November 6, 2002

The Michigan Patients Right to Independent Review Act (PRIRA) turned two years old on October 1, 2002. This act updated Michigan’s health maintenance organization (HMO) review process begun in 1978 and is administered by the Michigan Office of Financial and Insurance Services (OFIS). PRIRA has proven to be an efficient consumer protection measure for reviewing HMO and health insurance company denials.

“Michigan’s independent review of health insurers and HMOs denying coverage for treatment has provided consumers with independent decisions about whether the denial was fair,” said OFIS Commissioner Frank M. Fitzgerald. “The program benefits consumers by giving them with somewhere to turn for help.”

Since October 1, 2000, PRIRA has handled 665 cases. Of those cases, 355 cases are denials of coverage by Blue Cross Blue Shield of Michigan, 221 by HMOs, and the remaining 89 are commercial insurers and alternative financing delivery systems (AFDS). Additional detail for PRIRA case statistics can be reviewed on the OFIS web site at www.michigan.gov/documents/cis_ofis_compinfo_28032_7.html.

Use of the PRIRA process continues to grow. Forty-seven cases were handled during October through December 2000. For the calendar year 2001, PRIRA had 333 cases. Through September 20, 2002, PRIRA has handled 285 cases. OFIS is predicting that PRIRA will handle over 380 cases in 2002.

The PRIRA process has decided in favor of the consumer 44% of the time and upheld the coverage denial 56% of the time. This number is in line with the average experience of other states with an independent review process.

The most common medical procedures reviewed in the PRIRA process are bariatric surgery, breast reductions, dental crowns, physical therapy, and experimental procedures.

PRIRA consists of three simple steps:

• First, at the time of the coverage denial, consumers receive information from the health insurance company or HMO about the health plan’s internal appeal process.
• Second, if there is still a denial at the end of the internal appeal process, the health insurance company or HMO provides the consumer with PRIRA information.
• Third, within 35 days of the consumer’s request for a PRIRA appeal, OFIS will provide a final decision on the denial. If consumers are not satisfied with the external review decision, the matter can be taken to court.

The PRIRA process also allows for an expedited review process. If a physician thinks that the coverage denial threatens the life of the consumer in any way, PRIRA can be completed within 72 hours.

“The data shows that the independent review process works,” commented Steve Gools, State Director, AARP/Michigan. “We need to make sure that Michigan citizens understand that they have this service available, and that it can help ensure that they receive fair treatment from insurers and HMOs. The state needs to continue letting people know about this process, and AARP is willing to help get out the word.”

The PRIRA process can be used for denials from health insurers, HMOs, Alternative Finance and Delivery Systems (AFDS), and Blue Cross/Blue Shield of Michigan (BCBSM). Medicare supplement, disability income, hospital indemnity, specified accident, credit, self-funded health plans, or long-term care insurance policies do not qualify for the external review process. If consumers have a policy that does not qualify for external review or do not know what type of policy they have, OFIS staff can direct consumers to the correct process and agency.

"The most important thing to know is if that if there is a complaint about a denial from a health insurance company, Blue Cross Blue Shield of Michigan, or an HMO – call OFIS toll free at 877-999-6442," said Fitzgerald. "OFIS staff can explain the external review process and make sure consumers have the correct complaint process."

On October 1, 2002, OFIS started posting PRIRA decisions electronically to the OFIS web site. The decisions do not contain any personal information and can be accessed at www.michigan.gov/ofis by following the “Hearing and Decisions” link from the left hand side of the page. The direct link is http://www.michigan.gov/cis/0,1607,7-154-10555_20594---,00.html. OFIS is posting current decisions and will be posting PRIRA decisions from October 1, 2000 through October 1, 2002 in the near future.

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The Michigan Office of Financial and Insurance Services (OFIS) is responsible for the regulation of Blue Cross Blue Shield, 28 HMOs, 138 banks, 281 credit unions, almost 1,500 insurance companies, 1,583 investment advisers, 2,164 securities broker-dealers, 6,000 consumer finance lenders, 89,000 insurance agents, and 120,715 securities agents. OFIS is part of the Department of Consumer and Industry Services and is primarily fee-funded, requiring minimal public tax dollars for its regulatory and consumer assistance activities. OFIS has insurance, financial institutions and securities information available online at the OFIS web site, www.michigan.gov/ofis, or at the Michigan government home page, www.michigan.gov. All information is also available through the OFIS toll free number, (877) 999-6442. If you would like to receive OFIS press releases electronically, please email ofis-info@michigan.gov.