47262 Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules

1As used in this document, the term ‘‘managed

care delivery systems’’ includes any measures taken

by medical practitioners, insurers, or group health

plans to control costs by limiting access to medical

services.

2This regulation was published as a final rule

with a request for comments, 62 FR 23368 (April

30, 1997). The regulation amends a prior regulation

codified at 42 CFR § 417.600–620.

DEPARTMENT OF LABOR

Pension and Welfare Benefits

Administration

29 CFR Part 2560

Claims Procedures for Employee

Benefit Plans

AGENCY: Pension and Welfare Benefits

Administration, Labor.

ACTION: Request for information.

SUMMARY: This document requests

information from the public concerning

the advisability of amending the

existing regulation under the Employee

Retirement Income Security Act of 1974

(ERISA) that establishes minimum

requirements for employee benefit plan

claims procedures. The term ‘‘claims

procedure’’ refers to the process that

employee benefit plans must provide for

participants and beneficiaries who seek

to obtain pension or welfare plan

benefits, including requests for medical

treatment or services, consideration of

claims, and review of denials of claims

by plans. The primary purpose of this

notice is to obtain information to assist

the Department of Labor (the

Department) in evaluating (1) The extent

to which the current claims procedure

regulation assures that group health

plan participants and beneficiaries are

provided with effective and timely

means to file and resolve claims for

health care benefits, and (2) whether

and in what way the existing minimum

requirements should be amended with

respect to group health plans covered by

ERISA. The furnished information also

will assist the Department in

determining whether the regulation

should be amended with respect to

pension plans covered by ERISA and in

developing legislative proposals to

address any identified deficiencies

relating to the claims procedures that

cannot be addressed by amending the

current regulation.

DATES: Written comments must be

submitted to the Department of Labor on

or before November 7, 1997.

ADDRESSES: Comments (preferably, at

least six copies) should be addressed to

the Office of Regulations and

Interpretations, Pension and Welfare

Benefits Administration, Room N–5669,

U.S. Department of Labor, Washington,

D.C. 20210. Attention: Claims Procedure

RFI. All comments received will be

available for public inspection at the

Public Disclosure Room, Pension and

Welfare Benefits Administration, U.S.

Department of Labor, Room N–5638,

200 Constitution Ave., N.W.,

Washington, D.C. 20210.

FOR FURTHER INFORMATION CONTACT:

Jeffrey J. Turner or Susan G. Lahne,

Office of Regulations and

Interpretations, Pension and Welfare

Benefits Administration, U.S.

Department of Labor, Washington, D.C.

20210, telephone (202) 219–7461, or

Cynthia Caldwell Weglicki, Plan

Benefits Security Division, Office of the

Solicitor, U.S. Department of Labor,

Washington, D.C., telephone (202) 219–

4600, ext. 106. These are not toll-free

numbers.

SUPPLEMENTARY INFORMATION:

A. Background

The Department’s regulation,

published in 1977, was drafted in

response to concerns about plan

practices prior to the enactment of

ERISA, particularly with respect to

participants’ lack of information about

claims procedures generally. This

regulation makes no distinction between

pension and health care plans. In the

intervening years, dramatic changes in

health care delivery have raised many

issues concerning access, coverage, and

quality of care and have resulted in

various legislative responses. In

addition to numerous initiatives at the

State government level, a number of

Federal laws have been enacted to

address these issues. The Health

Insurance Portability and

Accountability Act of 1996, the

Newborns and Mothers Health

Protection Act of 1996, and the Mental

Health Parity Act of 1996 are recent

examples. In addition, on September 5,

1996, President Clinton signed

Executive Order 13017 establishing the

Advisory Commission on Consumer

Protection and Quality in the Health

Care Industry. More recently, the

Balanced Budget Act of 1997 (P.L. 105–

33) contains a number of provisions

relating to managed care in connection

with the Medicare and Medicaid

programs.

One of the most important changes to

occur has been the growth of managed

health care delivery systems.1 These

arrangements adopt various measures to

control costs and increase efficiency.

