Issued and entered November 27, 2002 by Frank M. Fitzgerald, Commissioner

ORDER

I
PROCEDURAL BACKGROUND

On February 7, 2002, Petitioner XXXXXXXXXXX filed a request for external review with the Commissioner of Financial and Insurance Services (Commissioner) under the Patient’s Right to Independent Review Act (PRIRA), MCL 550.1901 et seq. The Office of Financial and Insurance Services (OFIS) reviewed the material and the request was accepted on February 19, 2002. The Commissioner immediately notified Care Choices HMO (Care Choices) of the request for external review and requested the information it used in its adverse determination. OFIS received Care Choices’ information on March 6, 2002.

OFIS originally believed the case involved only a contractual issue. But on closer review, a medical issue arose; namely whether the Petitioner’s condition constituted an emergency. The Commissioner then issued an Interim Order requiring a case review by an Independent Review Organization (IRO). The Interim Order was dated April 18, 2002 and is attached.

The IRO submitted its medical opinion to OFIS on May 14, 2002. A copy of the report is attached.

II
FACTUAL BACKGROUND

Petitioner, a member of Care Choices, seeks coverage for out-of-network surgical services she received in October and December 2001 at XXXXXXXXXX Hospital in XXXXXX, Wisconsin. Prior to receiving these services, Petitioner obtained a referral from her primary care physician, Dr. XXXXX. He referred her to Dr. XXXXXXX in XXXXXX, Wisconsin, but Care Choices did not approve this referral.

Initially, Petitioner experienced severe right side abdominal pain, fever and nausea. Her primary care physician (PCP) referred her to Dr. XXXXXXXXXXXXX. for an E.R.C.P. ultrasound under local anesthesia. On October 4, 2001, Dr. XXXX examined Petitioner but was unable to complete the ERCP because Petitioner experienced other medical problems. Dr. XXXX then recommended that Petitioner see Dr. XXXXXX so that she might have the ERCP procedure completed.

On October 24, 2001, Dr. XXXXXX performed an ERCP on Petitioner at XXXXXXXXXX Hospital in XXXXXX Wisconsin. During this procedure, Dr. XXXXX inserted a pancreatic stent. He then told Petitioner to return in 6 weeks to check the pressure of the pancreas and to see if it was working properly. Care Choices subsequently informed Petitioner that in-network care was available at The University of Michigan and therefore, Dr. XXXXXXX services were not covered.

On October 22, 2001, Petitioner’s primary care physician filed a request with Care Choices to approve the referral to Dr. XXXXXX. Care Choices denied the request.

III
ISSUE

Whether Care Choices properly denied Petitioner referral and coverage for out-of-network surgical and related services provided by Dr. XXXXXXXXXXXXX in XXXXX Wisconsin?

IV
ANALYSIS

Petitioner’s Position

Petitioner seeks coverage for out-of-network medical services. She claims her PCP referred her to Dr. XXXXXX, but Care Choices did not approve this referral. She believes Care Choices should have approved the referral and should pay for the procedures performed by Dr. XXXXXX.

Petitioner claims that since Dr. XXXXXX performed the initial (but uncompleted) pancreatic stent procedure, no physician within or outside of Michigan would be willing to open themselves to a lawsuit by finishing the procedure.

Petitioner asserts Care Choices should pay for the procedure at the rate it would have paid, had the procedure been performed “in-plan.” Petitioner states that, if Dr. XXXXXXXX bill exceeds what a Michigan physician would have charged at a Michigan facility, she would be willing to pay the difference.

Care Choices HMO’s Position

Care Choices relied on its Member Handbook and Subscriber Certificate to support its final adverse determination. The Care Choices Member Handbook provides:

Page 5: Important Tips About Your Coverage

Care Choices HMO will only pay for care and services provided by non-participating physicians and healthcare facilities that is approved in advance by Care Choices HMO’s Medical Director. [emphasis added]

Page 13: When you need a specialist

When you need care, your Primary Care Physician will usually treat you or give service. However, there may be times when your physician decides you need to see a Care Choices HMO specialist. In most cases your Primary Care Physician will refer you to a Care Choices HMO participating specialist who is part of his or her hospital network and community.

* * *

If your Primary Care Physician recommends a referral for specialty care and the physician or healthcare facility does not participate with Care Choices HMO, verify that:

• Your Primary Care physician contacted Care Choices HMO to obtain approval in advance from the Medical Director.
  
• You are approved for an out-of-network referral and have a Care Choices HMO approved authorization number. [emphasis added]

If the specialist recommends treatment:

• Check with your Primary Care Physician and your Care Choices HMO Subscriber Certificate and Schedule of Benefits or call Member Services to make sure the treatment is covered. You may need an additional referral from your Primary Care Physician for the treatment. [emphasis added]

Tip: Care Choices HMO only pays for specialty care and urgent care arranged by your Primary Care Physician unless you have an emergency condition. Specialty services must be provided by Care Choices HMO participating physicians unless you have special approval from the Care Choices HMO Medical Director. [emphasis added]

The Care Choices Subscriber Certificate states in pertinent part:

5.2 Covered Services – General

Requirements for Covered Services

Services covered by HMO must be:

(1) Provided by the PCP or arranged by the PCP and approved in advance by HMO, and

(2) Medically necessary, and

(3) A covered benefit, and

(4) Not specifically excluded from coverage, and

(5) Provided by a HMO Participating Provider, except in emergencies.

