Medical Necessity in Private Health Plans

Table 4. Medical Necessity Definitions Contained in State Statutes and Regulations

State	Statute/Regulation	Medical Necessity Definition¹
Alabama	None	None
Alaska	None	None
Arizona	None	None
Arkansas	Ark. Code § 23-99-507 (2001)	(b) The term "medical necessity" as applied to benefits for mental illness and developmental disorders means: (1) Reasonable and necessary for the diagnosis or treatment of a mental illness, or to improve or to maintain or to prevent deterioration of functioning resulting from the illness or developmental disorder; (2) Furnished in the most appropriate and least restrictive setting in which services can be safely provided; (3) The most appropriate level or supply of service which can safely be provided; and (4) Could not have been omitted without adversely affecting the individual's mental or physical health, or both, or the quality of care rendered.
California	Cal. Wel. & Inst. Code § 14059.5 (2001)	"Medically necessary" or "medical necessity": A service is "medically necessary" or a "medical necessity" when it is reasonable and necessary to protect life, to prevent significant illness or significant disability, or to alleviate severe pain.
Colorado	None	None
Connecticut	None	None
Delaware	16 Del. Code § 9119 (2000) (IRO Statute)	For the purpose of this act, "medical necessity" means the providing of covered health services or products that a prudent physician would provide to a patient for the purpose of diagnosing or treating an illness, injury, or disease or its symptoms, in a manner that is: (1) In accordance with the generally accepted standards of medical practice; (2) Consistent with the symptoms or treatment of the condition; and (3) Not solely for anyone's convenience.
District of Columbia	None	None
Florida	Fla. Stat. § 627.732 (2001)	"Medically necessary" refers to a medical service or supply that a prudent physician would provide for the purpose of preventing, diagnosing, or treating an illness, injury, disease, or symptom in a manner that is: (a) In accordance with generally accepted standards of medical practice; (b) Clinically appropriate in terms of type, frequency, extent, site, and duration; and (c) Not primarily for the convenience of the patient, physician, or other health care provider.
Georgia	O.C.G.A. § 33-20A-31 (2000) (IRO Statute)	(5) "Medical necessity," "medically necessary care," or "medically necessary and appropriate" means care based upon generally accepted medical practices in light of conditions at the time of treatment which is: (A) Appropriate and consistent with the diagnosis and the omission of which could adversely affect or fail to improve the eligible enrollee's condition; (B) Compatible with the standards of acceptable medical practice in the United States; (C) Provided in a safe and appropriate setting given the nature of the diagnosis and the severity of the symptoms; (D) Not provided solely for the convenience of the eligible enrollee or the convenience of the health care provider or hospital; and (E) Not primarily custodial care, unless custodial care is a covered benefit under the eligible enrollee's evidence of coverage.
Hawaii	HRS § 432E-1.4 (2000) (IRO Statute)	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 the purposes of this paragraph, cost-effective shall not necessarily mean lowest price.
Idaho	None	None
Illinois	215 ILCS 105/2 (2001)	"Medically necessary" means that a service, drug, or supply is necessary and appropriate for the diagnosis or treatment of an illness or injury in accord with generally accepted standards of medical practice at the time the service, drug, or supply is provided. When specifically applied to a confinement it further means that the diagnosis or treatment of the covered person's medical symptoms or condition cannot be safely provided to that person as an outpatient. A service, drug, or supply shall not be medically necessary if it: (i) is investigational, experimental, or for research purposes; or (ii) is provided solely for the convenience of the patient, the patient's family, physician, hospital, or any other provider; or (iii) exceeds in scope, duration, or intensity that level of care that is needed to provide safe, adequate, and appropriate diagnosis or treatment; or (iv) could have been omitted without adversely affecting the covered person's condition or the quality of medical care; or (v) involves the use of a medical device, drug, or substance not formally approved by the United States Food and Drug Administration.
Indiana	None	None
Iowa	Iowa Code 514J.5	Medical necessity is defined as the insurer's plan defines it.
Kansas	None	None
Kentucky	None	None
Louisiana	None	None
Maine	24-A M.R.S. § 4301-A (11) (2000)	Medical Necessity. "Medical necessity" means health care services or products that a prudent physician or other health care practitioner would provide to an enrollee for the purpose of preventing, diagnosing, or treating an illness, injury, disease, or the symptoms of an illness, injury, or disease in a manner that is: (A) In accordance with generally accepted standards of medical practice; (B) Clinically appropriate in terms of type, frequency, extent, site, and duration; and (C) Not primarily for the convenience of the enrollee or physician or other health care practitioner.