For example, they may impose limits or

conditions on an individual’s choice of

physicians and often require prior

approval before an individual can

obtain, or obtain reimbursement for,

hospital care or medical services

provided by a specialist. Both fee-forservice and health maintenance

organizations (HMOs), as well as

preferred provider and other types of

delivery systems, may rely on managed

care measures. As a result of the

prevalence of managed care measures,

fair and expeditious resolution of

benefits disputes has become an

increasingly important issue. Managed

care measures magnify the significance

of the procedures that surround the

decision whether medical services will

be made available to a participant or

beneficiary, and suggest that the

Department should consider whether its

current regulatory minimum standards

for such procedures are sufficient to

ensure that decisions on the availability

of medical care are made in a manner

that adequately protects the interests of

the individual seeking benefits.

At the same time, technological

advances in business communications

in the last twenty years facilitate more

rapid communications and decisionmaking by plans and participants. The

Department’s regulation may no longer

reflect current plan practices with

respect to these aspects of filing and

reviewing benefit claims. The

Department seeks information about

current practices in this area. Along the

same lines, market practices such as

accreditation by various professional

and consumer groups have become

important private regulatory forces in

the managed care arena. Publication of

model acts, such as the Utilization

Review Model Act and the Health

Carrier Grievance Procedure Model Act

developed by the National Association

of Insurance Commissioners (NAIC),

reflect the importance of time-sensitive

review procedures. The NAIC model

acts have served as the basis for State

legislation to provide procedural

protections, including expedited review

of claims, to individuals who receive

medical benefits through health

insurance contracts that incorporate

managed care arrangements.

The Department is not alone in its

concern for timely resolution of requests

for medical treatment from group health

plans. The Health Care Financing

Administration (HCFA) has recently

published a final regulation establishing

an expedited process in certain

circumstances for Medicare

beneficiaries enrolled in managed care

entities such as health maintenance

organizations. 2 The HCFA regulation

requires that managed care entities

establish an expedited review process in

situations where the time required for
Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules 47263

3 42 CFR § 417.124 does not relate to the

requirements HMOs must meet in order to maintain

a contract with the Health Care Financing

Administration through which health care benefits

are provided to Medicare beneficiaries. Section

1876 of title XVIII of the Social Security Act (42

U.S.C. 1395mm) lists those requirements.

Regulations implementing the benefit request and

benefit review rights of Medicare beneficiaries who

participate in managed care delivery systems are

found at 42 CFR § 417.600 through § 417.638. This

RFI does not involve benefit review procedures for

Medicare beneficiaries.

the standard review process could

seriously jeopardize the life or health of

the Medicare beneficiary or the

beneficiary’s ability to regain maximum

function. The rule also provides that a

decision to discontinue services that are

currently being provided may also be

subject to the expedited review process.

In the preamble to the regulation, HCFA

indicates that it has drawn on the NAIC

model grievance act in developing the

provisions of the review procedure. As

discussed below in section C., Issues

Under Consideration, the Department

believes that the HCFA regulation and

the NAIC model acts may serve as the

basis for considering whether, and in

what respects, the minimum standards

set forth in the ERISA benefit claims

procedure regulation should be

amended.

B. Current ERISA Regulation

Section 503 of ERISA, 29 U.S.C.

§ 1133, provides that, in accordance

with regulations promulgated by the

Secretary of Labor (the Secretary), each

employee benefit plan must provide

‘‘adequate notice in writing to any

participant or beneficiary whose claim

for benefits under the plan has been

denied.’’ The notice must set forth the

specific reasons for the denial and must

be written in a manner calculated to be

understood by the claimant. Each plan

must also afford ‘‘a reasonable

opportunity’’ for any participant or

beneficiary whose claim has been

denied to obtain ‘‘a full and fair review’’

of the denial by the appropriate named

fiduciary of the plan.

The Department has issued a

regulation pursuant to the above

authority that establishes ‘‘certain

minimum requirements for employee

benefit plan procedures pertaining to

claims.’’ 29 CFR § 2560.503–1(a).

Generally speaking, the following

requirements apply. The claims

procedure of an employee benefit plan

covered by ERISA (hereinafter referred

to as an ERISA plan) must be described

in the plan’s summary plan description.

The procedure must not contain any

provision or be administered in any way

that would unduly inhibit the initiation

or processing of claims. Participants

must be informed in writing and in a

timely fashion of applicable time limits

for appeals and responses.

