Final Report. UCare Minnesota 2005

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1 Minnesota Department of Health Compliance Monitoring Division Managed Care Systems Section Final Report UCare Minnesota 2005 Quality Assurance Examination For the period May 1, 2002 through February 28, 2005 Examiners: Susan Margot, M.A. Mary Ann Fena, J.D.

2 Minnesota Department of Health Executive Summary The Minnesota Department of Health (MDH) conducted a Quality Assurance Examination of UCare Minnesota to determine if it is operating in accordance with Minnesota law. UCare fully complied with Minnesota Statutes and Rules of the Quality Assurance Examination, except in the areas outlined as deficiencies in this report. We also identified a number of practices that could be improved which are outlined as recommendations. To address deficiencies, UCare and its delegates must: 1. Develop and implement review and reporting practices that accurately reflect the performance standards expected for delegated functions. 2. Revise its procedure, CLS01, to ensure that the written procedure reflects UCare s actual practices. 3. Ensure that any initial utilization determination is communicated in writing to the enrollee and provider within 10 working days. 4. Ensure that an appropriate audit trail is maintained in utilization review records, whether UCare or its delegates make determinations. 5. Develop and implement procedures that ensure that providers are notified by telephone within one working day of the determination not to certify and that an audit trail of determinations and notifications is kept, whether UCare or its delegate make the determination. 6. Ensure that enrollee and provider notices (DTRs) include appropriate reason codes for a denial, reduction or termination of a service. This report, including the deficiencies and recommendations, is approved and adopted by the Minnesota Commissioner of Health pursuant to authority in Minnesota Statutes, chapter 62D. David J. Giese, Director Compliance Monitoring Division Date 2

3 I. Introduction... 4 II. Quality Program Administration... 4 Minnesota Rules, Part Program...4 Minnesota Rules, Part Activities...5 Minnesota Rules, Part Quality Evaluation Steps...5 Minnesota Rules, Part Focused Study Steps...6 Minnesota Rules, Part Filed Written Plan and Work Plan...6 III. Complaints... 6 Minnesota Statutes, Section 62Q.69. Complaint Resolution...6 Minnesota Statutes, Section 62Q.70. Appeal of the Complaint Decision...6 Minnesota Statutes, Section 62Q.71. Notice to Enrollees...7 Minnesota Rules, Part Records of Complaints...7 IV. Access and Availability... 7 Minnesota Statutes, Section 62D.124. Geographic Accessibility...7 Minnesota Rules, Part Availability and Accessibility...7 Minnesota Statutes, Section 62Q.55. Emergency Services...7 Minnesota Statutes, Section 62Q.121. Licensure of Medical Directors...7 Minnesota Statutes, Section 62Q.14. Open Access to Family Planning...7 Minnesota Statutes, Section 62A.15. General Services (Equal Access to Chiropractic, Optometric, and Nursing Services)...8 Minnesota Statutes, Section 62Q.52. Direct Access to Obstetric and Gynecologic Services...8 Minnesota Statutes, 62Q.527. Coverage of Nonformulary Drugs for Mental Illness and Emotional Disturbance...8 Minnesota Statutes, Section 62Q.535. Coverage for Court-Ordered Mental Health Services...8 Minnesota Statutes, Section 62Q.56. Continuity of Care...8 Minnesota Statutes, Section 62Q.58. Access to Specialty Care...9 Minnesota Rules, Comprehensive Health Maintenance Services...9 V. Utilization Review... 9 Minnesota Statutes, Section 62M.04. Standards for Utilization Review Performance...9 Minnesota Statutes, Section 62M.05. Procedures for Review Determination...9 Minnesota Statutes, Section 62M.06. Appeals of Determinations not to Certify...11 Minnesota Statutes, Section 62M.08. Confidentiality...11 Minnesota Statutes, Section 62M.09. Staff and Program Qualifications...11 Minnesota Statutes, Section 62M.11. Complaints to Commerce or Health...12 Minnesota Statutes, Section 62M.12. Prohibition on Inappropriate Incentives...12 Minnesota Statutes, Section 62D.12. Prohibited Practices...12 VI. Participating Entity Interviews VII. Recommendations VIII. Deficiencies