Care Choices contends that Petitioner self-directed her care to Dr.XXXXXX after she was dissatisfied with the proposed appointment dates at the University of Michigan. Care Choices claims this position is supported by the PCP’s letter noting Petitioner “wanted to get in as soon as possible.”

Care Choices asserts Petitioner knew or should have known that Care Choices would not cover out-of-plan services unless they have been previously approved, excluding emergency care. Specifically, Care Choices claims Petitioner knew there might not be coverage for the referral when, on October 23, 2001, the PCP’s office staff advised Petitioner’s husband Care Choices had not yet approved a referral to Dr. XXXXXX and that it might not approve such referral in the future.

Care Choices claims the services provided by Dr. XXXXXX were in the normal course of treatment, neither urgent care nor emergency care. In support, Care Choices points out that Dr. XXXXXXXX services were not provided until October 24, 2001, 20 days after Dr. XXXX attempted Petitioner’s ERCP.

Care Choices rejected Petitioner’s offer to cover any difference between what it would have been willing to pay the University of Michigan and what Dr. XXXXXX would have charged because health maintenance organizations in Michigan cannot accept partial payment and cannot balance bill. Care Choices further notes it has a contractual relationship with the University of Michigan as the “provider of choice” when Care Choices determines that services are not available within its provider network.

Commissioner’s Review

The analysis in this matter shall focus on the Certificate of Coverage. The Certificate is unquestionably the contract that applies in this case. The Certificate did not appear to incorporate the Member Handbook. Therefore, the terms of the Handbook are considered extrinsic.
The Certificate clearly states the PCP provides the covered service or arranges for covered services; and it states Care Choices must approve out-of-network services in advance. The only exception to this rule is when an emergency arises. Thus, if the facts demonstrate an emergency, then the condition of pre-approval would not apply.

The Certificate defines “emergency” as a “suddenly occurring medical condition or injury, which manifests itself by symptoms severe enough that a prudent lay person could reasonably expect that failure to obtain immediate medical attention would seriously jeopardize health or seriously impair bodily functions.” The IRO was directed to review the case file and to comment on whether the Petitioner required emergency care. The IRO report was rather general in its findings, but it nevertheless noted pertinent facts relating to any possible emergency.

In particular, the IRO stated:

[t]his was an unsuccessful ERCP, not a successful ERCP showing a stone. Moreover, laboratory studies from this time are not…suggestive of choledocholithisais.
Dr. XXXX explained in correspondence to Dr.XXX (see November letter) the rationale for his referral…He made this recommendation originally on 5 October 01, and Dr. XXXXXX performed the procedure…on 25 October 01.
Controversy between the patient and the HMO began to emerge around this time over the question of referral to University of Michigan rather than to Dr. XXXXXX. The patient’s stance was one of how soon the appointments could be made and how soon she could undergo the procedure… How much of a delay the [U of M] would have required is uncertain…perhaps one month.

The IRO noted the time it took for the original ERCP to be performed (about 20 days) and it noted the Petitioner was concerned about the amount of time it would take to be evaluated at the University of Michigan. The latter suggested the time frame to be seen at the University of Michigan was weeks or perhaps a month. There was no comment about the need for Petitioner to be treated immediately, or any concern that Petitioner need treatment on an emergency basis. The IRO’s findings therefore demonstrate the Petitioner’s condition was not within the definition of “emergency” as defined in the Certificate.

The Commissioner further finds that Care Choice’s Subscriber Certificate (5.2 Covered Services – General) specifically provides that covered services must be “provided by the PCP or arranged by the PCP and approved in advance by the HMO…” Neither the Petitioner nor her primary care physician obtained the approval from Care Choices prior to Dr. XXXXXX providing his services at XXXXXXXX Hospital in XXXXXX, Wisconsin. The Commissioner concludes the Care Choices final adverse determination was valid.

V
ORDER

The Commissioner ORDERS that the final adverse determination issued on December 18, 2001, by Care Choices HMO denying coverage for the October and December out-of-network medical services performed Dr. XXXXXXXXXXXXX, M.D., is upheld.

This is a final decision of an administrative agency. Under MCL 550.1915, any person aggrieved by this Order may seek judicial review no later than sixty days from the date of this Order in the Circuit Court for the county where the covered person resides or in the Circuit Court of Ingham County. A copy of the petition for judicial review should be sent to the Commissioner of the Office of Financial and Insurance Services, Health Plans Division, Post Office Box 30220, Lansing, MI 48909-7720.