You can improve the care you receive by understanding managed care and how it works, being proactive in your health care, and establishing positive relationships with your providers. Managed care is a generic term that applies to different types of health care insurance arrangements. The goal of a managed care system is to provide members with needed health care services at the lowest possible cost. Some managed care plans also focus on prevention, trying to keep members healthy. In some managed care arrangements, members must seek care from within the health plan’s network of providers. In other arrangements, members can obtain services from any provider, but the health plan will pay more of the bill if the patient obtains care from a network provider.

Two components of a managed care plan are systems that oversee the amount and type of health care services being used ("utilization review") and provider reimbursement methods that discourage unnecessary care. Managed care organizations often require members to get approval before obtaining certain services. Some managed care organizations also give providers financial incentives to eliminate unnecessary care. Some of the most common managed care arrangements are:

• Preferred Provider Organizations (PPOs): PPOs seek to manage medical costs by contracting with a network of providers who are willing to accept lower reimbursement rates. These providers often must also meet other requirements, such as utilization review. Members can choose any health care provider but members will have to pay additional money if they use a provider who is not part of the PPO network. PPOs are frequently used by traditional insurance companies.
• Health Maintenance Organizations (HMOs): HMOs have exclusive provider networks. They may also use any primary care providers (PCP) as gatekeepers. Gatekeepers are responsible for arranging a patient’s referral to a specialist or admission to a hospital. While most HMOs use gatekeepers, some HMOs have open access plans. These plans allow the patient to choose any PCP or specialist in the network without a referral. Many HMOs also use reimbursement systems to encourage providers to be more cost conscious.
• Point-of-Service (POS): POS plans give members the opportunity to see providers outside the network. Members who use a provider in the HMO’s network pay less than members who see providers outside the network. The HMO may still require the use of a gatekeeper to authorize in-network services, but no referral is needed for out-of-network services.

The following are ten tips about how to become a more proactive and knowledgeable health care consumer:

1. Find out what services your health plan covers

Check to see what services are covered or excluded under the plan. Your Evidence of Coverage or Policy Contract describes the services that are covered or excluded in your plan. You should receive a copy of the Evidence of Coverage when you enroll or your employer enrolls you in the HMO. Similarly, you should receive a copy of a policy contract if you enroll in a traditional health insurance plan or PPO. These documents provide information on:


• Covered services, including any limitations;
• Excluded services ;
• Cost sharing or coverage differences for in- and out-of-network services;
• Total payment for health services that the member must pay (for example, out-of-pocket maximums);
• Reference information available to members and prospective members upon request;
• Definition of medical necessity;
• How to request pre-authorization for services and the toll-free number to call for pre-authorization;
• Coverage that is available for out-of-network services;
• The health plan’s method for resolving member complaints;
• Appeal and grievance procedures;
• Reasons, if any, that an HMO can terminate a member’s enrollment.

It is very important to read these materials carefully and to keep a copy so you can look at the materials when you have questions. Your health plan is required to send you another copy of your Evidence of Coverage or policy contract if you cannot find your original copy.

You can also obtain more information about how the health plan will treat a specific health condition. Specifically, you need to ask the health plan for the "clinical protocols" or "utilization review" criteria it uses to decide what services will be covered to treat your health condition. These are the guidelines a managed care plan uses in deciding whether a person with your condition should receive certain health care services or treatments. These will help you anticipate how a particular condition may be treated by the managed care plan as well as assist you with an appeal and/or grievance. Managed care plans are required upon request to give you a copy of their clinical protocols or utilization review criteria. If you don’t understand what it means, ask a health care professional whom you trust to help you decide if the guidelines are adequate to meet your health care needs.

If you use particular medications, you should also ask the health plan for a copy of their formulary. The formulary is the list of prescription medications that the health plan will cover. See whether your medication is on the health plan’s formulary. If not, ask the health plan how to request an exemption from the formulary.

2. Take advantage of the health plan’s coverage of preventive services

Under state law, health plans of all types are required to cover certain clinical screenings and preventive services, such as pap smears, mammograms, bone mass screenings, PSAs (prostate examinations), and diabetes outpatient self-management training. Most HMOs and some other health plans offer coverage of preventive health services, such as annual physicals or well-child services. Health plans sometimes offer other wellness services or programs to manage chronic diseases. You should take advantage of this coverage. Seeking preventive services on a regular basis can help ensure that problems are identified early, which can improve your health outcomes.

