Date:November 23, 2010
To:All Insurers Authorized to Write Group or Individual Health Insurance
From:Sean Dilweg, Commissioner of Insurance
Subject:Amendments to Grievances and Independent Review Procedure Rule

This bulletin summarizes the changes to ch. Ins 18, Wis. Adm. Code, to implement 2009 Wisconsin Act 28, which expanded the existing independent review rights for Wisconsin insureds to include preexisting condition exclusion denial determinations and rescissions of coverage.

The amended rule became effective October 1, 2010. Once the Office of the Commissioner of Insurance makes a determination that at least one independent review organization has been certified by the Office to provide independent reviews for preexisting condition exclusion denial determinations and rescissions, a notice will be published in the Wisconsin Administrative Register providing the date on which the independent review process begins for these types of determinations.

You should carefully review the amended administrative rule to determine how the changes apply to your company. It is each insurer's responsibility to ensure that its internal grievance and independent review procedures comply with the new regulation.

The rule is amended throughout to replace the terms "adverse determination" and "experimental treatment determination" with the more inclusive term "coverage denial determination." All references to the requirement that the insured pay a $25 fee have been repealed.

Definitions

Section Ins 18.01
Definitions were added for "coverage denial determination" and for "rescission" or "reformation" of a policy. The definition of "grievance" was amended to include dissatisfaction with an insurer's determination to reform or rescind a policy as well as an insurer's determination of a diagnosis or level of service required for evidence-based treatment of autism spectrum disorders.

Grievance Procedures

Section Ins 18.05, Expedited Grievance Procedure
The expedited grievance procedure was amended to require an insurer, upon written request, to mail or electronically mail a complete copy of the policy to the insured or insured's authorized representative as expeditiously as the grievance is handled.

Independent Review Procedures

Section Ins 18.10, Definitions
Definitions were added for "preexisting condition exclusion denial determination" and for "legal basis."

Section Ins 18.11, Notification of Right to Independent Review
Section Ins 18.11 (2) (a) 5 requires the notice to include a statement that the independent review organization’s decision regarding an adverse determination or an experimental treatment determination may be binding on the insurer and insured. The notice shall also indicate that for preexisting condition exclusion and rescission determinations, the determination is not binding on the insured.

Section Ins 18.11 (2) (a) 7 requires the notice to include a brief summary statement regarding Health Insurance Risk-Sharing Plan eligibility when the coverage denial determination involves a policy rescission.

NOTE: Section Ins 18.11 (2) (b) 1 requires the insurer to provide a notice of the right to request an independent review to all insureds who received a preexisting condition exclusion denial or rescission determination on or after January 1, 2010, but prior to the date stated in the notice published in the Wisconsin Administrative Register. The notice should be provided to each affected insured within 60 days of the publication date in the Register.

Section Ins 18.11 (3) Independent Review Timeframes
Section Ins 18.11 (3) (bm) requires an insurer, upon written request from an insured or an insured's authorized representative, to mail or electronically mail a complete copy of the policy within 3 business days.

Section Ins 18.11 (4) Disputes
When an insured and an insurer disagree regarding the eligibility of an appeal for an independent review, the insurer is required to send the appeal to the independent review organization for its decision. However, a dispute that is solely related to an administrative decision is not eligible for an independent review.

Section Ins 18.12 Independent Review Organization Procedures
Section Ins 18.12 (1) (k) requires the independent review organization to have procedures for determining when the inclusion of an attorney or actuary as a member of the review panel is appropriate and necessary.

Section Ins 18.12 (4) was amended to require that legal reviewers be attorneys licensed and in good standing in Wisconsin and that actuaries be members in good standing of the American Academy of Actuaries.

Section Ins 18.13 Standards for Review
Section Ins 18.13 (1) indicates that an independent review organization should consider medical or scientific evidence, the legal basis, and the applicable insurance contract in its review of coverage denial determinations other than experimental treatment determinations.

Questions concerning the grievance procedure can be e-mailed to:

Linda Low
linda.low@wisconsin.gov

Questions concerning the independent review process can be e-mailed to:

Barbara Belling
barbara.belling@wisconsin.gov