Date:April 26, 2002
To:All Insurers Licensed to do Health Insurance Business in Wisconsin
From:Connie L. O'Connell, Commissioner of Insurance
Subject:Ch. Ins 18, Wis. Adm. Code Health Benefit Plan Grievances and Independent Review Organizations Certification and Review Procedures

Chapter Ins 18, Wis. Adm. Code, was created to specify the standards that the Commissioner will use for the independent review process, including the standards for certifying and recertifying independent review organizations (IROs). On October 22, 2001, the office issued a bulletin that provided general information on the requirements of this administrative rule. The current bulletin informs insurers that the Commissioner has certified an IRO and highlights the requirements that insurers must use to establish internal grievance procedures and independent review procedures. This bulletin also discusses the section of 2001 Wis. Act 65 (Act 65) that amended s. 632.835 (2), Wis. Stat. and has an effective date of April 24, 2002.

AN IRO HAS BEEN CERTIFIED UNDER S. 632.835 (4), WIS. STAT. IN ADDITION, JUNE 15, 2002, IS THE DATE ON WHICH THE INDEPENDENT REVIEW PROCEDURE BECOMES OPERATIONAL. THE FOREGOING NOTICE WAS PUBLISHED IN THE APRIL 15, 2002, WISCONSIN ADMINISTRATIVE REGISTER.

Overview of Requirements

1999 Wis. Act 155 expanded the right to an internal grievance review to all individuals covered under a health benefit plan, as defined in s. 632.83 (1), Wis. Stat., also including: policies or certificates that provide hospital indemnity or other fixed indemnity coverage, limited-scope dental or vision coverage, as well as Medicare Supplement, Medicare Select, and Medicare Cost coverage when the grievance relates to issues not subject to federal regulation (i.e. Wisconsin mandated benefits). 1999 Wisconsin Act 155 required all insurers offering health benefit plans to establish an internal grievance procedure effective December 1, 2000, and to establish procedures, including notices to insureds, concerning the availability for independent review of adverse and experimental treatment determinations. As noted in the October 2001 bulletin, the effective date for independent review rights is tied to the Commissioner's certification of at least one independent review organization and applies retrospectively to insureds who received an adverse disposition of their grievance on or after December 1, 2000.

The requirements for an internal grievance procedure that had previously just applied to insurers offering managed care plans, and which were contained in s. Ins 9.33, Wis. Adm. Code, have been modified and now appear in subch. II of Ins 18, Wis. Adm. Code. Insurers should also note that the new right to request an independent review applies to all individuals covered under health benefit plans as defined in s. 632.835 (1) (c), Wis. Stat. This includes all types of health benefit plans that are required to include an internal grievance procedure except that it does not include policies or certificates that provide only limited-scope dental or vision coverage.

CHAPTER INS 18, WIS. ADM. CODE

SUBCHAPTER I - DEFINITIONS

Section Ins 18.01, Wis. Adm. Code, contains definitions that apply to insurers offering health benefit plans regarding the internal grievance procedure and the independent review process. Insurers should review the definitions of "complaint", "expedited grievance" and "grievance" to ensure that their internal complaint and grievance procedures are consistent with these definitions.

SUBCHAPTER II - GRIEVANCE PROCEDURES

Section Ins 18.03, Wis. Adm. Code, requires insurers to develop an internal grievance and expedited grievance procedure that is described in each policy and certificate. The insurer is required to notify the affected insured of the right to file a grievance each time it denies a claim or benefit or initiates disenrollment proceedings. The grievance procedure must include a process that allows the insured to attend the grievance panel meeting. This section also outlines requirements for the composition of the grievance panel, and timeframes for acknowledging receipt of a grievance and resolving a grievance.

Section Ins 18.05, Wis. Adm. Code, requires an insurer to develop a separate grievance procedure for expedited grievances and to resolve expedited grievances as expeditiously as the insured's health condition requires, but not more than 72 hours after receipt of the grievance.

Section Ins 18.06, Wis. Adm. Code, requires an insurer to maintain records on each complaint and each grievance submitted to the insurer for at least 3 years. This section also requires the insurer to submit the grievance experience report required by s. 632.83 (2) (c), Wis. Stat. to OCI by March 1 of each year on a form specified by OCI. The form is available at http://oci.wi.gov/ociforms/26_007_intro.htm.