 

3. Understand how your health plan works

Learn how your specific health plan works. For example:

• Are you required to obtain care from a network provider, or can you obtain care from a non-network provider? Typically, HMOs require you to obtain care from a provider in the HMO's network. PPOs or POS plans let you obtain care from a non-network provider, but generally with a deductible or higher copayments.
• Does your health plan require that you obtain a referral from your primary care provider before seeking care from a specialist? Many HMOs require that you obtain a referral from your primary care provider before seeing a specialist. If so, you need to understand this process. However, some HMOs allow you to obtain care from any network provider (called "open access" plans). Some PPOs also require a referral.
• Does your health plan require that you obtain prior approval or precertification before obtaining certain services? Most health plans require members or their providers to obtain prior approval from the health plan before the plan will cover certain high-cost services. For example, the health plan may require prior approval for non-emergency hospitalizations or use of certain diagnostic equipment. Find out when prior authorization is required to ensure that the health plan covers the costs of these services.
• Who are the participating providers? Can you pick your provider or are there any limits in your choices? Find out if your physician is part of the HMO or managed care network. You should also check to see what specialists, hospitals, specialized treatment centers and other practitioners are included in the network. Sometimes your choice of a particular primary care provider will limit your choice of specialists to those that practice in the same medical group. Read your provider directory carefully. This is especially important if you have chronic or special health problems.
• What are the cost sharing arrangements under the plan? Most plans require members to pay some of the costs of health care services. You need to know what costs you will be expected to pay, and when payment is due.

  Your Evidence of Coverage or policy contract should contain information to help you understand how your plan works. Carefully review these materials and keep copies of these materials for future reference.

  You should also notify your health plan of any changes that will affect your coverage such as marriage, birth or adoption of a child, death of a covered dependent, or coverage under another health plan. You should also let your health plan know if you move or change telephone numbers, so that you can continue to receive information from the health plan.

4. Be aware of the cost sharing mechanisms used by your plan

Most health plans have some cost sharing requirements for members. These cost sharing arrangements generally fall into three categories: deductibles, coinsurance and copayments. A deductible is the amount the member must pay out-of-pocket each year before the insurance plan begins to cover health care costs. Coinsurance is the percentage of a provider’s fee that the patient is expected to pay. For example, a health plan may require the patient to pay 20%–which means the health plan pays 80% of the provider’s fee and the patient is responsible for the remaining 20%. A copayment is a fixed payment that must be paid out-of-pocket by the member upon receiving health care services. Traditional insurance companies generally use deductibles and coinsurance as their cost sharing methods, whereas, HMOs usually rely on copayments. Sometimes, health plans have different cost sharing requirements depending on whether you see a network provider or a provider that is not part of the health plan’s network. Before you schedule any services, make sure that you understand the costs you may be required to pay and when payment is required. In some instances, a provider can refuse to treat you unless you pay the necessary charges.

Health plans sometimes establish out-of-pocket maximums that may limit the amount an individual has to pay for medical services in a given year. Once this limit is met, the health plan will pay 100 percent of the costs of future covered health services until the new policy year begins. However, a health plan may specifically exclude certain costs from the out-of-pocket maximum. For example, you may not be able to count the costs of non-covered services that you incur, or any costs incurred by failing to follow the health plan’s prior approval process.

In addition, many health plans have annual or lifetime limits for certain services. Annual limits are the maximum amount of money that the insurer or plan will pay for a member’s health care services in a given year. The insurer can have an annual limit for all health care services, or may have separate annual limits for specific services (for example, prescription drugs or durable medical equipment). Some insurers also have a lifetime limit, which is the maximum amount of money the insurer or plan will pay during the lifetime of a particular member. The health plan can stop paying for any services (or the specified services) once you reach the annual or lifetime limit, because your coverage for the services has been exhausted.

5. Follow your health plan’s referral and prior authorization process.

You need to understand and follow your health plan’s referral and prior authorization process. For example, some HMOs require that you obtain a referral from your primary care provider before obtaining specialist services. If you are in this type of plan, you must obtain a referral or the HMO will not pay for the services.