4 I. Introduction A. History: The Department of Family Practice and Community Health at the University of Minnesota Medical School organized UCare Minnesota in As a demonstration project, UCare served public program enrollees in Hennepin County. UCare was certified as an HMO in In addition to Prepaid Medical Assistance (PMAP) and General Assistance Medical Care (PGAMC) programs, UCare participates in MinnesotaCare, the state-subsidized health insurance plan, created in 1996, and in Minnesota Senior Health Options (MSHO) and Minnesota Disability Health Options (MnDHO) programs. UCare also offers Medicare+Choice (Advantage) products under UCare for Seniors and a Medicare supplement under UCare SeniorSelect. Finally, UCare provides third party administrative services to South Country Health Alliance, a county-based purchasing entity serving public program enrollees in greater Minnesota. UCare recently expanded its enrollment throughout the State of Minnesota, serving 112,547 enrollees in 78 counties. B. Membership: 2004 Enrollment Fully insured Commercial 0 Prepaid Medical Assistance 56,118 Program General Assistance Medical Care 4,602 MinnesotaCare 21,693 Medicare + Choice 27,122 Minnesota Senior Health Options 2,637 Minnesota Disability Health 375 Options Total 112,547 C. Onsite Examination Dates: May 2 through May 13, 2005 D. Examination Period: May 1, 2002 through February 28, 2005 II. Quality Program Administration Minnesota Rules, Part Program Subp. 1. Written Quality Assurance Plan Subp. 2. Documentation of Responsibility Subp. 3. Appointed Entity Subp. 4. Physician Participation Subp. 5. Staff Resources Subp. 6. Delegated Activities Subp. 7. Information System Subp. 8. Program Evaluation Subp. 9. Complaints 4

5 Subp. 10. Utilization Review Subp. 11. Provider Selection and Credentialing Subp. 12. Qualifications Subp. 13. Medical Records Subpart 2. Minnesota Rules, part , subpart 2, mandates that quality assurance authority, functions and responsibility must be delineated in specific documents, such as bylaws and board resolutions. UCare states that the governing board is ultimately responsible for the quality of care provided to its enrollees in its State of Quality Report, which is reviewed and approved by the UCare Board of Directors. However, UCare was unable to produce this statement in bylaws or other Board-generated document or resolution. (Recommendation #1) Subpart 6. Minnesota Rules, part , subpart 6, mandates that an HMO retain responsibility for performance of all delegated activities and requires that HMOs must develop and implement review and reporting requirements to ensure that the delegate performs the delegated activities as required. UCare maintains an annual audit schedule of delegated entities, coordinated by staff of Provider Network Management. Representatives of each UCare department whose functions are delegated to that entity perform the audit. Review of oversight tools and reports indicated that the audit tools were not consistent in format or content across delegated entities, although delegated functions were the same or similar. The audit tool(s) for utilization review did not include many elements of Minnesota Statutes, chapter 62M that were delegated. In addition, MDH noted that staff of one delegate performed part of the annual oversight audit. Oversight reports to the delegate were disjointed. UCare s review and reporting practices do not ensure consistent oversight of delegated activities. (Deficiency #1) UCare prepared and presented corrective action plans (CAPs) to the delegate. Typically, the delegate develops the corrective action plan and provides the CAP to the health plan. The CAP serves as assurance that the delegate understands issues. (Recommendation #2) Minnesota Rules, Part Activities Subp. 1. Ongoing Quality Evaluation Subp. 2. Scope Minnesota Rules, Part Quality Evaluation Steps Subp. 1. Problem Identification Subp. 2. Problem Selection Subp. 3. Corrective Action Subp. 4. Evaluation of Corrective Action 5