Maryland	COMAR § 10.09.62.01 (2001) (Medicaid Managed Care Regulations)	"Medical necessity" means what is medically necessary and appropriate.
Massachusetts	Mass. Ann. Laws ch. 176O (1) (2001) (IRO Statute)	"Medical necessity" or "medically necessary." health care services that are consistent with generally accepted principles of professional medical practice.
Michigan	None	None
Minnesota	Minn. Stat. § 62Q.53 (2000) (IRO Statute)	"Medically necessary care" means health care services appropriate, in terms of type, frequency, level, setting, and duration, to the enrollee's diagnosis or condition, and diagnostic testing and preventive services. Medically necessary care must be consistent with generally accepted practice parameters as determined by health care providers in the same or similar general specialty as typically manages the condition, procedure, or treatment at issue and must: (1) help restore or maintain the enrollee's health; or (2) prevent deterioration of the enrollee's condition.
Mississippi	None	None
Missouri	None	None
Montana	None	None
Nebraska	None	None
Nevada	None	None
New Hampshire	None	None
New Jersey	None	None
New Mexico	None	None
New York	Proposed Legislation A.5048a (2001) (In Assembly Committee on Rules as of January 9, 2002)	PROPOSED DEFINITION: "medically necessary" means, with respect to a health care service, that it has been reasonably determined, and could be shown, by the enrollee's health care professional in consultation with the patient, or could be reasonably determined and shown by a health care professional in consultation with the patient, to be consistent with the enrollee's condition, circumstances and best interests in relation to type, frequency, site and duration, and with professional health care practice, unless it is reasonably shown by means of substantial medical and scientific literature, and considering the enrollee's condition, circumstances and best interests, that either (a) that the health care service would be unsafe or ineffective, or (b) that the health care plan's preferred health care service or no service would lead to an equally good outcome. "Medical necessity" is the quality of being medically necessary. All definitions in section forty-nine hundred of this chapter shall apply to this subdivision.
North Carolina	G.S. § 58-3-200(b)	Medical Necessity-An insurer that limits its health benefit plan coverage to medically necessary services and supplies shall define "medically necessary services or supplies" in its health benefit plan as those covered services or supplies that are: (1) Provided for the diagnosis, treatment, cure, or relief of a condition, illness, injury, or disease; and, except as allowed under G.S.58-3-255, not for experimental, investigational, or cosmetic purposes. (2) Necessary for and appropriate to the diagnosis, treatment, cure, or relief of a health condition, illness, injury, disease, or its symptoms. (3) Within generally accepted standards of medical care in the community. (4) Not solely for the convenience of the insured, the insured's family, or the provider. For medically necessary services, nothing in this subsection precludes an insurer from comparing the cost-effectiveness of alternative services or supplies when determining which of the services or supplies will be covered.
North Dakota	None	None
Ohio	None	None
Oklahoma	O.A.C. § 317:30-5-46 (2000) (Statute regarding inpatient psychiatric facilities)	(B) Medical necessity criteria for acute psychiatric admissions. Acute psychiatric admissions for children 13 or older must meet the terms and conditions contained in (i), (ii), (iii) and two of the (iv)(I) to (v)(III) of this subparagraph. Children 12 or younger must meet the terms or conditions contained in (i), (ii), (iii) and one of (iv)(I) to (iv)(IV), and one of (v)(I) to (v)(III) of this subparagraph. (i) Any DSM-IV-R Axis 1 primary diagnosis with the exception of V-codes, adjustment disorders, and substance related disorders, accompanied by a detailed description of the symptoms supporting the diagnosis. In lieu of a qualifying Axis I diagnosis, children 18-21 years of age may have an Axis II diagnosis of any personality disorder. (ii) Conditions are directly attributable to a mental disorder as the primary need for professional attention (this does not include placement issues, criminal behavior, status offenses). Adjustment or substance related disorder may be a secondary Axis I diagnosis. (iii) It has been determined by the Gatekeeper that the current disabling symptoms could not have been managed or have not been manageable in a lesser intensive treatment program. (iv) Within the past 48 hours the behaviors present an imminent life threatening emergency such as evidenced by: (I) Specifically described suicide attempts, suicide intent, or serious threat by the patient. (II) Specifically described patterns of escalating incidents of self-mutilating behaviors. (III) Specifically described episodes of unprovoked significant physical aggression and patterns of escalating physical aggression in intensity and duration. (IV) Specifically described episodes of incapacitating depression or psychosis that result in an inability to function or care for basic needs. (v) Requires secure 24-hour nursing/medical supervision as evidenced by: (I) Stabilization of acute psychiatric symptoms. (II) Needs extensive treatment under physician direction. (III) Physiological evidence or expectation of withdrawal symptoms which require 24-hour medical supervision. (C) Medical necessity criteria for continued stay-acute psychiatric admission. Continued stay-acute psychiatric admissions must meet all of the conditions set forth in (i) to (iv) of this subparagraph. (i) Any DSM-IV-R axis 1 primary diagnosis with the exception of V-Codes, adjustment disorders, and substance abuse related disorders, accompanied by a detailed description of the symptoms supporting the diagnosis. In lieu of a qualifying Axis I diagnosis, children 18-20 years of age may have an Axis II diagnosis or any personality disorder. Adjustment or substance related disorders may be a secondary Axis I diagnosis. (ii) Patient continues to manifest a severity of illness that requires an acute level of care as defined in the admission criteria and which could not be provided in a less restrictive setting. (I) Documentation of regression is measured in behavioral terms. (II) If condition is unchanged, evidence of re-evaluation of treatment objectives and therapeutic interventions. (iii) Conditions are directly attributable to a mental disorder as the primary need for professional attention (this does not include placement issues, criminal behavior, status offenses). (iv) Documented efforts of working with child's family, legal guardians and/or custodians and other human service agencies toward a tentative discharge date. (D) Medical necessity criteria for admission-inpatient chemical dependency detoxification. Inpatient chemical dependency detoxification admissions must meet the terms and conditions contained in (i), (ii), (iii), and one of (iv)(I)-(v)(IV). (i) Any psychoactive substance dependency disorder described in DSM-IV-R with detailed symptoms supporting the diagnosis and need for medical detoxification, except for cannabis, nicotine, or caffeine dependencies. (ii) Conditions are directly attributable to a substance dependency disorder as the primary need for professional attention (this does not include placement issues, criminal behavior, status offenses). (iii) It has been determined by the gatekeeper that the current disabling symptoms could not be managed or have not been manageable in a lesser intensive treatment program. (iv) Requires secure 24-hour nursing/medical supervision as evidenced by: (I) Need for active and aggressive pharmacological interventions. (II) Need for stabilization of acute psychiatric symptoms. (III) Need extensive treatment under physician direction. (IV) Physiological evidence or expectation of withdrawal symptoms which require 24-hour medical supervision. (E) Medical necessity criteria for continued stay-inpatient chemical dependency program. No continued stay in inpatient chemical dependency program is allowed. Initial certification for admission is limited to up to five days; exceptions may be made up to seven to eight days based on a case-by-case review. (F) Medical necessity criteria for admission-residential treatment (psychiatric and chemical dependency). Residential Treatment Center admissions must meet the terms and conditions in (i) to (iv) and one of (v)(I)-(v)(IV), and one of (vi)(I)-(vi)(III) of this subparagraph. (i) Any DSM-IV-R Axis 1 primary diagnosis with the exception of V-codes, adjustment disorders, and substance related disorders, accompanied by detailed symptoms supporting the diagnosis. In lieu of a qualifying Axis I diagnosis, children 18-20 years of age may have an Axis II diagnosis or any personality disorder. Adjustment or substance related disorders may be a secondary Axis I diagnosis. (ii) Conditions are directly attributed to a mental disorder as the primary reason for professional attention (this does not include placement issues, criminal behavior, status offenses). (iii) Patient has either received treatment in an acute care setting or it has been determined by the gatekeeper that the current disabling symptoms could not or have not been manageable in a less intensive treatment program. (iv) Child must be medically stable. (v) Patient demonstrates escalating pattern of self injurious or assaultive behaviors as evidenced by: (I) Suicidal ideation and/or threat. (II) History of or current self-injurious behavior. (III) Serious threats or evidence of physical aggression. (IV) Current incapacitating psychosis or depression. (vi) Requires 24-hour observation and treatment as evidenced by: (I) Intensive behavioral management. (II) Intensive treatment with the family/guardian and child in a structured milieu. (III) Intensive treatment in preparation for re-entry into community. (G) Medical necessity criteria for continued stay-residential treatment center. Continued stay residential treatment center admissions must meet the terms and conditions contained in (i); (ii); and either (iii) or (iv); and (v); and (vi) of this subparagraph. (i) Any DSM-IV-R Axis 1 primary diagnosis with the exception of V codes, adjustment disorders, and substance abuse related disorders, accompanied by detailed symptoms supporting the diagnosis. In lieu of a qualifying Axis I diagnosis, children 18-20 years of age may have an Axis II diagnosis of any personality disorder. (ii) Conditions