Health Assistance Programs:
Role in Grievances, Appeals and Hearings
For Medicaid and SCHIP Beneficiaries
October 2002
Consumer health assistance programs (also called "ombudsman programs") may play an important role in protecting Medicaid and State Children's Health Insurance Program (SCHIP) beneficiaries' right to due process. Depending on how the programs are structured, that role can range from (1) ensuring that consumers know how they can file grievances, appeals, and hearing requests and what the timelines are for filing and what they can expect in each procedure; (2) referring consumers to legal services programs or other resources for representation; (3) helping consumers gather medical records or other evidence and prepare their case; (4) making the ombudsman program's notes about attempts at informal resolution available to the consumer for use as evidence; (5) accompanying the consumer to the appeal procedures or hearing; (6) actually representing the consumer in a grievance, appeal, or fair hearing.
About 20 states have Medicaid health assistance or ombudsman programs. Some programs are run by government agencies, while others are run by nonprofit community organizations. Many of the nonprofit programs have contracts with the state Medicaid agency to provide ombudsman services. About half of all Medicaid health assistance programs nationally represent consumers in formal grievance reviews. The proportion of Medicaid health assistance programs that include an attorney on staff is smaller--about one-fourth.[2]
Federal requirements regarding representation
Under federal law and regulations, when Medicaid or SCHIP beneficiaries or applicants are dissatisfied with decisions concerning their eligibility, enrollment, or health services, the states must have procedures to review the concerns. States also have an obligation to inform SCHIP and Medicaid beneficiaries of the review processes and to ensure them an opportunity to be represented.
For Medicaid beneficiaries and applicants, there are several types of review: (1) Medicaid beneficiaries enrolled in managed care can file "grievances" with their health plans concerning the quality of their care and "appeals" with their health plans concerning the plan's decision to terminate, reduce, or suspend a health service or the plan's failure to provide a service on a timely basis. (2) Medicaid managed care enrollees can also request a "State fair hearing"[3] through the Medicaid agency. The state acts as the external reviewer of the health plan's decision--a hearing officer who is not part of the health plan or paid by the health plan decides the case. Some states require managed care enrollees to exhaust their plans' internal appeal processes before requesting a fair hearing, while other states allow Medicaid beneficiaries to request a fair hearing immediately (42 CFR §438.400 et seq.). (3) Medicaid beneficiaries and applicants can also request a hearing about their eligibility for Medicaid, about services that they believe should have been covered under a Medicaid fee-for-service program, or about a transfer or discharge from a nursing home. In some states, hearings with a local agency precede hearings with the state Medicaid agency.
Medicaid regulations (42 CFR §431.206) outline states' obligation to inform applicants and beneficiaries of their right to a hearing and the method for obtaining a hearing and specify "that [the applicant or beneficiary] may represent himself or use legal counsel, a relative, a friend, or other spokesman." The regulations go on to outline the procedural rights of beneficiaries or applicants, or their representatives, in the hearing process (42 CFR §431.242). Beneficiaries and applicants have rights to examine the case file before and during the hearing, bring witnesses, establish pertinent facts and circumstances, present an argument without undue interference, and question or refute testimony or evidence, including the right to cross-examine witnesses.
SCHIP beneficiaries in and applicants for expanded Medicaid programs have the same rights to review as other Medicaid beneficiaries and applicants. In states that have established SCHIP programs that are separate from Medicaid, the states must still establish a process for impartial reviews of both eligibility and enrollment matters, and health services matters--states must give enrollees an opportunity for external review of a delay, denial, reduction, suspension, or termination of health services or a health plans' failure to provide timely services (42 CFR §457.1130). The SCHIP regulations (42 CFR §457.1140) say: "In adopting the procedures for review of matters described in §457.1130, a State must ensure that . . . d) Applicants and enrollees have an opportunity to--(1) Represent themselves or have representatives of their choosing in the review process. . . ."
Need for assistance
Though federal regulations give consumers the right to represent themselves in health plan appeals, Medicaid fair hearings, and SCHIP reviews, data shows that consumers benefit when they receive expert guidance regarding the rules that might apply to the case and the kinds of facts or evidence that are pertinent to those rules. In cases involving access to a service provided under managed care, medical practice guidelines and plan utilization review criteria may be involved; consumers are more likely to be successful in a hearing if they or their representatives have studied these guidelines and obtained medical evidence about how their situation compares to standards of medical practice.