SUBCHAPTER III - INDEPENDENT REVIEW PROCEDURES

Definitions

Section Ins 18.10, Wis. Adm. Code, contains the definitions that apply to independent reviews, including definitions of "adverse determination", "experimental treatment determination", "health benefit plan", and "medical or scientific evidence." It also defines "unbiased" as it applies to an independent review organization.

Section Ins 18.10 (1), Wis. Adm. Code, states that an adverse determination has the meaning as defined in s. 635.835 (1), Wis. Stat., and clarifies that this includes the denial of a request for a referral for out-of-network services when the insured requests health care services from a non-network provider because the clinical expertise of that provider may be medically necessary for treatment.

Independent Review Procedures

In accordance with s. 632.835 (8), Wis. Stat., the Commissioner published a notice on April 15, 2002, in the Wisconsin Administrative Register announcing that a comprehensive IRO has been certified. Insurers have 2 months from the notice publication date to prepare and send the required notices to their insureds regarding their right to seek independent review by a certified IRO. In all cases, the notice should be mailed to all affected insureds postmarked no later than June 15, 2002.

IRO Notice Requirements

Section 18.11 (2), Wis. Adm. Code, requires an insurer to provide a notice of the right to request an independent review to an insured whenever the insurer makes an adverse determination or an experimental treatment determination.

On April 10, 2002, the Governor signed Act 65, which amended s. 632.835 (2), Wis. Stat., to require insurers to comply with one of two methods of notification to insureds of the insured's right to independent review as delineated below. OCI requires the insurer to be in compliance with notification requirements, even if the insurer contracts with another entity for those services.

  1. Section 632.835 (2) (b), Wis. Stat.: The insurer must provide a complete notice to the insured of the right to request an independent review that includes all of the information listed in s. Ins 18.11 (2) (a), Wis. Adm. Code, if it makes an adverse determination or an experimental treatment determination.

    The notice shall include all of the following:

    1. A notice of the insured's grievance rights per s. Ins 18.03, Wis. Adm. Code.
    2. A statement that the insured, or his or her authorized representative, has the right to request an independent review.
    3. An explanation of how to request an independent review, minimally including all of the following:
      1. A statement that the insured or the authorized representative may choose an IRO from the attached list of IROs certified by OCI.
      2. A statement that the request must be made in writing, contain the name of the IRO chosen, and be accompanied by a $25 fee payable to the IRO.
      3. A statement that the $25 fee will be refunded if the insured prevails in the review, either in whole or in part.
      4. A statement that the request must be sent to the insurer, including the name of the person or position to whom the request is to be sent.
    4. A current list of certified IROs as maintained on OCI's website at http://oci.wi.gov updated at least quarterly.
    5. The OCI informational brochure or a substantially similar form available on OCI's website at http://oci.wi.gov/pub_list/pi-203.htm. Please note that the publication has been revised to reflect the recent statutory changes.
    6. A statement explaining the 4-month time limit for requesting an independent review.
    7. A statement that the IRO's decision is binding on the insurer and the insured.
    8. A statement explaining the exceptions to the requirement that the grievance process be completed prior to requesting an independent review.

    The insurer must include within the grievance provisions of its policies and certificates a statement regarding the insured's right to request an independent review. Each time the insurer resolves a grievance involving an adverse or experimental treatment determination, it must notify the insured of the right to request an independent review and refer the insured to the information that it had previously provided.

  2. Section 632.835 (2) (bg), Wis. Stat.: If an insurer complies with all of the requirements within the s. 632.835 (2) (bg), Wis. Stat., the insurer shall provide the insured with the information listed in s. Ins 18.11 (2) (a), Wis. Adm. Code at the time that the insurer sends the insured notice of the disposition of the internal grievance.

    Policy and Certificate Requirements

    Policies and certificates shall contain all of the following:

    1. Definitions of adverse determination and experimental treatment determination as defined in s. 632.835 (1) (a) and (b), Wis. Stat.
    2. A statement that the insured, or the insured's authorized representative, has the right to request an independent review.
    3. An explanation of how to request an independent review. Information provided must minimally include all of the following:
      1. A statement that the insured may choose an IRO from a list of IROs certified by OCI.
      2. A statement that the insured must submit a filing fee of $25 payable to the IRO with the request. The statement shall explain that the fee will be refunded to the insured if the insured prevails in the review, either in whole or in part.
      3. A statement that the request must be sent to the insurer, unless the reason for the review is an urgent matter.
      4. A statement that the insured must generally complete the internal grievance process before submitting a request for independent review. This statement must clearly explain the two exceptions to this requirement.
    4. A statement explaining the time limit for requesting an independent review.
    5. A statement that the IRO's decision is binding on the insurer and the insured.
    6. A statement explaining how to obtain a current list of certified IROs.

