Definitions; Step therapy considerations
See the bold text below to see the sections of the statutes that fall under the applicable tags.
Section 2102. Definitions.
As used in this article, the following words and phrases shall have the meanings given to them in this section:
“Active clinical practice.” The practice of clinical medicine by a health care provider for an average of not less than twenty (20) hours per week.
“Administrative denial.” An adverse benefit determination of prior authorization, coverage or payment based on a lack of eligibility, failure to submit complete information or other failure to comply with an administrative policy. The term does not include an adverse benefit determination subject to the external review process as set forth in section 2164.1(a).
“Administrative policy.” A written document or collection of documents reflecting the terms of the contractual or operating relationship between an insurer or MA or CHIP managed care plan and a health care provider.
“Adverse benefit determination.” An adverse benefit determination may be any of the following:
(1) A determination by an insurer or a utilization review entity on behalf of an insurer that, based upon the information provided and upon application of utilization review, a request for a benefit under a health insurance policy does not meet the insurer’s requirements for medical necessity, appropriateness, health care setting, level of care or effectiveness or is determined to be experimental or investigational, such that the requested benefit is therefore denied, reduced or terminated or payment is not provided or made, in whole or in part, for the benefit.
(2) The denial, reduction, termination or failure to provide or make payment, in whole or in part, for a benefit based on a determination by an insurer of a person’s eligibility for coverage under a health insurance policy or noncompliance with an administrative policy.
(3) A rescission of coverage determination by an insurer.
“Agreement with the Department of Human Services.” An agreement between an MA or CHIP managed care plan and the Department of Human Services to manage the purchase and provision of services. The term includes a county or multicounty agreement with the Department of Human Services for behavioral health services.
“Ancillary service plans.” (Def. deleted by amendment).
“Applicable governmental guidelines.” Clinical practice and associated guidelines issued under the authority of the United States Department of Health and Human Services, United States Food and Drug Administration, Centers for Disease Control and Prevention, Pennsylvania Department of Health or other similarly situated Federal or State agency, department or subunit thereof focused on the provision or regulation of medical care, prescription drugs or public health within the United States or this Commonwealth.
“Authorized representative.” One of the following:
(1) A person, including a health care provider, to whom a covered person or enrollee has given express written consent to represent the covered person or enrollee in a complaint, grievance, adverse benefit determination, internal appeal or external review process.
(2) A person authorized by law to provide substituted consent for a covered person or enrollee.
(3) A family member or treating health care provider involved in providing health care to a covered person or enrollee if the covered person or enrollee is incapacitated or unable to provide consent due to a medical emergency or as necessary to prevent a serious and imminent threat to the health or safety of the covered person or enrollee.
“Clean claim.” A claim for payment for a health care service which has no defect or impropriety. A defect or impropriety shall include lack of required substantiating documentation or a particular circumstance requiring special treatment which prevents timely payment from being made on the claim. The term shall not include a claim from a health care provider who is under investigation for fraud or abuse regarding that claim.
“Clinical review criteria.” The set of written screening procedures, decision abstracts, clinical protocols and practice guidelines used by an insurer or MA or CHIP managed care plan to determine the necessity and appropriateness of health care services.
“Closely-related service.” A health care service subject to prior authorization that is closely related in purpose, diagnostic utility or designated health care billing code, and provided on the same date of service as an authorized service, such that a prudent health care provider, acting within the scope of the provider’s license and expertise, may reasonably be expected to perform the service in conjunction with or in lieu of the originally authorized service in response to minor differences in observed patient characteristics or needs for diagnostic information that were not readily identifiable until the provider was actually performing the originally authorized service. The term does not include an order for or administration of a prescription drug or any part of a series or course of treatments.
“Commissioner.” The Insurance Commissioner of the Commonwealth.
“Complaint.” A dispute or objection regarding a participating health care provider or the coverage, operations or management policies of an insurer or MA or CHIP managed care plan which has not been resolved by the insurer or MA or CHIP managed care plan and has been filed with the insurer, MA or CHIP managed care plan or department. The term does not include a grievance or an adverse benefit determination.
“Concurrent review.” A review performed by an insurer or MA or CHIP managed care plan, or by a utilization review entity acting on behalf of an insurer or MA or CHIP managed care plan, of all reasonably necessary supporting information which occurs during a covered person’s or an enrollee’s hospital stay or course of treatment and results in a decision to approve or deny payment for the health care service.
