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Issue Brief – External Review Options Available Under the Federal Facilitated and State Marketplaces

February 26, 2014

The Patient Protection and Affordable Care Act (PPACA) was enacted in March 2010. This landmark health legislation is altering the way health insurance providers are able to offer health insurance, and likewise transforming the way in which consumers are able to purchase insurance. Primarily, these changes are being driven by the creation and launch of the Health Insurance Marketplace (also known as the Health Insurance Exchange) – the government-run insurance exchange that provides consumers with an online portal for locating and purchasing appropriate health insurance options.

As in other insurance marketplaces, health plans offered to consumers on the Exchanges must adhere to specific policies and regulations. This is true for the method through which health plans conduct internal and external appeals as well.

As background, PPACA addresses the topic of external review in Section 2719, which itself references an influential document from the National Association of Insurance Commissioners (NAIC) known as the Uniform Health Carrier External Review Model Act (known as the "Model Act"). According to Jolie Matthews, Senior Health and Life Policy Counsel with NAIC, the Model Act serves as the baseline level of requirements that health plans must adhere to when conducting external appeals. This regulatory baseline applies to all programs, including the federal external review process (FERP), multi-state plan programs (MSPPs), and pre-existing condition insurance plans (PCIPs). The U.S Office of Personnel Management (OPM) was tasked with managing the external review process under FERP, MSPP and PCIP, and is responsible for providing guidance regarding the State-based Exchange programs.

This Issue Brief provides an overview of the external review processes available under the Federal and State Exchanges in an effort to help unravel a sometimes confusing process for all stakeholders, including health plans, consumers and independent review organizations (IROs). It also recognizes the importance of using accredited IROs in the external review process available under the ACA (Affordable Care Act), and the leading organization behind accredited IROs – the National Association of Independent Review Organizations (NAIRO).

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