    Explanation of Benefits Requirements

    If an insurer makes an adverse or experimental treatment determination and issues an Explanation of Benefits, the insurer must include on its Explanation of Benefits form all of the following:

    1. A statement that the insured may have a right to an independent review after the internal grievance process is complete.
    2. A statement that the insured may be entitled to an expedited independent review with respect to an urgent matter.
    3. A reference to the section of the policy or certificate that contains the description of the independent review procedure consistent with s. 632.835 (1) (bg) 1., Wis. Stat.
    4. A toll-free telephone number and website, if applicable, where consumers may obtain additional information regarding both internal review and independent review.

    An example of a notice that would comply with this requirement is provided as Attachment X.

    Benefit or Claims Denials

    If an insurer makes an adverse or experimental treatment determination and no Explanation of Benefits is provided to the insured, the insurer must notify the insured of all of the following:

    1. The insured may have a right to an independent review after the internal grievance process is complete.
    2. The insured may be entitled to an expedited independent review with respect to an urgent matter.
    3. A reference to the section of the policy or certificate that contains the description of the independent review procedure consistent with s. 632.835 (1) (bg) 1., Wis. Stat.
    4. A toll-free telephone number and website, if applicable, where consumers may obtain additional information regarding both internal review and independent review.

    Grievance Disposition Notice

    An insurer must notify an insured of the right to request an independent review each time it resolves a grievance involving an adverse or experimental treatment determination. The notice included in the grievance decision letter shall contain a complete explanation of how to request an independent review, including all of the information specified in s. Ins 18.11 (2) (a), Wis. Adm. Code.

Implementation of Independent Review

Grievances Received Prior to the Implementation Date

An insurer must provide a notice of the right to request an independent review to all insureds who received a notice of the disposition of a grievance on or after December 1, 2000 and prior to June 15, 2002. The notice must include all of the information required in s. Ins 18.11 (2), Wis. Adm. Code, and must be postmarked to the insured no later than June 15, 2002. Insurers may not impose a time limit for filing a grievance. An insured who has received an adverse determination or an experimental treatment determination on or after December 1, 2000, and prior to June 15, 2002, may file a grievance after the implementation date. The insurer must be able to provide documentation that it notified the insured of the right to file a grievance at the time of the adverse or experimental treatment determination.

Independent Review Timeframes

Section 18.11 (3) (a), Wis. Adm. Code, requires an insurer to provide written notice to the Commissioner and to the IRO within 2 business days of its receipt of a request for independent review. The notice should include a unique identifier, the type of determination (adverse or experimental treatment determination), the date received by the insurer, the name of the chosen IRO, and the general subject of the request (for example: insured requesting coverage of treatment denied under exclusion for cosmetic treatment). The notice to the IRO shall include the name of the insured and the authorized representative, if applicable. The insurer shall also send the $25 filing fee to the IRO with the notice. However, the notice to OCI shall not include the name of the insured or authorized representative, the insured's social security number, or any other information that could identify the insured.

Section 18.11 (3), Wis. Adm. Code, requires an insurer to provide the required information to the IRO without requiring a written release form. The insurer is also required to promptly provide the insured or the insured's authorized representative, if applicable, with a copy of any additional information submitted at the request of the IRO.

All information must be submitted within the timeframes required by s. 632.835 (3), Wis. Stat. Attachment Y and Attachment Z provide examples of timeframes for the standard and expedited independent review processes. These charts are intended as sample timeframes and may not apply in all independent review cases.

Independent Review Organization Procedures

Section Ins 18.12, Wis. Adm. Code, contains the standards used by the Commissioner for certifying and recertifying independent review organizations. It requires the IRO to have, and demonstrate compliance with, written policies and procedures governing all aspects of the independent review process.

Section Ins 18.18, Wis. Adm. Code, requires a certified IRO to submit its fee schedule to the Commissioner for review and approval and requires fee schedules to be based on prevailing rates in the industry demonstrated by supporting credible documentation. The IRO may not change the fee schedules more than once per year. Insurers should note that this section also requires an insurer to pay the fee submitted by the IRO within 30 days of receipt of a written invoice from the IRO.