“Covered benefit.” A health care service as set forth in the terms of a health insurance policy or an agreement with the Department of Human Services.
“Covered person.” A policyholder, subscriber or other individual who is entitled to receive health care services under a health insurance policy.
“Department.” The Insurance Department of the Commonwealth.
“Discharge planning.” The formal process for determining, prior to discharge from a facility, the coordination and management of care that a covered person or enrollee will receive following the discharge.
“Drug formulary.” A listing of health insurance policy or MA or CHIP managed care plan preferred therapeutic drugs.
“Emergency service.” A health care service provided to a covered person or enrollee after the sudden onset of a medical condition that manifests itself by acute symptoms of sufficient severity or severe pain such that a prudent layperson who possesses an average knowledge of health and medicine could reasonably expect the absence of immediate medical attention to result in:
(1) placing the health of the covered person or enrollee in serious jeopardy or, with respect to a pregnant woman, the health of the woman or her unborn child in serious jeopardy;
(2) serious impairment to bodily functions; or
(3) serious dysfunction of any bodily organ or part.
Emergency transportation or related emergency service provided by a licensed ambulance service shall constitute an emergency service.
“Enrollee.” An individual who is entitled to receive health care services under an agreement with the Department of Human Services.
“Evidence-based standard.” Interventions and treatment approaches that have been proven effective through appropriate empirical analysis.
“Facility.” A health care setting or institution providing health care services, including:
(1) A general, special, psychiatric or rehabilitation hospital.
(2) An ambulatory surgical facility.
(3) A cancer treatment center.
(4) A birth center.
(5) A skilled nursing center.
(6) An inpatient, outpatient or residential drug and alcohol treatment facility.
(7) A facility licensed by the Department of Human Services’ Office of Mental Health and Substance Abuse Services.
(8) A laboratory, imaging, diagnostic or other outpatient medical service or testing facility.
(9) A health care provider office or clinic.
“Final adverse benefit determination.” An adverse benefit determination that has been upheld by an insurer or a utilization review entity designated by the insurer at the completion of the insurer’s internal claim and appeal procedures as specified in section 2164.
“Grievance.” A request to an MA or CHIP managed care plan by an enrollee or an enrollee’s authorized representative to have an MA or CHIP managed care plan reconsider a decision solely concerning the medical necessity, appropriateness, health care setting, level of care or effectiveness of a health care service. If the MA or CHIP managed care plan is unable to resolve the matter, a grievance may be filed regarding the decision that:
(1) disapproves full or partial payment for a requested health care service;
(2) approves the provision of a requested health care service for a lesser scope or duration than requested; or
(3) disapproves payment for the provision of a requested health care service but approves payment for the provision of an alternative health care service.
The term does not include a complaint or an adverse benefit determination.
“Health care provider.” A licensed hospital or health care facility, medical equipment supplier or person who is licensed, certified or otherwise regulated to provide health care services under the laws of this Commonwealth, including a physician, podiatrist, optometrist, psychologist, physical therapist, certified nurse practitioner, registered nurse, nurse midwife, physician’s assistant, chiropractor, dentist, pharmacist or an individual accredited or certified to provide behavioral health services. The term includes an individual providing emergency services under a licensed emergency medical services agency as defined in 35 Pa.C.S. § 8103 (relating to definitions).
“Health care service.” Any covered treatment, admission, procedure, medical supplies and equipment or other services, including behavioral health, prescribed or otherwise provided or proposed to be provided by a health care provider to a covered person or enrollee for the diagnosis, prevention, treatment, cure or relief of a health condition, illness, injury or disease under the terms of either a health insurance policy or an agreement with the Department of Human Services.
“Health insurance policy.” A policy, subscriber contract, certificate or plan issued by an insurer that provides medical or health care coverage. The term does not include any of the following:
(1) An accident only policy.
(2) A credit only policy.
(3) A long-term care or disability income policy.
(4) A specified disease policy.
(5) A Medicare supplement policy.
(6) A TRICARE policy, including a Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) supplement policy.
(7) A fixed indemnity policy.
(8) A hospital indemnity policy.
(9) A dental only policy.
(10) A vision only policy.
(11) A workers’ compensation policy.
(12) An automobile medical payment policy under 75 Pa.C.S. (relating to vehicles).
(13) A homeowner’s insurance policy.
(14) Any other similar policies providing for limited benefits.
“Independent review organization” or “IRO.” An entity approved by the department under section 2164.9 that conducts independent reviews of adverse benefit determinations, final adverse benefit determinations and grievances.