6 Minnesota Rules, Part Focused Study Steps Subp. 1. Focused Studies Subp. 2. Topic Identification and Selection Subp. 3. Study Subp. 4. Corrective Action Subp. 5. Other Studies Minnesota Rules, part requires the HMO to conduct focused studies. MDH reviewed the following studies: MSHO Optimal Medication Management Project (Trio) Access and Availability: Childhood Preventive Visits Post Partum Depression Project Minnesota Rules, Part Filed Written Plan and Work Plan Subp. 1. Written Plan Subp. 2. Work Plan Subp. 3. Amendments to Plans III. Complaints Minnesota Statutes, Section 62Q.69. Complaint Resolution Subd. 1. Establishment Subd. 2. Procedures for filing a complaint Subd. 3. Notification of Complaint Decisions Minnesota Statutes, Section 62Q.70. Appeal of the Complaint Decision Subd. 1. Establishment Subd. 2. Procedures for Filing an Appeal Subd. 3. Notification of Appeal Decisions 6

7 Minnesota Statutes, Section 62Q.71. Notice to Enrollees yes no Minnesota Rules, Part Records of Complaints Subp. 1. Record Requirements Subp. 2. Log of Complaints IV. Access and Availability Minnesota Statutes, Section 62D.124. Geographic Accessibility Subd. 1. Primary Care; Mental Health Services; General Hospital Services Subd. 2. Other Health Services Subd. 3. Exception Minnesota Rules, Part Availability and Accessibility Subp. 2. Basic Services Subp.5. Coordination of Care Subp. 6. Timely Access to Health Care Services Minnesota Statutes, Section 62Q.55. Emergency Services yes no Minnesota Statutes, Section 62Q.121. Licensure of Medical Directors yes no Minnesota Statutes, Section 62Q.14. Open Access to Family Planning. yes no 7

8 Minnesota Statutes, Section 62A.15. General Services (Equal Access to Chiropractic, Optometric, and Nursing Services) Subd. 2. Chiropractic Services Subd. 3. Optometric Services Subd. 3a. Nursing Services Minnesota Statutes, Section 62Q.52. Direct Access to Obstetric and Gynecologic Services Minnesota Statutes, 62Q.527. Coverage of Nonformulary Drugs for Mental Illness and Emotional Disturbance Subd. 2. Required Coverage for Anti-psychotic Drugs Subd. 3. Continuing Care Subd. 4. Exception to formulary Minnesota Statutes, Section 62Q.535. Coverage for Court-Ordered Mental Health Services Subd. 1. Mental health services Subd. 2. Coverage required Minnesota Statutes, Section 62Q.56. Continuity of Care Subd. 1. Change in health care provider; general notification Subd. 1a. Change in health care provider; termination not for cause. Subd. 1b. Change in health care provider; termination for cause. Subd. 2. Change in health plans Subd. 2a. Limitations Subd. 2b. Request for authorization Subd. 3. Disclosures 8

9 Minnesota Statutes, Section 62Q.58. Access to Specialty Care Subd. 1. Standing Referral Subd. 1a. Mandatory Standing Referral Subd. 2. Coordination of Services Subd. 3. Disclosure Subd. 4 Referral Minnesota Rules, Part Comprehensive Health Maintenance Services Subp. 3. Permissible limitations Subp. 4. Permissible exclusions V. Utilization Review Minnesota Statutes, Section 62M.04. Standards for Utilization Review Performance Subd. 1. Responsibility on Obtaining Certification Subd. 2. Information upon which Utilization Review is Conducted Subd. 3. Data Elements Subd. 4. Additional Information Subd. 5. Sharing of Information Minnesota Statutes, Section 62M.05. Procedures for Review Determination Subd. 1. Written Procedures Subd. 2. Concurrent Review Subd. 3a. Standard Review Determination Subd. 3b. Expedited Review Determination Subd. 4. Failure to Provide Necessary Information MDH reviewed 113 utilization review files. In the file sample, UCare and its delegates performed utilization review. Subd. 1. Minnesota Statutes, section 62M.05, subdivision 1, requires that the health plan have written procedures to ensure that reviews are conducted as required by law. UCare s policy, 9