Contact Information

If you have questions concerning this bulletin, please put them in writing and address them to the appropriate contact persons listed below:

Grievance requirementsMarcia Zimmermarcia.zimmer@wisconsin.gov
Policy forms requirementsJamie Sanftleben jamie.sanftleben@oci.state.wi.us
IRO proceduresBarbara Belling barbara.belling@wisconsin.gov

The complete rule can be obtained by sending a written request, along with a self-addressed, stamped envelope to OCI's Central Files Section, or you may visit OCI's website at http://oci.wi.gov/rules/1800fn01.pdf to review or print a copy of the rule. (Note: You will need a copy of Adobe Acrobat Reader to view or print this pdf file which you can download from Adobe .)

This bulletin is not intended to be a complete discussion of ch. Ins 18, Wis. Adm. Code, or how the Office of the Commissioner of Insurance will interpret and implement the new regulations. It is each insurer's responsibility to determine which provisions are applicable to its health benefit plans, and to ensure that its policy forms and procedures are in compliance with the new rule.


Attachment X

Example of notice to be used on EOBs
or with other adverse or experimental treatment determinations.

Independent Review Rights

In addition to your rights to file a complaint or grievance concerning your claim or benefit denial, you may also be entitled to an independent review by medical professionals who have no connection to this insurer to address your concerns about this claim [or referral]. Typically, you must first complete the insurer's internal grievance process before you can initiate an independent review. However, you do not need to complete the grievance process if you need immediate medical treatment and the time period for completing the grievance process will cause a delay that could jeopardize your life or health or we agree with you that it is in everyone's best interest to proceed with your concern directly to independent review.

Please refer to Section _____ of your policy or visit our website at ________ for more information on your grievance and independent review rights. The section contains valuable information regarding the independent review process. A listing of certified independent review organizations may be obtained by calling our office at ___________ (800 number, if applicable) or visiting our website. Additional information may also be obtained from the Office of the Commissioner of Insurance (OCI) at 608-266-0103 (Madison) or 1-800-236-8517 (outside Madison), or OCI's website at oci.wi.gov.


Attachment Y

Timeframes for Standard Independent Review Process

 ActionByTime periodComments
1Adverse or Experimental Treatment Determination madeInsurer Insurer must send notice of right to grieve and right to independent review
2Grievance filedInsuredNo time limit for filing 
3Grievance resolvedInsurer30 days from receipt by insurerResolution letter should explain IRO right, if applicable
4Independent review requestedInsuredWithin 4 months of #3Request is sent to insurer with choice of IRO and $25 fee payable to IRO.
The request may also be submitted by an authorized representative of the insured.
5IRO and OCI notified of receipt of requestInsurer2 business days of #4Notice must be in writing;
$25 fee is forwarded to IRO with its notice
6Documentation submitted to IROInsurer5 business days of #4 
7Determination made if issue is reviewable by IROIRO2 business days of #6If not reviewable, IRO must notify insured, insurer and OCI
8Additional information requestedIRO5 business days of #6IRO may request additional information from insurer or from the insured
9Additional information submittedInsurer or Insured5 business days of #8If information is not available, an explanation must be submitted
10Decision madeIRO30 business days of #9 
11Insurer and insured notified of decisionIRO2 business days of #10Decision is binding on insurer and on insured
12Fees paid to IROInsurer30 days of receipt of bill 


Attachment Z

Timeframes for Expedited Independent Review Process

 ActionByTime periodComments
1Adverse or Experimental Treatment Determination madeInsurer Insurer must send notice of right to grieve and right to independent review
2Independent review request sent to insurer and to IROInsured  Insured or authorized representative requests IRO to bypass grievance process;
$25 fee is sent directly to IRO to initiate process.
3Determination made that requiring insured to use grievance process could jeopardize insured's life or health IRO  
4Documentation submitted to IROInsurer1 day of #2 
5OCI notifiedInsurer2 business days of #2Notice must be in writing
6Additional information requestedIRO2 business days of #4IRO may request additional information from insurer or from the insured
7Additional information submittedInsurer or Insured2 days of #6If information is not available, an explanation must be submitted
8Decision madeIRO72 hours of #7 
9Insurer and insured notified of decisionIRO1 hour of #8 or as soon as practicableDecision is binding on insurer and on insured
10Fees paid to IROInsurer30 days of receipt of bill