Find out what services your referral covers. People sometimes have problems with their HMO because the referral did not cover all the services that they received. For example, a member may obtain a referral to a specialist and assume that all the diagnostic tests that the specialist orders will be automatically covered. However, some health plans require an additional referral from the primary care provider or prior authorization from the health plan before covering certain high-cost procedures. Other problems can arise when a person is referred to a specialist for on-going care. Some PCPs or HMOs limit the number of visits or length of time covered by a referral. You need to understand what the referral covers, and to contact your primary care provider if an additional referral is needed.

Health plans must have procedures to allow patients with chronic, degenerative, disabling or life-threatening diseases or conditions to obtain standing or extended referrals to in-network specialists. The standing referrals cannot not exceed 12 months, and must be part of a treatment plan coordinated with the primary care physician, specialist and the health plan.

In addition to the PCP referral requirements, most managed care organizations require that certain services be approved in advance by the plan. This is called "prior authorization" or "precertification" and is necessary before the HMO will pay for the service. Each managed care organization has its own rules for which services or procedures require prior authorization. As a general rule, most require that non-emergency hospitalizations, surgery or therapy services need to be approved in advance by the plan. Similarly, many managed care organizations require prior authorization for certain high-technology services, such as MRIs. The health plan should specify which services require prior authorization in your Evidence of Coverage. Your membership card should include a toll-free number to call when you need to get prior approval from the HMO.

Most HMOs place the responsibility of obtaining prior approval on the physicians or health care provider. In these instances, the HMO will deny payment to providers who fail to obtain the necessary approval. Some HMOs prohibit providers from charging patients if the provider failed to get authorization. Other HMOs place the responsibility on the members and allow the physician to charge for services if the member fails to get prior approval. You should always check to make sure that services are authorized.

You need to obtain prior authorization when required. Otherwise, the HMO is not required to pay for the covered services. If you are uncertain about whether you need to get prior authorization, call the HMO.

 

6. Choose a primary care provider and establish a positive working relationship

It is important that you develop a trusting relationship with your provider so that you can discuss all treatment options and preferences. Make sure that the provider is willing to act as your advocate and partner in developing a treatment plan. It is critical that your primary care provider understands your needs and is willing to help you navigate the managed care system. By establishing a positive relationship with your primary care provider early on, you are more likely to avoid later problems.

If your provider is not a participating provider or if you want to choose another provider, you will need to review the health plan’s list of participating providers. The list usually includes the names, addresses and phone numbers of the provider, as well as the provider’s specialty. Even though a physician or group practice may be listed in a provider directory it does not necessarily mean that the physician or practice is accepting new patients. When a physician’s practice is full, he or she may stop taking new patients. Because the health plan’s printed directories can not keep up with changes in provider availability, you should call the physician’s office to see if new patients are being accepted. You should also ask the office how long it usually takes to get an appointment for both immediate needs and for general check-ups. Ask what hours the office is open and how to obtain care after regular office hours.

In order to develop a treatment plan that best meets your needs, you need to keep your providers informed of your health condition and any problems you may be experiencing. Most medical conditions can be treated through a variety of methods. Make sure that you discuss all treatment options with your providers and thoroughly understand the benefits and risks of each procedure. Your providers should explain all treatment options, whether or not your plan will cover them. While your health plan may only provide coverage for certain types of treatments, it is still vital that you understand all your options. Once you understand your treatment options you should work with your providers to develop a treatment plan. Then it is important to follow the treatment plan or to contact your providers if you think its not working.

8. Pursue your appeal rights if you think you are not getting the care you need

You have the right to appeal your health plan’s decision to deny coverage of health care services (called a "noncertification" decision). Most noncertification decisions occur when the health plan does not have enough information about your case. More than half of all appeals of noncertification decisions are decided in favor of the patient, so be aggressive in pursuing your rights! Involve your physician in the appeal process because your physician can more easily explain the reason why you need the service in question.

When a health plan denies payment for services, the plan must send you a noncertification letter explaining why the requested services or procedures were denied. The notice must include the underlying clinical reasons for the noncertification as well as instructions on how to appeal the health plan’s decision. Ask the health plan to give you a copy of the reasons it used in making the decision. This will provide you with a more complete explanation for why the requested treatment, procedure or admission was denied.