are directly attributed to a mental disorder as the primary reason for continued stay (this does not include placement issues, criminal behavior, status offenses). (iii) Patient is making measurable progress toward the treatment objectives specified in the treatment plan. (I) Progress is measured in behavioral terms and reflected in the patient's treatment and discharge plans. (II) Patient has made gains toward social responsibility and independence. (III) There is active, ongoing psychiatric treatment and documented progress toward the treatment objective and discharge. (IV) There are documented efforts and evidence of active involvement with the family, guardian, child welfare worker, extended family, etc. (iv) Child's condition has remained unchanged or worsened. (I) Documentation of regression is measured in behavioral terms. (II) If condition is unchanged, there is evidence of re-evaluation of the treatment objectives and therapeutic interventions. (v) There is documented continuing need for 24-hour observation and treatment as evidenced by: (I) Intensive behavioral management. (II) Intensive treatment with the family/guardian and child in a structured milieu. (III) Intensive treatment in preparation for re-entry into community. (vi) Documented efforts of working with child's family, legal guardian and/or custodian and other human service agencies toward a tentative discharge date. (A) Pre-authorization and extension procedures. Pre-admission authorization for inpatient psychiatric services must be requested from the OHCA designated agent. The OHCA or designated agent will evaluate and render a decision within 24 hours of receiving the request. A Certificate of Need will be issued by the OHCA or its designated agent, if the recipient meets medical necessity criteria. (B) Extension requests (psychiatric) must be made through the OHCA designated agent. All requests shall be made prior to the expiration of the approved extension following the guidelines in the Gatekeeping Manual. Extension requests for the continued stay of a child who has been in an acute psychiatric program for a period of thirty (30) days will require a face to face evaluation by the gatekeeper. Requests for the continued stay of a child who has been in an acute psychiatric program for a period of sixty (60) days will require a review of all treatment documentation completed by the OHCA designated agent. (C) If a denial decision is made, a reconsideration request may be made directly to the OHCA designated agent within ten (10) working days of notification of the denial. The agent will return a decision within ten (10) working days from the time of receiving the reconsideration request. If the denial decision is upheld, the denial can be appealed to the Oklahoma Health Care Authority within 20 working days of notification of the denial by the OHCA designated agent.
Oregon	None	None
Pennsylvania	None	None
Rhode Island	None	None
South Carolina	None	None
South Dakota	S.D. Codified Laws 28-13-27.1 (2001)	Medically necessary hospital services are services provided in a hospital which meet the following criteria: (1) Are consistent with the person's symptoms, diagnosis, condition, or injury; (2) Are recognized as the prevailing standard and are consistent with generally accepted professional medical standards of the provider's peer group; (3) Are provided in response to a life-threatening condition; to treat pain, injury, illness, or infection; to treat a condition which would result in physical or mental disability; or to achieve a level of physical or mental function consistent with prevailing standards for the diagnosis or condition; (4) Are not furnished primarily for the convenience of the person or the provider; and (5) There is no other equally effective course of treatment available or suitable for the person needing the services which is more conservative or substantially less costly. A court shall rely on the attending physician's determination as to medical necessity of hospital services unless evidence exists to the contrary.
Tennessee	None	None
Texas	None	None
Utah	None	None
Vermont	None	None
Virginia	Va. Code Ann. § 38.2-5800 (2001) (IRO Statute)	"Medical necessity" or "medically necessary" means appropriate and necessary health care services which are rendered for any condition which, according to generally accepted principles of good medical practice, requires the diagnosis or direct care and treatment of an illness, injury, or pregnancy-related condition, and are not provided only as a convenience.
Washington	Rev. Code Wash. § 71.34.020 (2001) (mental health services for minors)	Medical necessity for inpatient care means a requested service which is reasonably calculated to: (a) Diagnose, correct, cure or alleviate a mental disorder; or (b) prevent the worsening of mental conditions that endanger life or cause suffering and pain, or result in illness or infirmity or threaten to cause or aggravate a handicap, or cause physical deformity or malfunction, and there is no adequate less restrictive alternative available.
West Virginia	None	None
Wisconsin	None	None
Wyoming	None	None

¹ Definitions have been taken verbatim from the relevant document; quotation marks have been omitted.

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