State Law

Arizona Rev. Statutes-Title 20-Chapter 26-Article 1. General Provisions

07/28/2023 Arizona Section 20-3401

Definitions

Medical Necessity-Definition

See bold text below:

In this article, unless the context otherwise requires:

1. “Adverse determination”:

(a) Means a decision by a health care services plan or its utilization review agent that the health care services furnished or proposed to be furnished to an enrollee are not medically necessary and plan coverage is therefore denied, reduced or terminated.

(b) Does not include a decision to deny, reduce or terminate services that are not covered for reasons other than medical necessity.

2. “Authorization”:

(a) Means a determination by a health care services plan or its utilization review agent that a health care service has been reviewed and, based on the information provided, satisfies the health care services plan’s requirements for medical necessity and appropriateness and that payment under the plan will be made for that health care service.

(b) Does not include any different or additional procedures, services or treatments beyond those specifically reviewed and approved by the health care services plan.

3. “Emergency ambulance services” has the same meaning prescribed in section 20-2801.

4. “Emergency services” has the same meaning prescribed in section 20-2801.

5. “Enrollee” means an individual or a dependent of that individual who is currently enrolled with and covered by a health care services plan. Enrollee includes an enrollee’s legally authorized representative.

6. “Health care service”:

(a) Means a health care procedure, treatment or service that is covered under a health care services plan.

(b) Includes providing a prescription drug, device or durable medical equipment that is covered under a health care services plan.

(c) Does not include treatments that are experimental, investigational or off label.

7. “Health care services plan”:

(a) Means a plan offered by a disability insurer, group disability insurer, blanket disability insurer, health care services organization, hospital service corporation or medical service corporation that contractually agrees to pay or make reimbursements for health care services expenses for one or more individuals residing in this state.

(b) Does not include benefits provided under limited benefit coverage as defined in section 20-1137.

8. “Medically necessary” or “medical necessity”:

(a) Means covered health care services provided by a licensed provider acting within the provider’s scope of practice in this state to prevent or treat disease, disability or other adverse conditions or their progression or to prolong life.

(b) Does not include services that are experimental or investigational or prescriptions that are prescribed off label.

9. “Medication-assisted treatment” has the same meaning prescribed in section 32-3201.01.

10. “Pharmacy benefit manager” has the meaning prescribed in section 20-3321.

11. “Prior authorization requirement”:

(a) Means a practice implemented by a health care services plan or its utilization review agent in which coverage of a health care service is dependent on an enrollee or a provider obtaining approval from the health care services plan before the service is performed, received or prescribed, as applicable.

(b) Includes preadmission review, pretreatment review, prospective review or utilization review procedures conducted by a health care services plan or its utilization review agent before providing a health care service.

(c) Does not include case management or step therapy protocols.

12. “Provider” means a physician, health care institution or other person or entity that is licensed or otherwise authorized to furnish health care services in this state.

13. “Urgent health care service” means a health care service with respect to which the application of the time periods for making a nonexpedited prior authorization decision, in the opinion of a provider with knowledge of the enrollee’s medical condition, could either:

(a) Seriously jeopardize the life or health of the enrollee or the ability of the enrollee to regain maximum function.

(b) Subject the enrollee to severe pain that cannot be adequately managed without the care or treatment that is the subject of the utilization review.

14. “Utilization review agent” has the same meaning prescribed in section 20-2501.

See https://www.azleg.gov/viewdocument/?docName=https://www.azleg.gov/ars/20/03401.htm