More specifically, the regulation

provides that claimants must be

informed in writing ‘‘within a

reasonable period of time’’ if a claim is

partially or wholly denied. 29 CFR

§ 2560.503–1(e)(1). For this purpose, the

regulation defines a period of time in

excess of 90 days after receipt of the

claim as unreasonable, unless ‘‘special

circumstances’’ require an extension of

time for processing. In that case, an

extension of an additional 90-day period

is available provided that the claimant

receives notice of the extension

describing the special circumstances

prior to the end of the original 90-day

period. The notice of a denial of a claim

for benefits must be written in a manner

calculated to be understood by the

claimant and must contain (1) specific

reason(s) for the denial, (2) reference to

plan provisions on which the denial is

based, (3) a description of any

additional material necessary to perfect

the claim and why it is necessary, and

(4) information about how to submit the

claim for review. If the notice is not

provided in this manner, the claim for

benefits is deemed to be denied.

The regulation also requires that every

plan establish a review procedure

providing a ‘‘reasonable opportunity’’ to

appeal denied claims to an appropriate

named fiduciary or designee. The

appeal must afford ‘‘a full and fair

review of the claim and its denial.’’ 29

CFR § 2560.503–1(g)(1). Minimum

requirements for the review procedure

include the right to request a review by

a written application from the claimant,

the right to review pertinent documents,

and the right to submit issues and

comments in writing. A claimant must

have at least 60 days after receipt of the

denial in which to request a review. A

decision on the review must ordinarily

be made within 60 days after the request

for a review, unless special

circumstances (such as the need to hold

a hearing if the plan provides for a

hearing) require an extension of time.

However, the decision may not be

delayed more than 120 days after receipt

of the request for review. Special rules

provide longer periods of time for plans

whose named fiduciary is a group, such

as a board of trustees, that holds

regularly scheduled meetings at least

quarterly. In that case, the review

decision must be made by the scheduled

time of the next meeting, unless the

request for review is received within 30

days prior to that scheduled meeting, in

which case the decision is due no later

than the date of the group’s second

successive meeting, with a possible

extension to the date of the third

meeting if there are special

circumstances. 29 CFR § 2560.503–

1(h)(1)(ii). As with the initial denial, the

decision on review must be in writing,

include specific reasons for the decision

and references to plan provisions on

which the decision is based, and be

written in a manner calculated to be

understood by the claimant. If no review

decision is provided within the time

frames specified, the claim is deemed

denied.

Under the regulations, plans

established pursuant to collective

bargaining agreements are not treated

differently from other plans, except that

they are deemed to comply with the

regulatory standards for reviewing

denied claims if the collective

bargaining agreement pursuant to which

the plan is established either contains or

incorporates by reference provisions

concerning the filing and disposition of

benefit claims and a grievance and

arbitration procedure for handling

denied claims. Participants in plans

under which benefits are provided or

administered by State-regulated

insurance organizations may file claims

for benefits, obtain decisions and obtain

review of denials through those

organizations, but the minimum

standards otherwise remain the same.

The regulation excludes from its scope

employee benefit plans providing only

apprenticeship training benefits.

Claims procedures with respect to

benefits provided through a qualified

HMO, as defined in the Public Health

Service Act, 42 U.S.C. § 300e–9(d), are

deemed to satisfy the minimum ERISA

regulatory requirements if they satisfy

section 1301 of the Public Health

Service Act (42 U.S.C. § 300e) and the

regulations thereunder. 29 CFR

§ 2560.503–1(j). The regulation

addressing claims procedures for

federally qualified HMOs is codified in

42 CFR § 417.124.3 The pertinent

provisions of the Public Health Service

Act regulations require that each

qualified HMO prepare a written

description of, among other things, the

procedures to be followed in obtaining

benefits, a description of circumstances

under which benefits may be denied,

and grievance procedures. 42 CFR

§ 417.124(b). Grievance procedures must

be ‘‘meaningful’’ and must ensure that

complaints are transmitted in a timely

manner to appropriate decision makers

who have authority to take corrective

action. Appropriate action in response

to grievances is to be taken promptly,

with notice to concerned parties of the
47264 Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules

4The Public Health Service Act regulations

applicable to federally qualified HMOs require

written descriptions of circumstances under which

benefits may be denied and written grievance

procedures. 42 CFR § 417.124. Regulations

promulgated by the Office of Personnel

Management relating to both fee-for-service and

managed care providers participating in the Federal

Employees Health Benefits Plan (FEHBP) use terms

such as filing claims for payment or services,

reconsideration of claims that have been denied,

and review of decisions to deny claims. 5 CFR

§ 890.105. HCFA’s Medicare regulations provide an

appeals procedure for Medicare beneficiaries

contesting an ‘‘organization determination,’’ which,

generally speaking, is a decision by a health care

provider to deny, terminate, or not pay for medical

services that the beneficiary believes are covered

under the plan. A ‘‘reconsidered determination’’ is

the result of a review of the organization

determination. The NAIC Health Carrier Grievance

Model Act (October 1966) uses the term ‘‘adverse

determination’’ for a carrier’s decision that medical

services will be denied, reduced or terminated. The

Model Act provides for an appeals procedure to

review an adverse determination. The term

grievance is defined as a written complaint about

the availability or quality of health care services,

including, but not limited to adverse

determinations. State insurance laws and

regulations dealing with health care insurance

carriers display a similar variety of terms.

results of the HMO’s investigation. 42

CFR § 417.124(g).

C. Issues Under Consideration

Questions have been raised with

respect to whether the minimum

standards provided in the Department’s

regulation adequately assure timely and

appropriate recourse for employee

benefit plan participants and

beneficiaries making requests for

benefits, or seeking review of benefit

claims that have been denied in whole

or in part. Although issues that have

arisen in the context of group health

plans have provided the primary

impetus to these questions, section 503

of ERISA and the Department’s

regulation at 29 CFR § 2560.503–1 apply

to both employee welfare benefit plans

(the category that includes group health

plans) and employee pension benefit

plans. The Department is seeking

comments concerning the nature of

existing benefit determination and

review practices of plans and whether

the Department’s current regulation is

adequate to protect the interests of both

pension and welfare benefit plan

participants and beneficiaries.

The Department is aware that, under

current practices, entities that are

involved in providing health care

employ a variety of terms to describe the

process by which an individual eligible

for health care services seeks benefits or

seeks review of a decision to limit or

deny health care treatment or services.

Even where the procedural steps are

similar, entities may use different

terminology for the same procedural

step.4 As part of this RFI, the

Department is seeking information as to

whether and how it should address the

diversity in terminology that is used to

describe the procedural protections

afforded individuals.

In order to assist interested parties in

responding, this document contains a

list of specific questions designed to

elicit information that the Department

believes would be especially helpful in

determining whether and how to

develop a notice of proposed

rulemaking. The Department requests

that, in addressing the specific

questions in this document, responses

refer to the question number as listed in

the RFI. The questions listed by the

Department may not address all issues

relevant to claims procedures. The

Department further invites interested

parties to submit comments on other

aspects of the claims process that they

believe are pertinent to the

Department’s consideration of claims

procedures in employee benefit plans

covered by title I of ERISA.

In the individual questions below, the

following terms have specific meanings.

A ‘‘claim’’ is a request for a plan benefit

by a participant or beneficiary. A

‘‘claimant’’ is a participant or

beneficiary who has or intends to file a

claim. A ‘‘claims procedure’’ is the set

of rules or requirements by which a

claim is filed and resolved under the

plan. A ‘‘review’’ or ‘‘appeal’’ is the next

level or levels of claims resolution

under the plan after the initial decision

occurs or is deemed to have occurred.

Request for Information

Current Practices

1. What information is provided to

claimants when requests for services are

denied? What are plan practices

generally where the plan or a service

provider must give prior approval before

a participant or beneficiary can obtain

certain types of medical treatment?

2. What time frames are typical in

ERISA plan claims processes for initial

determination and for review of a

denied claim? Do plans have different

time frames for health care benefits that

require prior approval? Do plans

maintain special procedures for

processing such claims if they involve

‘‘urgent’’ or emergency care?