10 CLS01, stated, Denial of services can only be done by appropriately licensed professionals. Appropriately licensed professionals are defined as... pharmacists. When personnel with the existing expertise cannot adequately review the service under review, then a board-certified professional can be consulted per UCare Policy QM13, Health Care Reviewer Selection and Performance Guidelines. The UCare policy reflects NCQA requirements, but does not clearly identify the role of health care professionals other than physicians. Minnesota Statutes, section 62M.09, subdivision 3, requires that a physician must review all cases where the plan determines not to certify for clinical reasons. A pharmacist may deny a request based on a benefit determination (e.g., no step therapy was performed), but may not deny a request based on a clinical reason. File review and interviews did not identify any instances where a professional other than a physician made a denial determination. (Deficiency #2) Subd. 3a(a). Minnesota Statutes, section 62M.05, subdivision 3a(a), requires the initial utilization review determination must be communicated in writing to the provider and enrollee within ten working days (15 calendar days). MDH found that 30 of 113 denials reviewed were not completed within 15 calendar days. These included determinations by UCare and by its delegates. 23 UCare (4 PCA and 5 providers didn t send requested information) 3 Doral 1 AXIS (1 PCA) 1 MMSI 2 EverCare 30 Total (Deficiency #3) Subd. 3a(b). Minnesota Statutes, section 62M.05, subdivision 3a(b), requires that the health plan provide prompt telephone notification of an initial determination and written notification or an audit trail of the determination and telephone notification. Review of utilization review files indicates that UCare staff maintains an appropriate audit trail. AXIS HealthCare provides unique care coordination and utilization management functions to UCare enrollees with disabilities. Review of AXIS HealthCare s electronic files indicated that the documentation system and notes focused on care coordination and did not adequately document utilization review functions, including determination procedures, determination dates, dates of telephone notification, reviewer name, etc. In addition, the Medical Director does not enter notes into the AXIS electronic system. Determinations and determination dates could only be surmised from care coordinator notes. As a result, AXIS records did not maintain an appropriate audit trail of utilization review functions. (Deficiency #4) Subd. 3a(c). Minnesota Statutes, section 62M.05, subdivision 3a(c), requires that both the attending healthcare professional and hospital are notified of a denial by telephone within one working day of the determination. The enrollee and providers must also be notified in writing. 10

11 Twenty-four of the 113 utilization review files did not document oral notice to the provider or didn t document the telephone notice within one working day. 10 UCare reviewed files 3 Caremark 1 MMSI 1 Doral 5 EverCare 4 AXIS 24 Total (Deficiency #5) Subd. 3b. None of the 113 sampled files requested expedited review. Subd. 4. Minnesota Statutes, section 62M.05, subdivision 4, requires the HMO to have written procedures that address the failure of the provider or enrollee to provide the necessary information for a review. MDH found that eight of the 30 utilization denials exceeding 15 calendar days for review were due to requests for additional information that were not forthcoming. Staff interviews indicated that UCare s practice changed. Staff now call the provider daily for three consecutive days, then deny the request. The written procedure has not been updated to reflect this practice. (Recommendation #3) Minnesota Statutes, Section 62M.06. Appeals of Determinations not to Certify Subd. 1. Procedures for Appeal Subd. 2. Expedited Appeal Subd. 3. Standard Appeal Subd. 4. Notifications to Claims Administrator All UCare appeals are sent to the Grievance and Appeal department. If a medical determination is required, the appeal is sent to Clinical Services for review and returned to the Grievance and Appeals section for the response letters. Except for dental-related determinations, UCare does not delegate appeal review. MDH found that handling of appeals was exemplary. (Also see Minnesota Statutes, section 62Q.70 above.) Minnesota Statutes, Section 62M.08. Confidentiality Document review confirms UCare meets the requirements of law. yes no Minnesota Statutes, Section 62M.09. Staff and Program Qualifications Subd. 1. Staff Criteria Subd. 2. Licensure Requirement Subd. 3. Physician Reviewer Involvement Subd. 3a. Mental Health and Substance Abuse Review 11

