Department of Health and Human Servces

OFFICE OF

INSPECTOR GENERAL

MEDICAID MANDATORY SECOND

SURGICAL OPINION PROGRAMS:

SUMMARIES OF STATE PROGRAMS

Richard P. Kusserow

INSPECfOR GENERA

OEI-03-81531  . . . ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    ....    . . . . . . . .. 
TABLE OF CONTENTS

INODUCTION. . 

PROGRA EIEMENTS 
........................................... 3

APPENDIX A: Mandatory SSOP Program Admstrators 
by State  . . . . . . . A
APPENDIX B: Mandatory SSOP Program Objectives 
by State  . . . . . .. B
APPENDIX C: Mandatory SSOP Frequently Covered 
Procedures by State  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. C
APPENDIX D: Mandatory SSOP Restrictions on Second 
Opinon Consultants by State  . . . . . . . . . . . . . . . . . . . . . . . . . . D
APPENDIX E: Mandatory SSOP Reimbursement Policies 
by State  . . . . . .. E INTRODUCTION

PURE 
Ths report sumarizes the common elements of the I4 State Medicaid mandatory 
Second Surgical Opinon Programs (SSOPs) in exitence in I 99. 
BACKGROUN 
Second Surgical Opinion Programs provide patients with an independent medical 
opinon on the need for electe surgery. The seond opinion physician consultant 
evaluates the decision of the referrg physician and provides an independent 
determation on the necessity of the proposed surgery. 
Theoreticall, SSOPs benefit patints by encouragig them to be more inormed and 
involved in their medica treatment, by preventig unecessary surgery, and promoting 
higher quality medical care. Preventig unecessary surgery can also save money. 
An SSOP can be voluntary or mandatory. Voluntar programs encourage patients to 
seek a second opinon before surgery. However, the surgery is covered even if the 
progr 
patient dos not obtain a second opinon. In contrast, mandatory  requie 
fu 
patients to obtain a second opinon before surgery as a condition of 
health benefit 
coverage. 
Studies have shown that voluntar SSOPs have not reduced unecessary surgery or 
achieved cost savigs because patient paricipation is low. Some mandatory SSOPs 
have proven successfu in both reducing unecessary surgery and savig money. 
sumaried 
In a companon report (OEI-03-89-0I530), we  the results of a study which 
provides inormation on recent State evaluations of Medicaid mandatory SSOPs. We 
concluded that evidence is not strong enough to requie that al States adopt 
mandatory SSOPs. We recommended that HCFA ensure that States put into place 
utition 
appropriate  control programs, which could, but need not, include SSOPs. 
We are providig the inormation in ths report to HCFA and State Medicad agencies 
for their consideration in designg such programs. 
MEODOLOY 
We obtaied detailed information from the I4 States with mandatory SSOPs. The 
inormation included: year established, admnisterig agency, objectives, covered 
procedures, reimbursement policy, nonconfiation rate, and program evaluation. We  visited four States (Colorado, Massachusetts, Michigan, and Pennsylvania) and 
conducted detaled telephone intervews with the remaing States. We obtaied 
veri  durg 
wrtten documentation to  the information collected  the site visits and 
telephone diussions.

sumaris 
Ths report  inormation on the followig SSOP program elements: 
program admstrator, program objectes, covered procdures, role of second 
opinon consultant, reimburment policies, nonconfation rates, and program 
evaluations.  PROGRAM ELEMENTS