3. When and under what

circumstances do plans hire physicians

who are not affiliated with the plan to

provide independent opinions in

connection with a benefit claim? What

weight do plans give to the outside

opinion?

4. Do plans provide claims reviewers

financial incentives based on the

percentage of claims denied? Are there

compensation arrangements that might

influence the reviewers’ conclusions? If

yes, what are they?

5. The Department’s ERISA claims

procedure regulation provides that a

claimant seeking review of a denial

‘‘may review pertinent documents.’’ 29

CFR § 2560.503–1(g)(ii). The preamble

to the regulation explains that ‘‘[a]s part

of the review the participant must be

allowed to see all plan documents and

other papers which affect the claim.’’ 42

FR 27426 (May 27, 1977). What do plans

consider to be examples of pertinent

documents or other papers that might

affect a claim for benefits? Is there some

utility to permitting participants to

review pertinent documents prior to

filing a claim? Would it reduce claims

if a potential claimant could examine

documents before filing a claim? What

additional costs, if any, would such a

requirement impose on plans?

6. When and under what

circumstances do plans utilize

alternative dispute resolution,

arbitration, or similar processes with an

outside, independent decision-maker for

review of claims denials? Are there any

conditions or requirements for electing

such processes?

7. Are claimants being asked to pay

anything to the plan in order to pursue

or perfect their claims review rights? If

so, under what circumstances does this

occur? Note: The preamble to 29 CFR

§ 2560.503–1, Part II—Technical

Explanation of the Regulation, provides

that an otherwise reasonable claims

procedure may be deemed to be ‘‘not

reasonable if it contains other

provisions which unduly inhibit or

hamper the initiation or processing of

plan claims. For example, a claims

procedure may be deemed unreasonable

if it requires the payment of a fee as a

condition for filing a claim or obtaining

review of a denied claim.’’ 42 FR 27426

(May 27, 1977).

8. Are there problems making claims

processing procedures accessible to plan

participants who do not speak English?

Should the Department address these

problems in a regulation? If so, how?

9. What limits do plans impose on the

time within which a participant or

beneficiary may file a claim for benefits

or may request review? Should the

Department adopt minimum standards

for filing claims and new minimum

standards for requesting review?

10. To what extent are electronic

media used to receive or communicate

benefit claims information or to process

claims? What if any changes to the

regulation are necessary to

accommodate this?
Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules 47265

Expedited Claims Procedures

Recently HCFA published a final rule

requiring that managed care

organizations such as HMOs establish

an expedited procedure for Medicare

beneficiaries in situations where the

longer time frames in the standard

review process ‘‘could seriously

jeopardize the life or health of the

enrollee or the enrollee’s ability to

regain maximum function.’’ 42 CFR

§ 471.617(b). Expedited review must be

completed as quickly as the

beneficiary’s medical condition

requires, i.e., within 24 or 48 hours as

appropriate, but in no case longer than

72 hours, absent special circumstances.

The Medicare beneficiary, a

representative of the beneficiary, or a

physician may request expedited review

both for the initial request for benefits

and for review of decisions to deny or

terminate benefits. Any physician,

including one who is not affiliated with

the plan, may request expedited review

on behalf of a Medicare beneficiary, and

the plan must accept the physician’s

decision that expedited review is

necessary.

It is the responsibility of the managed

care organization to ensure that all

Medicare beneficiaries have a complete

written explanation of their benefit

review rights, of the availability of

expedited reviews, of the steps to

follow, and of the time limits for each

step of the procedures. When a request

for benefits is being reviewed after an

initial denial, HCFA’s regulation

requires that managed care

organizations provide Medicare

beneficiaries with a reasonable

opportunity to present evidence and

allegations of fact or law related to the

issues in dispute, in person as well as

in writing. Where the review is

expedited, involving a shorter time for

decision, the plan must inform

Medicare beneficiaries of the conditions

for submitting evidence. Medicare

regulations provide several levels of

review by entities outside the managed

care organization. An outside peer

review organization provides immediate

review of contested decisions to

discharge a Medicare beneficiary from

the hospital, and if, after the benefit

review process is completed, the initial

decision to deny the benefit is upheld,

an appeal is automatically sent to an

independent reviewer under contract

with HCFA. In the preamble to the

regulation, HCFA also asks for

comments concerning (1) guidelines for

notice and benefit review rights when

the level of services currently being

provided to Medicare beneficiaries is

being reduced, and (2) when review of

a reduction in the level of services

should be expedited.