12 Subd. 4. Dentist Plan Reviews Subd. 4a. Chiropractic Reviews Subd. 5. Written Clinical Criteria Subd. 6. Physician Consultants Subd. 7. Training for Program Staff Subd. 8. Quality Assessment Program Subd. 8. Minnesota Statutes, section 62M.09, subdivision 8, states the plan must have written documentation of an active quality assessment program. Interviews and quality reports indicate that UCare Medical Directors regularly review files for inter-rater reliability. Clinical Services nurses have not performed inter-rater reliability testing because for at least one year of the exam period, UCare had only one utilization review nurse. Utilization review is now fully staffed, but has not instituted inter-rater reliability for the nurses. (Recommendation #4) Minnesota Statutes, Section 62M.11. Complaints to Commerce or Health Document review confirms UCare meets the requirements of law. Minnesota Statutes, Section 62M.12. Prohibition on Inappropriate Incentives Interviews confirm UCare meets the requirements of law. Minnesota Statutes, Section 62D.12. Prohibited Practices Subd. 19. Coverage of Service Minnesota Statutes, section 62D.12, subdivision 19, requires that an HMO may not deny coverage for a service solely for a lack of prior authorization, if the service would be covered if the service had been prior authorized. (DHS-approved reason codes included no prior authorization until April However, the Minnesota statute was in effect prior to this examination period.) Three of ten Caremark files reviewed showed denial reasons of no prior authorization. File review showed that appropriate utilization review determinations were performed for each of the cases. Consequently, it appears that an inappropriate denial reason code was repeatedly chosen. The inaccurate reason code may preclude the enrollee and provider from filing an effective appeal. (Deficiency #6) VI. Participating Entity Interviews MDH examiners visited two UCare Minnesota care systems and interviewed four additional providers by telephone. 12

13 VII. Recommendations 1. To better comply with Minnesota Rules, part , subpart 2, UCare should document that the governing board accepts ultimate responsibility for the quality of care provided to its enrollees in a board-generated document or board resolution. 2. To better comply with Minnesota Rules, part , subpart 6, UCare should revise its internal policies to indicate that delegates are responsible for creating corrective action plans. 3. To better comply with Minnesota Statutes, section 62M.05, subdivision 4, UCare should revise its written procedures regarding failure to provide information necessary to make a determination. 4. To better comply with Minnesota Statutes, section 62M.09, subdivision 8, UCare should institute inter-rater reliability testing among its nurse reviewers. VIII. Deficiencies 1. To comply with Minnesota Rules, part , subpart 6, UCare must develop and implement review and reporting practices that accurately reflect the performance standards expected for delegated functions. 2. To comply with Minnesota Statutes, section 62M.05, subdivision 1, UCare must revise its procedure, CLS01, to ensure that the written procedure reflects UCare s actual practices. 3. To comply with Minnesota Statutes, section 62M.05, subdivision 3a(a), ensure that any initial utilization determination is communicated in a written notice (DTR) to the enrollee and provider within 10 working days. 4. To comply with Minnesota Statutes, section 62M.05, subdivision 3a(b), UCare must ensure that an appropriate audit trail is maintained in utilization review records, whether UCare or its delegates makes the determination. 5. To comply with Minnesota Statutes, section 62M.05, subdivision 3a(c), UCare must develop and implement procedures that ensure that providers are notified by telephone within one working day of the determination not to certify and that an audit trail of determinations and notifications is kept, whether UCare or its delegate makes the determination. 6. To comply with Minnesota Statutes, section 62D.12, subdivision 19, UCare must ensure that enrollee and provider notices include appropriate reason codes for a denial, reduction or termination of a service. 13

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