As shown in the followig map, I4 State Medicaid programs had mandatory SSOPs in 
place durg I 99. These States were Colorado, Indiana, Maryland, Massachusetts 
Michigan, Miesota, Missour, New Jersey, Oregon, Pennsylvania, Tennessee 
Virgia, Washigton, and Wisconsin. 
HAIf 
STATES WITH MANDATORY SSOPS 
::::::::::::::::I  AS OF CALENDAR YEAR 1990 
Massachusetts, which established its SSOP in I976, has the oldest program stil in 
operation. Michigan also established its SSOP in I976, but ended the program in 
October I99. 
Most other States established their programs between I98I and I986. The newest 
programs are in Pennsylvania and Maryland, which established mandatory SSOPs in 
I989 and I99, respectively. 
ADMITOR 
PROGRA 
The SSOPs are admnistered by State Medicaid Agencies, Medicare Peer Review 
Organition (PROs), or private organiztions. Four State agencies admster the 
SSOPs themselves. Five States use PROs to admnister their programs, and five 
others use private review groups. See Appendi A for a State by State list of
admsterig 
agencies.  OBJ 
PROGRA 
We identified four distinct program objectives in the Medicaid mandatory SSOPs: 
prevent unnecessary surgery, 
save money, 
educate patients about treatment alternatives, and 
improve quality of patient care. 
States varied in the number of objectives included in their programs. Six States 
included all four objectives, five had three objectives, and three others had two 
objectives. 
Two States (Colorado and Pennsylvania) consider patient education their priary 
objective. Washigton places emphasis on reducing unecessary surgery and patient 
education, whie Wisconsin views reducing unecessary surgery and improvig quality 
of care as most important. Each of these States has other program 
objectives as well 
but they are secondary in importance. See Appendi B for a table of program 
objecties by State. 
COVE PROCUR 
Both the number of procedures covered and the procdures themselves varied widely. 
One State, Oregon, includes all proposed elective inpatient procdures in its 
mandatory SSOP. In the other I3 States, we identifed 45 dierent elective 
procedures which were covered by at least I program. The number of procedures 
covered by SSOPs ranged from 27 (Colorado and Indiana) to 2 (Washigton), with a 
median of IO. 
The most frequently covered procdures were hysterectomy (13), tonsilectomy/ 
adenoidectomy (12), cholecystectomy (IO), herna repair (8), lamiectomy (8), spinal 
fusion (7), hemorrhoidectomy (7), coronary artery bypas graft (6), and cataract 
were covered by only 2 States, whie another IS 
removal (6). Twelve other procedures 
See Appendi C for a matr of the most frequentl 
were covered by only I State. 
covered procdures by State. 
Because of the wide variation in covered procedures, we asked States how procedures 
were selected. Nine indicated that they selected high frequency, high cost procedures 
based on analysis of data available at the time their programs were established. 
However, few States review and update their covered procedures lists in a systematic 
way. Some have not changed 
since the early I980s.  The exception is Colorado, which conducts a formal annual analis of covered 
determ 
procedures. The review is designed to (I)  whether curentl covered 
procedures are stil appropriate, (2) identi changes in physician practice patterns 
and (3) evaluate the impact of new technology on the appropriateness of coered 
procedures. 
ROLE OF SECND OPINON CONSUTAN 
The second opinon consultat is a physician who corroborates or refutes the referrg 
physician s recommendation for surgery. The States are almost equal dided on 
four key varibles: 
consultant qualications - Six States requie the second opinon consultat to 
bod certif 
be  or eligible for certcation. The remaider requie onl that 
the consultant be licensed to practice in that State. 
maitai a 
physician panel -- Seven States  panel of physicians in various 
specialties. Only physician on the panel may serve as the second opinon 
remaig 
consultant. The  seven States have no such requiement. 
restrictions on performi surgety -- Six States allow the consultant to perform 
the proposed surgery whie seven others prohibit ths practice. One State has 
th 
not established a policy on  isue. 
business relationship between referrni physician and consultant -- Eleven 
States place restrictions on the business relationship between the referrg 
physician and the second opinon consultant. 
Four States (Colorado, Maschustts Michigan and New Jersey) place the most 
restrictions on the second opinon consultant. These States requie board certcation 
(or eligibilty), select consultats from a 
preestablished panel, prohtbit the consultants 
from performg the propod surgery, and restrict their business relationships with 
referrg 
physicians. 
In contrast, programs in two States (Miouri and Tennessee) place no restrictions on 
the second opinon consultat. Two others (Indiana and Virgia) lit onl the 
business relationship between the referrg physician and the consultat. 
Appendi D provides more detail on State restrictions on second opinon consultants. 
REIMUR 
POUCI 
Nonconfng second opinon -- Five of the I4 States pay for surgery only if the 
second opinon confis the referrg physician s opinon. The other nine reimburse 
nonconfg 
for surgery even if there is a  second opinon.  Failure to obtain a required second opinion -- Ten States provide no coverage for 
surgery if the patient fails to obtain a requied second opinon. Four States provide 
fu or partal benefits. Pennsylvania wi pay hal of the normal reimbursement to 
urgeon and the facilty. Tennessee, Washigton, and Wisconsin provide 
both the 

coverage for the facilty, but pay nothig to the surgeon. 
See Appendi E for more inormation on State reimbursement policies. 
NONCONFTION RATE 
Eight States provided recent nonconfation rate data. The nonconfation rate is 
confi 
the percentage of time that a second opinon does not  the fist opinon. 
As shown below, nonconfation rates ranged from 0.59 percent in Oregon to 10. 
percentage in Michigan, with a mean of 4.9 percent. States reportg the highest 
nonconftion rates (MI, W A, WI, MA and NJ) reimburse for surgery even with
nonconf 
second opinons. In thee of these States (MA MI, and W A), about 
nonconfg 
half the Medicad clients had the surgery despite the  second opinon. 
NONCONFIRMATION RATES