Organizations and agencies in a few states have documented consumers' needs for help with health plan grievances and appeals. Many Medicaid managed care consumers do not realize that they have a right to file either a grievance with their health plan or a request for a local or state hearing when they are denied care. This problem was documented in Tennessee in 1996 (42 percent of beneficiaries did not receive basic information about plan-level grievances or state agency appeals); in New York City in 1996 (only 45 percent of managed care enrollees knew how to complain to their plans about problems); and in the District of Columbia in 1997 (only one-third of Head Start families enrolled in managed care knew how to complain through their plans, and even fewer knew how to file for Medicaid fair hearings.)[4] Ombudsman programs can help to fill this knowledge gap. In New York City, after surveys documented the need, the Managed Care Community Assistance Program (MCCAP) was formed under contract with the city's Department of Health and Mental Hygiene in 1999 to provide education and individualized assistance to managed care enrollees.
Data from at least one state show that consumers who pursue grievances and appeals through their health plans are more likely to be successful when they have help in preparing their case. (National data are not available about consumers' experiences in grievances, appeals, and hearings with and without assistance.) The Health Education and Advocacy Unit of the Maryland Attorney General's Office serves as an ombudsman primarily for privately insured consumers. It assists consumers with health care disputes by gathering information from the patient, providers, and health plans about the patient's condition, the service requested, and the relevant utilization criteria. The Health Education and Advocacy Unit presents this information to the insurer for reconsideration and, when necessary, prepares and files a formal written grievance on behalf of the patient. When the patient goes on to request an external review, the evidence gathered by the Health Education and Advocacy Unit is made part of the record. The Unit thus assists consumers in preparing their cases but stops short of actual representation. In 2001, for consumers assisted by the Health Education and Advocacy Unit, 70 percent of adverse decisions are overturned. This overturn rate among consumers receiving help is better than that experienced by Maryland consumers overall--overall, 56 percent of adverse decisions in Maryland are overturned during the grievance process.[5]
Without help, even privately insured consumers frequently get discouraged before they reach external reviews. This is unfortunate because about half of the time, privately insured consumers who do reach the external review level are granted relief through that process.[6]
Some states publicize health assistance programs as a source of help with grievances and hearings
Some states require Medicaid health plans to list a health assistance program on denial of care notices as a source where consumers might get help with complaints or appeals. In some states, legal assistance offices also serve as health care assistance programs, and the state lists that contact information on notices of Medicaid denials. Some other states provide a list of resources to consumers requesting Medicaid fair hearings, and these lists include health assistance programs as well as any other legal assistance programs that are available without charge. Minnesota, Missouri, New York, and Tennessee are among states that inform consumers that health assistance programs may be able to help them with grievances, appeals, and/or fair hearings.
The varying role of ombudsman programs in hearings
Since Medicaid ombudsman programs are staffed and structured differently, it is not surprising that they play varying roles in fair hearings. Appropriately, those housed in legal services programs are most likely to both assist consumers with preparation and represent consumers. Other ombudsman programs help consumers prepare their cases, gather evidence, file hearing requests, and sometimes accompany consumers to hearings without acting as their representatives, but they or their states are careful also to inform consumers about where they can secure legal representation. Some examples of varying program roles, gathered primarily from a snapshot survey of Medicaid health assistance programs in September 2002, are listed below.
Comprehensive Roles
- The Vermont Office of Health Care Ombudsman helps consumers who need assistance navigating appeals "from beginning to end. The Ombudsman offers comprehensive consumer services, including legal representation when necessary."[7] This program is housed in Vermont Legal Aid. It was created by a state statute and has contracts both with Vermont's Insurance Division within the Department of Banking, Insurance, Securities & Health Care Administration and its Medicaid agency to assist publicly and privately insured consumers.
-
The Missouri Medicaid agency contracts with Legal Aid of Western Missouri, to provide health assistance services for Medicaid and SCHIP managed care enrollees in the western part of the state. Legal Aid of Western Missouri assists clients in Medicaid hearings by preparing the case and appearing with clients in the administrative hearings. At the bottom of every notice denying, suspending, reducing, or terminating Medicaid benefits, the state is required to put this notice: "You can get legal help at no cost to you by contacting Legal Aid of Western Missouri, 1125 Grand Blvd, Suite 1900, KCMO 64106 or via phone at 816‑474‑6750." When a Medicaid or SCHIP health plan sends notice about a denial, reduction, or termination of a service under managed care, the plan adds, "Ask for the MC+ Advocacy Project."