“Insurer.” An entity licensed by the department that offers, issues or renews an individual or group health insurance policy that is offered or governed under any of the following:
(1) This act, including section 630 and Article XXIV.
(2) The act of December 29, 1972 (P.L.1701, No.364), known as the “Health Maintenance Organization Act.”
(3) 40 Pa.C.S. Ch. 61 (relating to hospital plan corporations) or 63 (relating to professional health services plan corporations).
The term does not include an entity operating as an MA or CHIP managed care plan.
“Managed care plan.” (Def. deleted by amendment).
“Medical Assistance or Children’s Health Insurance Program managed care plan” or “MA or CHIP managed care plan.” A health care plan that uses a gatekeeper to manage the utilization of health care services by medical assistance or children’s health insurance program enrollees and integrates the financing and delivery of health care services.
“Medical or scientific evidence.” Evidence found in any of the following sources:
(1) A peer-reviewed scientific study published in or accepted for publication by a medical journal that meets nationally recognized requirements for scientific manuscripts and which journal submits most of its published articles for review by experts who are not part of the journal’s editorial staff.
(2) Peer-reviewed medical literature, including literature relating to a therapy reviewed and approved by a qualified institutional review board, biomedical compendia and other medical literature that meet the criteria of the National Institutes of Health’s Library of Medicine for indexing in Index Medicus (Medline) and Elsevier Science Limited for indexing in Excerpta Medica (EMBASE).
(3) A medical journal recognized by the Secretary of Health and Human Services under section 1861(t)(2) of the Social Security Act (49 Stat. 620, 42 U.S.C. § 1395x(t)(2)).
(4) One of the following standard reference compendia:
(i) The American Hospital Formulary Service-Drug Information.
(ii) DRUGDEX Information System.
(iii) The American Dental Association Accepted Dental Therapeutics.
(iv) The United States Pharmacopoeia-Drug Information.
(5) Findings, studies or research conducted by or under the auspices of a United States government agency or nationally recognized Federal research institute, including:
(i) The United States Agency for Healthcare Research and Quality.
(ii) The National Institutes of Health.
(iii) The National Cancer Institute.
(iv) The National Academy of Sciences.
(v) The United States Department of Health and Human Services.
(vi) The Food and Drug Administration.
(vii) Any national board recognized by the National Institutes of Health for the purpose of evaluating the medical value of health care services.
(6) Other medical or scientific evidence that is comparable to the sources specified in paragraphs (1), (2), (3), (4) and (5).
“Medical policy.” A written document adopted, maintained and applied by an insurer or MA or CHIP managed care plan that combines the clinical review criteria and any additional administrative policy, as applicable, necessary to articulate the insurer’s or MA or CHIP managed care plan’s standards for coverage of a given health care service or set of health care services under the terms of a health insurance policy or an agreement with the Department of Human Services.
“Medication-assisted treatment.” The use of United States Food and Drug Administration-approved medications along with treatment other than medication, as clinically indicated, to treat substance use disorders, including opioid use disorders.
“NAIC.” The National Association of Insurance Commissioners.
“Nationally recognized medical standards.” Clinical criteria, practice guidelines and related standards established by national quality and accreditation entities generally recognized in the United States health care industry.
“Participating health care provider.” A health care provider that has entered into a contractual or operating relationship with an insurer or MA or CHIP managed care plan to participate in one or more designated networks of the insurer or MA or CHIP managed care plan and to provide health care services to covered persons or enrollees under the terms of the insurer’s administrative policy or an agreement with the Department of Human Services.
“Plan.” (Def. deleted by amendment).
“Prescription drug.” A drug or biological product, as both of those terms are defined in the act of November 24, 1976 (P.L.1163, No.259), referred to as the Generic Equivalent Drug Law.
“Primary care provider.” A health care provider who, within the scope of the provider’s practice, supervises, coordinates, prescribes or otherwise provides or proposes to provide health care services to a covered person or enrollee, initiates a referral for specialist care and maintains continuity of care for the covered person or enrollee.
“Prior authorization.” A prospective utilization review performed by an insurer or MA or CHIP managed care plan, or by a utilization review entity acting on behalf of an insurer or MA or CHIP managed care plan, of all reasonably necessary supporting information that occurs prior to the delivery or provision of a health care service and results in a decision to approve or deny payment for the health care service. The term includes step therapy and step therapy exception requests.