_...CnlI O.ICI P8Y. tor .uro.ry.  NO P8y",.nt tor .urg.ry
wit" nonoontlr,.,no  wll" nonoontlrmino 
..0.nCl opinion  ..00nCl opinion 
MICHIGAN 
10. 
fNSHINGTON 
WISCONSIN 
MASSACHUSETTS 
NEW JERSEY

f"4

MINNESOTA 
COLORADO 
OREGON 
Percent 
, States with the lowest nonconfiation rates (OR, CO and MN) do not 
In contrast
pay for surgery with a nonconfirming second opinion.  In Michigan, which reported the highest nonconfation  6 percent) 
rate (10. hal of 
nonconfg 
the Medicaid clients had surgery despite a 
second opinon. 
mentioned earlier, Michigan discontinued its SSOP in I 99. 
PROGRA EVALUATIONS 
Only thee States (Colorado, Michigan, and Wiscnsin) were able to provide recent 
evaluation inormation on their programs. See the companon report for more 
inormation on ths subject.  APPENDIX A

MAATORY SECOND SURGICAL OPINION PROGRAS

PROGRA ADMINISTRTORS

as of June 1990

PROGRA ADMISTRTOR

PEE  PRIATE 
MEICA 
REVIW 
STATE 
AGENCY  ORGANTION  ORGANTION 
COLORA 
INIAA 
MAYL 
MASACHSETI 
MICHIGAN 
MINOTA 
MISSOURI 
NEW JERSEY 
OREGON 
PENNSYLVANIA 
TENNEE 
VIGIN 
WASHINGTON 
WISCONSIN 
TOTAL 
A 
 . = 
APPENDIX 

MAATORY SECOND SURGICAL OPINION PROGRAS

PROGRA OBJECfNES BY STATE

June 1990

OBJ

UNY 
IMROVE 
QUAU  EPDAT"Il 
SAVIGS  SUGEY  OF 
COLORA 
INIAA 
MAYL 
MASACHSET 
MICHIGAN 
MINOTA 
MISSOURI 
NEW JESEY 
OREGON 
PENSYLVANIA 
TENNSEE 
VIGINIA 
WASHINGTON 
WISCONSIN  .X 
TOTAL 
OBJ

DE PRY 
B - I
 APPENDIX 

MAATORY SECOND SURGICAL OPINION PROGRAS 
FREQUENTY COVERED PROCEDURES BY STATE* 
as of June 1990 
STAlE 
PR(X 
HYSTEREcrMY (13) 
TONSILcrMYI

ADENOIDECMY (12)

CHOLECYcrOMY (10)

HEIA REAI 
(8)

LAINMY 
(8)

HEMORROIDEcrOMY (7) 
SPINAL FUSION (7) 
CORONARY AR'rRY

GRA 
BYPAS  (6) 
CATARcr REOVAL 
(6) 
DllTATION 

CURTfAGE (5)

JOIN REPLACEMENT (5) 
TRSUR 
REEcnON TOFI 
 
PROSA'r-
(5)

DEVI'rD NASAL SEPTU 
REEcnON (4) 
BRET 
SURGERY (3) 
CORONARY

ANGIOPLA (3)

FO 
SURGERY (3) 
MYINGOTOMY (3) 
VARICOSE VEIN

EXCISIONILIGATION (3)

. Do no inud Oreon which reuir SSOP for  eleiv inpatiet prure. 
C - I
 APPENDIX D

MAATORY SECOND SURGICAL OPINION PROGRAS

RESTRICfIONS ON SECOND OPINION CONSULTANS

as of June 1990

MAY  BUS 
CEBTOICARATI  PFHROIMC  PER  wn
PHIa 
EUGmlL  PAN  SUGERY 
COLORA 
INIAA 
MAYL 
MAACHSET 
MICHIGAN 
MINOTA 
MISSOURI 
NEW JERSEY 
OREGON  NO POLICY 
PENNSYLV 
1ENNEE 
VIGINIA 
WASHINGTON 
WISCONSIN 
TOTAL 
D - I
 APPENDIX E

MAATORY SECOND SURGICAL OPINION PROGRAS 
STATE REIMURSEMENT POLICY 
PAYS  PAYS 
FO SUGEY  FO SUGEY 
PATI FAI 
IF 
SE  STHO O BAI
OPIN  OPIN 
FAC 
SUGE 
COLORA  NONE  NONE 
INIAA  NONE  NONE 
MAYL 
NONE  NONE 
MASACHSETI  NONE  NONE 
MICHIGAN  NONE  NONE 
MINOTA  NONE  NONE 
MISSOURI  NONE  NONE 
NEW JERSEY  NONE  NONE 
OREGON  NONE  NONE 
PENNSYLVANIA  SO%  SO% 
TENNEE  100  NONE 
VIGINIA  NONE  NONE 
WASHINGTON  100  NONE 
WISCONSIN  100  NONE 
TOTAL 
E - 1