-
In California, the Health Consumer Alliance receives funding from private foundations to assist Medicaid and SCHIP consumers. The Alliance is operated through legal services programs in a number of counties. The San Diego office, the Consumer Center for Health Education and Advocacy (CCHEA), replied to our survey. CCHEA represents consumers in hearings and helps them prepare their side of the case. Denial notices list CCHEA's name, address, and phone number and suggest that consumers call them for assistance. The program is on a list of resources given to people pursuing Medicaid fair hearings but not yet to people pursuing grievances or appeals through health plans.
- In New York City, the MCCAP project assists managed care enrollees under a contract with the New York City Department of Health. Community Services Society (CSS) is the lead agency for MCCAP, and CSS subcontracts with a number of other community-based organizations to carry out the work. As a whole, the MCCAP project assists consumers with fair hearings, and one of the subcontracting organizations, Legal Aid, is listed on local Medicaid denial notices.
Programs that provide some assistance with hearings but also refer consumers to legal services
-
Minnesota Office of the Ombudsman for Managed Care, Department of Health actually represents some consumers in hearings and provides more limited assistance to other consumers in preparing for hearings. The state requires contracting health plans to include a notice about the ombudsman's services on all denial letters: "A state ombudsman may be able to help with your problem. They can also help you complain or appeal to the health plan or the state. Call (651) 296‑1256 or toll‑free 1‑800‑657‑3729. Or write to them at this address. . . ." When consumers appeal to the state, they also receive a list of legal services programs.
-
In Tennessee, the TennCare Partners Advocacy Line is a project of Mental Health Association of Tennessee and is funded under a contract with the Medicaid agency. TennCare Partners does not represent consumers in fair hearings, but it refers them to other organizations for representation and assistance with hearings. The program is listed on denial notices. When consumers pursue fair hearings or health plan grievances, the state provides them with a list of resources. TennCare Partners is listed for advocacy (but not legal) help.
Conclusion
Ombudsman programs that educate consumers about their rights to file grievances and request fair hearings play a valuable role. Some ombudsman programs also provide important guidance to consumers throughout the grievance, appeal, and/or fair hearing process, explaining what guidelines or regulations apply to their cases and assisting consumers in gathering and presenting relevant evidence.
It is important for ombudsman programs to consider their own capacities to assist consumers in a hearing. For example, ombudsman programs that are located in state government should consider whether they are adequately shielded from conflicts of interest and whether their roles with respect to the state are clear to beneficiaries--if a program that is advertised as a source of consumer help also has to gather evidence for a health plan's or state's use in a fair hearing, its role in assisting consumers will be compromised. Ombudsman programs that do not include attorneys should be sure that consumers know where they can get legal representation, particularly if an attorney will represent the opposing party at the hearing. Even if an ombudsman program stops short of actual representation, it can aid consumers greatly by helping them understand the hearing process and prepare their cases.
[1] Medicaid hearings are also often called "fair hearings," "administrative hearings," or "evidentiary hearings."
[2] Families USA, Consumer Health Assistance Programs: Report on a National Survey, (Washington, DC: Families USA, June 2001).
[3] Medicaid managed care regulations refer to "State fair hearings." Elsewhere, regulations simply refer to "hearings."
[4] Gordon Bonnyman, Enrollee Grievances (TennCare) (Nashville, TN: Tennessee Justice Center, July 1996), 2; Christine Molnar, et al., Knowledge Gap: What Medicaid Beneficiaries Understand and What They Don't about Medicaid Managed Care (NYC: Community Service Society, 1996), 33; Families USA Head Start Families' Experiences in Medicaid Managed Care (Washington, DC: Families USA Foundation, 1997).
[5] Health Education and Advocacy Unit, Maryland Office of the Attorney General, Annual Report 2001, 10.
[6] Karen Pollitz, et al. Assessing State External Review Programs and the Effects of Pending Federal Patients' Rights Legislation (Washington, DC: Kaiser Family Foundation, 2002).
[7] Pollitz, Ibid, 11.
[Return to top]