“Prior authorization request.” A request for prior authorization of a health care service that meets an insurer’s or MA or CHIP managed care plan’s administrative policy requirements for such a request.
“Prospective utilization review.” (Def. deleted by amendment).
“Protected health information.” Information or data, whether oral or recorded in any form or medium, and personal facts or information about events or relationships that identifies an individual who is the subject of the information or for which there is a reasonable basis to believe that the information could be used to identify an individual, that relates to any of the following:
(1) The past, present or future physical, mental or behavioral health or condition of an individual or a member of the individual’s family.
(2) The provision of health care services to an individual.
(3) payment for the provision of health care services to an individual.
“Provider network.” Participating health care providers designated by an insurer or MA or CHIP managed care plan to provide health care services under a health insurance policy or an agreement with the Department of Human Services.
“Provider portal.” A designated section or functional software module accessible via an insurer’s or MA or CHIP managed care plan’s publicly accessible Internet website that facilitates health care provider submission of electronic prior authorization requests.
“Referral.” A prior authorization from an insurer, MA or CHIP managed care plan or a participating health care provider that allows a covered person or enrollee to have one or more appointments with a health care provider for a health care service.
“Retrospective utilization review.” Review of medical necessity performed by an insurer or MA or CHIP managed care plan, or by a utilization review entity acting on behalf of an insurer or MA or CHIP managed care plan, and conducted after health care services have been provided to a covered person or enrollee.
“Service area.” The geographic area for which an insurer or MA or CHIP managed care plan is licensed or has been issued a certificate of authority.
“Specialist.” A health care provider whose practice is not limited to primary health care services and who has additional postgraduate or specialized training, has board certification or practices in a licensed specialized area of health care. The term includes a health care provider who is not classified by an insurer or MA or CHIP managed care plan solely as a primary care provider.
“Step therapy.” A course of treatment in which certain designated drugs or treatment protocols must be either contraindicated, or used and found to be ineffective, prior to approval of coverage of other designated drugs or treatment protocols. The term does not include requests for coverage of nonformulary drugs.
“Urgent health care service.” A covered health care service subject to prior authorization that is delivered on an expedited basis for the treatment of an acute condition with symptoms of sufficient severity pursuant to a determination by a licensed treating physician, operating with the individual’s scope of practice and professional expertise, that the failure to provide the service is likely to result in serious, long-term health complications or a material deterioration in the covered person’s or enrollee’s condition and prognosis.
“Utilization review.” A set of formal techniques designed to monitor the use of or evaluate the medical necessity, appropriateness, efficacy or efficiency of health care services, procedures or settings, including prior authorization, second opinion, certification, concurrent review, case management, discharge planning or retrospective review, in order to make a determination regarding coverage of the service under the terms of a health insurance policy or an agreement with the Department of Human Services.
(1) ((1) deleted by amendment).
(2) ((2) deleted by amendment).
“Utilization review entity.” Any entity certified pursuant to subdivision (h) that performs utilization review on behalf of an insurer or MA or CHIP managed care plan.
Step Therapy Override
Section 2156. Step therapy considerations.
(a) Step therapy criteria. If an insurer or MA or CHIP managed care plan has a medical policy that includes step therapy criteria for a prescription drug, the following apply:
(1) An insurer or MA or CHIP managed care plan shall consider as part of the insurer’s or MA or CHIP managed care plan’s prior authorization process a request for an exception to the insurer’s or MA or CHIP managed care plan’s step therapy criteria.
(2) A request for an exception to an insurer’s or MA or CHIP managed care plan’s step therapy criteria shall be based on the covered person’s or enrollee’s individualized clinical condition, and consider at least all of the following:
(i) contraindications, including adverse reactions.
(ii) clinical effectiveness or ineffectiveness of each required prerequisite prescription drug or therapy.
(iii) past clinical outcome of each required prerequisite prescription drug or therapy.
(iv) the expected clinical outcomes of the requested prescription drug prescribed by the covered person’s or enrollee’s health care provider.
(v) for covered persons or enrollees who previously received health care coverage from another entity, whether the covered person or enrollee has already satisfied a step therapy protocol with their previous insurer or MA or CHIP managed care plan that required trials of prescription drugs from each of the classes that are required by the current insurer’s or MA or CHIP managed care plan’s step therapy protocol.
(b) Applicability. The standards and time lines specified in section 2155 shall apply to a review of a request for a step therapy exception.