Appeal type: Medical necessity
Decision: Overturned

Diagnosis: Mental Health/Other/Delusions/Hallucinations.
Treatment: Mental health: Residential.
The health plan denied the requested inpatient stay. 
The health plan's determination is partially overturned.


The patient is an adult female receiving residential level mental health treatment to address schizophrenia and co-morbid unspecified anxiety disorder with a history of posttraumatic stress disorder (PTSD) and a history of poly-substance use with cannabis, alcohol, stimulant (cocaine), and other psychoactive class substances, as well as nicotine at 12 pack per day use. The patient was known to use cannabis or CBD (Cannabidiol) to address PTSD symptoms and sleep disturbance.
The patient was admitted in the context of severe and persistent mental illness characterized by delusions and hallucinations, and a lack of insight (anosognosia) that resulted in non-compliance with medications. Before the admission, the patient had been in another residential program with a transfer to an extended stay program. The patient did not tolerate the extended stay treatment environment due to an exacerbation of her delusions that she was being experimented upon and that her body was being invaded. Thus, she was admitted back to residential level treatment with plans for continued intensive treatment together with the structure and monitoring of residential level service.

The patient was noted to gain insight with a medication regimen that was stabilized. Nonetheless, her delusions and auditory hallucinations persisted. However, there were no safety concerns, and there had been no general medical issues other than persistent nausea and constipation. The patient was discharged with a return to her mother's home with plans for clinically appropriate aftercare.

The health plan's determination of medical necessity is overturned, in part. 

In accordance with prevailing standards of medical practice and the NY State instruction for his review, the patient did require the continued structure, monitoring, and treatment with a residential level of care during the interval under review to administer the continued treatment for the psychiatric disturbance in this case while conducting ongoing evaluations, and observing the patient's functioning with intense therapy and monitoring for response to medications that had been adjusted accordingly. It was medically necessary for this patient to continue with 24-hour monitoring and remain in a residential level structure given the persistent symptoms of chronic psychosis and dysregulated emotions, the continued disturbance of thought with active symptoms of psychosis that represented a safety risk, as well as high risk for relapse with a history of co-occurring substance use disorder and treatment failure with prior treatment efforts. Additionally, the residential stay during this time interval was medically necessary to monitor the response to medications-as noted, especially given limited insight and impaired judgment, and non-compliance with medications while receiving outpatient and residential and extended care services before her referral to residential treatment.
However, the continued residential level treatment was not medically necessary in this case. The patient had made progress with the treatment and was noted to be functioning better with clearer thinking and improved insight with continued support from family-focused sessions, all of which were indicative of the patient's ability to continue treatment in a less restrictive treatment setting. The patient could have been effectively managed with an alternate level of care, based upon the submitted documentation and in keeping with prevailing standards of medical practice and published guidelines pertaining to appropriate levels of care. There were no remaining treatment issues or clinical features that would have required the continued residential level services, structure, or monitoring. The health plan's determination of medical necessity is overturned, in par. Medical Necessity is medically necessary for the first portion of the say but upholds the denial for the last 5 days' stay as not medically necessary. Medical necessity is partially substantiated.