11. Should the Department’s

regulation require ERISA plans to

provide expedited review? If yes, under

what circumstances should an

expedited review procedure be

available?

12. Would the HCFA regulation’s

expedited review procedure provide an

appropriate maximum time frame if

ERISA plans were required to adopt

expedited review procedures?

13. If ERISA plans were required to

adopt an expedited review procedure,

how should terms such as ‘‘medical

urgency’’ be defined? Should the

definition of medical urgency for

purposes of an expedited procedure be

limited to situations where delay could

jeopardize life or health or the ability to

regain maximum function, as in the

HCFA regulation, or should there be

some lesser standard, such as intractable

pain or temporary inability to perform

major life functions such as

employment?

14. What additional costs, if any,

would be imposed on plans if an

expedited claims procedure along the

lines of the HCFA regulation or the

NAIC model acts were required?

15. The HCFA expedited review

procedure permits a Medicare

beneficiary, a representative of the

Medicare beneficiary, or a physician to

request expedited review both for initial

benefit requests and for reconsideration

of requests that have been denied. The

managed care organization decides if

the request meets the criteria for

expedited treatment. However, any

physician, such as a non-plan

physician, may request expedited

review on behalf of a Medicare

beneficiary, and the managed care

organization must accept the

physician’s decision that expedited

review is necessary. If ERISA plans were

required to adopt some form of

expedited review, whose request should

initiate the process? Should this

authority be restricted to a physician

affiliated with the plan, or any

physician?

16. Should some claims, such as

emergency hospital admissions or

hospital discharges, always have

expedited review as a matter of course?

17. If some form of expedited review

is adopted for ERISA plans, and under

the terms of the regulation a claimant is

entitled to an expedited review, should

the plan administrator be subject to

penalties for noncompliance with the

procedure?

18. Would an expedited process be

subject to overuse or abuse by claimants

or physicians? If so, how can this be

avoided?

Other Aspects of Reviewing Claims

19. Would the HCFA regulation’s

system of permitting Medicare

beneficiaries or their representatives to

present new evidence throughout the

benefit review process work for ERISA

plans? Should ERISA claimants be

allowed to appear and present evidence

in person at some levels of the claims

review process? What additional costs,

if any, would such requirements impose

on plans?

20. In what, if any, situations should

an ERISA plan service provider be

required to continue services at the

previous level pending reconsideration

of a decision to reduce or terminate

services? Should any such requirement

affect the maximum time frames for

resolution of claims involving such

decisions?

21. In contrast to HCFA’s Medicare

regulation that provides several levels of

review by entities outside the managed

care organization, ERISA § 503 provides

that every plan shall provide ‘‘a full and

fair review by an appropriate named

fiduciary’’ of a decision denying a

claim. Do the Department’s minimum

regulatory standards that implement

this requirement provide sufficient

assurance of a disinterested hearing? If

not, what changes to the existing

regulation would assure adequate

impartiality in the review process?

22. The Department’s regulations at

29 CFR § 2560.503–1(f) require that

upon denial, the plan shall provide

‘‘[a]ppropriate information as to the

steps to be taken if the participant or

beneficiary wishes to submit his or her

claim for review.’’ The plan’s decision

on review must include specific written

reasons for the decision as well as

references to the pertinent plan

provisions on which the decision is

based. Should plans be required to

provide claimants with more

information concerning the claims

review process than is currently

required by the regulation? Should a

plan be required to inform participants

about the need to exhaust the plan’s

review process, as suggested by Kinkead

v. Southwestern Bell Corporation

Sickness & Accident Disability Benefit

Plan, No. 96–2282, 1997 U.S. App.

LEXIS 6532 at *5 (8th Cir. April 9,

1997), or about judicial recourse? If so,

what information should be provided to

participants?

