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Heads Up - Changes Coming in Fair Hearing Rights for MLTC and Managed Care Members - March 2018

20 Nov, 2017

New York State is preparing to implement massive changes in appeal rights for members of Medicaid managed care plans, including members of Managed Long Term Care plans.  These are changes in federal Medicaid regulations governing Medicaid managed care plans, which were made by the Obama Administration.  The managed care regulations are at 42 C.F.R. Part 438,  Subpart F  -- The Grievance and Appeal System for Medicaid managed care.  The regulations are effective in New York State on April 1, 2018, but NYS Dept.of Health has stated it intends to put them in effect on March 1, 2018.    This article explains the appeal procedures as they exist now, before these changes go into effect. 

Here are the key changes that will go into effect March 1, 2018:

Members Must Request Internal Appeals within their Plan, and Plan must Deny the Appeal, Before Requesting a Fair Hearing ("Exhaustion" requirement)

The biggest change for New York managed care members is the "Exhaustion" requirement.    Under 42 C.F.R. 438.402(c)

"...An enrollee may request a State fair hearing after receiving notice under § 438.408 that the adverse benefit determination is upheld."

Section 438.408 refers to the plan's decision resolving a request for an internal appeal.  

This new requirement that members first appeal a plan's adverse decision to the plan BEFORE requesting a fair hearing is a huge change in New York.   In the nearly twenty years that enrollment in managed care has gradually become  mandatory for most Medicaid recipients who do not have Medicare, members always have had the right to request a fair hearing without first requesting an internal plan appeal.   When Managed Long Term Care first became mandatory in 2012, "exhaustion" of internal appeals was required, but since July 1, 2015, the State dropped that requirement, entitling MLTC members to request a fair hearing right away to contest an adverse determination by the plan.  See this article about current appeal system in MLTC and this news article describing the elimination of the "exhaustion" requirement for MLTC in July 2015. 

To prepare for implementation of this massive change, the State Dept. of Health has convened a Workgroup composed of both plan and consumer representatives.   NYLAG Evelyn Frank Legal Resources Program, along with the ICAN Ombudsprogram, the Legal Aid Society, and Empire Justice Center are representing consumer interests in this workgroup.  Among the concerns expressed by consumers are the following:


If a managed care or MLTC plan sends notice that it intends to reduce  hours of home care services, or reduce or stop any other service, the member will now have to request an INTERNAL PLAN APPEAL within the short 10-day window needed to secure AID CONTINUING -- continuation of services at the original current amount, without the proposed reduction going into effect.   The plan only has to mail the notice 10 days before the effective date of the intended action.  The member must request the internal appeal before the effective date of the action  The 10 days includes the time it takes to mail the notice and includes weekends and holidays.   This may leave only a workday or two to request the appeal. All of the concerns listed below jeopardize aid continuing rights and appeal rights generally.  

2.   Requesting an internal plan appeal within this 10-day time frame may be more difficult than requesting a Fair Hearing. 

For fair hearings, members have the option of requesting the hearing by phone, fax, or online.  Fair Hearing phone requests are to a line dedicated solely to fair hearing requests.  In contrast. members call an 800 number for the managed care plans that handles ALL managed care issues, not just appeals.  Members may be routed by the call center to their care manager, or to other departments, rather than to the Grievances and Appeals unit.  Time is of the essence to get that internal appeal request logged in, but time may be lost while the call is routed or misrouted, or while the member awaits a call back.  The State Dept. of Health has agreed to consumers' requests that plan notices provide a fax number to fax an internal appeal request.  They are not required, however, to allow filing requests online.

3.  Plan notices must clearly explain the new requirement to file an internal appeal.  

The State has solicited comments on draft model notices, which NYLAG and other consumer representatives have submitted proposed edits.  The final notices will be posted when available.   

4.  Oral Appeals Must be Followed up by a Written Signed appeal request, unless the enrollee requests an expedited resolution  

The regulations require this extra step for requests made orally, presumably by phone.  42 § 438.402(c)(3)(ii).  The exception is if expedited resolution is requested.   As an advocacy tip,  any oral request should request expedited resolution.    Expedited resolution is required if the plan determines or medical provider indicates that "...taking the time for a standard resolution could seriously jeopardize the enrollee's life, physical or mental health, or ability to attain, maintain, or regain maximum function."  42 C.F.R. 438.410.  Expedited determinations must be made within 72 hours rather 30 days for standard appeals.   42 C.F.R. 438.408.  

Consumers have urged DOH to require plans to assist members with providing the written appeal confirmation.  

5.  Who May Request The Internal Appeal On Behalf of the Member

The federal regulation says,  "If State law permits and with the written consent of the enrollee, a provider or an authorized representative may request an appeal or file a grievance, or request a State fair hearing, on behalf of an enrollee."    § 438.402(c)(1)(ii).   This language would seem to require the member to give written consent for every appeal request filed by a representative.    However, in  the preamble to the regulations, CMS states,   “…we defer to state determinations regarding the design of their grievance and appeal system; state law could vary regarding who the state recognizes as an authorized representative.”  81 Fed. Reg. at 27510.  New York has always been expansive in permitting family or representatives to request the appeal, thus ensuring that the right to appeal is not unduly restricted.  For example, the OTDA  fair hearing request form allows a person requesting the hearing to  indicate whether  they are the “requester” or the “representative.”  NYS DOH's templates for model MLTC notices issued  In March 2015  state, “You can have someone you trust ask for an Internal Appeal for you.”  The State should take an expansive approach in allowing representatives to request appeals for members --  especially where Aid Continuing rights are at issue.

6.  "DEEMED EXHAUSTION" - Member May Request a Fair Hearing if Plan Failed to Meet Notice and Timing Requirements

The regulations provide for an exception to the "exhaustion" requirement.  Where the managed care plan “fails to adhere to the notice and timing requirements of sec. 438.408, the enrollee is deemed to have exhausted the [managed care plan'] … appeals process.  The enrollee may initiate a State fair hearing.”  42 438.402(c)(1)(A).

This regulation requires state policies for defining where deemed exhaustion applies.  Both state agencies -- OTDA and DOH  - must revise their procedures and forms elicit facts that demonstrate whether deemed exhaustion applies. 

Consumers contend that deemed exhaustion should be defined to apply in cases including but not limited to:

  • No written notice of initial adverse determination (IAD) was provided by the plan, or
  • The IAD does not include the requisite information re the right to Aid Continuing, how to request an appeal, etc.
  • The IAD did not incorporate necessary translation or alternative formats, was not on the required template, or did not offer auxiliary aids and services, free of cost, during the appeal, thus impeding the enrollee’s time to appeal or request Aid Continuing.
  • The IAD  does not comply with other applicable requirements, ie. MLTC Policy 16.06;
  • Plan did not decide the appeal  within 30 days from member’s appeal request, or if an expedited appeal was requested, within 72 hours after the MCO receives the appeal, unless extended pursuant to the regulations by up to 14 calendar days.  § 438.408

Stay turned for more information about these changes.  

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