If the health plan denies coverage, you may first want to try to resolve the problem informally. Most health plans have an informal review process, where you or your physician can call the health plan to see if the problem can be worked out. This process is voluntary. You do not need to seek an informal resolution of the problem before filing a formal appeal, and you can stop the informal process at anytime and file a formal appeal. However, you may be able to resolve the problem more quickly if your physician calls the health plan and explains the need for the requested services. If you can not resolve the dispute informally, you can file a formal appeal. You, or someone acting on your behalf, can file a formal appeal.

All health plans must offer two levels of appeals.A physician who was not involved in the original decision denying your care must hear the first appeal. Normally, the physician has 30 days to decide the appeal but you can request an expedited appeal if your health would be harmed by the 30-day delay. In an expedited appeal, the physician has up to four days to make a decision if you need a quicker review. You may request that the decision be made immediately if you have a more urgent health care need. If you are still dissatisfied with the HMO’s decision after the first review, you can request a second review, called a second-level grievance hearing.

Second-level appeals are more structured. You have a right at this hearing to:

• Attend the hearing in person;
• Bring someone else to help you with the hearing, such as a family member or attorney;
• Present your own evidence;
• Request information from the health plan in advance of the hearing;
• Question other people at the hearing.

The HMO will convene a hearing panel to listen to second-level grievances. The review panel has up to 45 days to hold the hearing and up to 15 days thereafter to make a decision. However, you can request an expedited second-level review if your health could be harmed because of any delay.

You also have the right to file a grievance any time you are dissatisfied with a health plan’s internal operations. For example, you can file a grievance if you are unhappy with the quality of care or if you believe the network is not adequate. You can file a grievance if the HMO or insurance company fails to reimburse you for certain out-of-pocket payments that should have been covered by the plan. Again, you can try to resolve the problem informally or through a formal grievance. You don’t need to call the health plan before filing a grievance, but you may be able to get your problem solved quicker by calling the health plan first. Health plans must offer two-levels of grievance hearings that operate similarly to the appeal hearings.

Be sure to ask your provider or your health plan, if you have questions regarding your health plan, covered services, treatment options or any other subject related to your health. All health plans have customer service departments to answer your questions about how your health plan works. Many health plans also have nurse triage telephone lines that allow you to ask medical questions or seek health advice. Your primary care provider can also be an important source of information about treatment options and health concerns. The more educated and knowledgeable you are about your health plan and your general health, the more benefit you will gain from your relationship with your health plan.

10. Learn how managed care works and your rights as a managed care enrollee

In addition to the Evidence of Coverage or Policy Contract, there are general materials available to help you understand your rights as a managed care enrollee. The NC Institute of Medicine has published several documents that may be helpful:

• Understanding Managed Care: Answers to Frequently Asked Questions
• Consumer Protections: What Are Your Rights if You Enroll in an HMO?
• Questions You Should Ask Your Managed Care Plan
• People with Disabilities & Chronic Conditions: Questions You Should Ask Your Managed Care Plan
• Managed Care: Internet Resources for the General Population
• Managed Care: Internet Resources for Individuals with Disabilities or Chronic Health Conditions

These documents, as well as information comparing NC HMOs is available through the internet at: www.nciom.hmoconguide.

In addition, the NC Department of Insurance publishes information comparing the performance of NC HMOs:

• Managed Care Plan Handbook: A Comparison Guide for North Carolina Consumers
• HMO Performance Report
• Guide to Appeals and Grievances: Your Rights as a Health Insurance Consumer.

These guides can be ordered from the NC Department of Insurance by calling: 1-800-546-5664 or 1-800-662-7777 or at the website: http://www.ncdoi.com. You can also contact the NC Department of Insurance for assistance if you are having problems with your health plan. NC Department of Insurance has a Consumer Services Division that can help address consumer complaints. The Department can investigate the complaint and will intervene on behalf of the consumer if it thinks the health plan is acting improperly. The Consumer Services Division is open from 8:00 am to 4:50 p.m. Monday through Friday. The Division can be reached at: 1-800-546-5664 or 1-800-662-7777.

REMEMBER, you are your best advocate: be an educated consumer!

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