23. Would it be helpful in reducing

claims and claims review requests to

require plans to provide definitions of

terms about which there may be

controversy or that may generate a
47266 Federal Register / Vol. 62, No. 173 / Monday, September 8, 1997 / Proposed Rules

number of appeals, such as ‘‘emergency

services’’ or ‘‘urgently needed services,’’

as some States have done?

24. Health care plans subject to

ERISA’s claim procedure regulation use

certain terms to describe the process by

which participants and beneficiaries

seek benefits or seek review of decisions

to deny, reduce, or limit benefits under

the plan. Other regulators, such as

HCFA, and FEHBP, as well as the NAIC

model Grievance Act and State

insurance laws, utilize different terms to

describe similar procedures. Should the

Department attempt to conform or crossreference its claims procedure

terminology to that of other regulatory

schemes? If so, which one?

Differences Among ERISA Plans

25. Is there a need to establish

uniform minimum standards for all

ERISA plan claims procedures,

including plans providing benefits

through federally qualified HMOs?

Note: Under the current regulation,

federally qualified HMOs are now

subject to a different set of regulations

under the Public Health Service Act. 29

CFR § 2560.503–1(j); 42 CFR § 417.1

through 417.169. What would be the

impact and additional costs, if any, of

requiring a uniform standard?

26. Under the Department’s current

regulation, certain plans established or

maintained pursuant to collective

bargaining agreements are deemed to

comply with the existing regulation

provided that provisions concerning

filing claims, the initial disposition of

claims, and a grievance and arbitration

procedure to which denied claims are

subject are referenced in the collective

bargaining agreement. 29 CFR

§ 2560.503–1(b)(2). Should claimants in

such plans be subject to differing claims

procedures depending on the terms of

the collective bargaining agreement, or

should there be a uniform claims

procedure for all ERISA plans? What

costs, if any, would a uniform

requirement impose?

State Laws

28. Should any new regulation take

into consideration State regulatory

requirements? If so, which

requirements?

Data

29. Do ERISA plans and insurers

maintain statistics on pre-authorization

requests, patient requests for referrals,

claims approvals, denials, appeals and

court challenges? What information is

collected, how is it used, and to whom

is it disclosed?

30. What proportion of preauthorization requests, patient requests

for referrals, and requests for benefits

are denied? What proportion of denials

are appealed? What proportion of

appeals are successful? What proportion

of denied appeals are challenged in

court by those seeking benefits, and

what proportion of court challenges are

successful?

31. What proportion of preauthorization requests, patient requests

for referrals and benefits, and what

proportion of denials, appeals, and

court challenges are associated with

questions of medical necessity, benefit

coverage, out-of-network care, or the

participants’ insured status?

32. What dollar amounts are

associated with pre-authorization

requests, patient requests for referrals,

claims, denials, appeals, and court

challenges?

33. What is the usual timing

associated with pre-authorization

requests, patient requests for referrals,

claims, denials, appeals, and court

challenges?

34. Under Medicare, HCFA has broad

authority to require reporting of

information. Information concerning

appeals and grievances from enrollees

in Medicare managed care arrangements

are collected by the reconsideration

contractor that performs reviews for

HCFA, and are reported to HCFA by

provider and by type of complaint (i.e.,

non-plan practitioner, mental health,

emergency room, inpatient hospital,

etc.). Should ERISA plans be required to

maintain a written log of benefit denials

and benefit reviews for examination by

prospective enrollees? In the alternative,

should ERISA plans be required to

record and make available to claimants

and the Secretary the number of

requests for review or appeals by

claimants and whether the resolution

was favorable or unfavorable to the

claimant? What costs, if any, would

either requirement impose on plans?

Would it be useful and less burdensome

to have uniform reporting requirements

for Medicare, ERISA and State

purposes?

Impact on Small Entities

In responding to the questions above,

please address the anticipated annual

impact of any proposals on small

businesses and small plans (plans with

fewer than 100 participants).

All submitted comments will be made

a part of the record of proceeding

referred to herein and will be available

for public inspection.

Signed at Washington, D.C. this 27th day

of August, 1997.

Olena Berg,

Assistant Secretary for Pension and Welfare

Benefits, U.S. Department of Labor.

[FR Doc. 97–23483 Filed 9–5–97; 8:45 am]

BILLING CODE 4510–29–P