company. See the current Minnesota Health Care Program Manual for more information.) The most applicable part of the Act in regard to prior authorizations as they relate to patients is located in Minn. Stat. § 62M.07 which states:
62M.07 PRIOR AUTHORIZATION OF SERVICES.
(a) Utilization review organizations conducting prior authorization of services must have written standards that meet at a minimum the following requirements:
(1) written procedures and criteria used to determine whether care is appropriate, reasonable, or medically necessary;
(2) a system for providing prompt notification of its determinations to enrollees and providers and for notifying the provider, enrollee, or enrollee’s designee of appeal procedures under clause (4);
(3) compliance with section 62M.05, subdivisions 3a and 3b, regarding time frames for approving and disapproving prior authorization requests;
(4) written procedures for appeals of denials of prior authorization which specify the responsibilities of the enrollee and provider, and which meet the requirements of sections 62M.06 and 72A.285, regarding release of summary review findings; and
(5) procedures to ensure confidentiality of patient-specific information, consistent with applicable law.
(b) No utilization review organization, health plan company, or claims administrator may conduct or require prior authorization of emergency confinement or emergency treatment. The enrollee or the enrollee’s authorized representative may be required to notify the health plan company, claims administrator, or utilization review organization as soon after the beginning of the emergency confinement or emergency treatment as reasonably possible.
(c) If prior authorization for a health care service is required, the utilization review organization, health plan company, or claim administrator must allow providers to submit requests for prior authorization of the health care services without unreasonable delay by telephone, facsimile, or voice mail or through an electronic mechanism 24 hours a day, seven days a week. This paragraph does not apply to dental service covered under MinnesotaCare or medical assistance.
In summary, any utilization review organization, such as an insurance company, which requires prior authorizations for coverage of services must comply with Minn. Stat. § 62M.07. Therefore, the insurance company must have “written procedures and criteria used to determine whether care is appropriate, reasonable, or medically necessary”. Also, after a proper prior authorization request is sent to the insurance company, the insurance company must approve or disapprove the prior authorization in compliance with Minn. Stat. § 62M.05 stating, in part:
62M.05 PROCEDURES FOR REVIEW DETERMINATION.
Subd. 3a. Standard review determination.
(a) Notwithstanding subdivision 3b, an initial determination on all requests for utilization review must be communicated to the provider and enrollee in accordance with this subdivision within ten business days of the request, provided that all information reasonably necessary to make a determination on the request has been made available to the utilization review organization.
(b) When an initial determination is made to certify, notification must be provided promptly by telephone to the provider. The utilization review organization shall send written notification to the provider or shall maintain an audit trail of the determination and telephone notification. For purposes of this subdivision, “audit trail” includes documentation of the telephone notification, including the date; the name of the person spoken to; the enrollee; the service, procedure, or admission certified; and the date of the service, procedure, or admission. If the utilization review organization indicates certification by use of a number, the number must be called the “certification number.” For purposes of this subdivision, notification may also be made by facsimile to a verified number or by electronic mail to a secure electronic mailbox. These electronic forms of notification satisfy the “audit trail” requirement of this paragraph.
In summary, the insurance company must approve or disapprove a prior authorization request within ten business days, provided that all information reasonably necessary to make a determination on the request has been made available to the insurance company. The definition of what information is “reasonably necessary to make a determination on the request” should be spelled out in the insurance company’s own policy or the policy described in the health benefit plan.
Penalties and enforcements of this Act are governed by Minn. Stat. § 62M.03, Subd. 3 which states:
Subd. 3.Penalties and enforcements.
If a utilization review organization fails to comply with sections 62M.01 to 62M.16, the organization may not provide utilization review services for any Minnesota resident. The commissioner of commerce may issue a cease and desist order under section 45.027, subdivision 5, to enforce this provision. The cease and desist order is subject to appeal under chapter 14. A nonlicensed utilization review organization that fails to comply with the provisions of sections 62M.01 to 62M.16 is subject to all applicable penalty and enforcement provisions of section 72A.201. Each utilization review organization licensed under chapter 60A, 62C, 62D, 62N, 62T, or 64B shall comply with sections 62M.01 to 62M.16 as a condition of licensure.
The enforcement mechanism for violations of this Act in Minnesota is through the Minnesota Department of Commerce, and in part, the Minnesota Department of Health. I recommend that all providers and patients submit complaints with the Minnesota Department of Commerce and the Minnesota Department of Health for each suspected violation of this Act, in order to ensure proper enforcement in Minnesota. A patient or provider may have a separate cause of action, not highlighted in this Act, through a private contract or other cause of action. I recommend providers and patients consult with an attorney to determine what legal action is available in their specific case.
* This post does not take into consideration any law changes after the date of this post.*