subparagraph (B), shall be an appropriate 
specialist; 
(ii) has been selected by the plan or 
issuer; and 
(iii) did not make the initial denial in 
the internally appealable decision. 
(B) 
LIMITED
SCOPE
COVERAGE
DE-
FINED.—For purposes of subparagraph (A), the 
term ‘‘limited scope coverage’’ means a group 
health plan or health insurance coverage the 
only benefits under which are for benefits de-
scribed in section 2791(c)(2)(A) of the Public 
Health Service Act (42 U.S.C. 300gg–91(c)(2)). 
(2) TIME LIMITS FOR INTERNAL REVIEWS.— 
(A) IN GENERAL.—Having received such a 
request for review of a denial of claim, the plan 
or issuer shall, in accordance with the medical 
exigencies of the case but not later than the 
deadline specified in subparagraph (B), com-
plete the review on the denial and transmit to 
the participant, beneficiary, enrollee, or other 
person involved a decision that affirms, re-
verses, or modifies the denial. If the decision 
does not reverse the denial, the plan or issuer 
shall transmit, in printed form, a notice that 
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sets forth the grounds for such decision and 
that includes a description of rights to any fur-
ther appeal. Such decision shall be treated as 
the final decision of the plan. Failure to issue 
such a decision by such deadline shall be treat-
ed as a final decision affirming the denial of 
claim. 
(B) DEADLINE.— 
(i) IN GENERAL.—Subject to clauses 
(ii) and (iii), the deadline specified in this 
subparagraph is 14 days after the date of 
receipt of the request for internal review. 
(ii) EXTENSION
PERMITTED
WHERE 
NOTICE OF ADDITIONAL INFORMATION RE-
QUIRED.—If a group health plan or health 
insurance issuer— 
(I) receives a request for internal 
review, 
(II) determines that additional 
information is necessary to complete 
the review and make the determina-
tion on the request, and 
(III) notifies the requester, not 
later than 5 business days after the 
date of receiving the request, of the 
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need for such specified additional in-
formation, 
the deadline specified in this subparagraph 
is 14 days after the date the plan or issuer 
receives the specified additional informa-
tion, but in no case later than 28 days 
after the date of receipt of the request for 
the internal review. This clause shall not 
apply if the deadline is specified in clause 
(iii). 
(iii) EXPEDITED CASES.—In the case 
of a situation described in subsection 
(c)(1)(A), the deadline specified in this 
subparagraph is 72 hours after the time of 
the request for review. 
(c) EXPEDITED REVIEW PROCESS.— 
(1) IN GENERAL.—A group health plan, and a 
health insurance issuer, shall establish procedures in 
writing for the expedited consideration of requests 
for review under subsection (b) in situations— 
(A) in which, as determined by the plan or 
issuer or as certified in writing by a treating 
health care professional, the application of the 
normal timeframe for making a determination 
could seriously jeopardize the life or health of 
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the participant, beneficiary, or enrollee or such 
an individual’s ability to regain maximum func-
tion; or 
(B) described in section 101(d)(2) (relat-
ing to requests for continuation of ongoing care 
which would otherwise be reduced or termi-
nated). 
(2) PROCESS.—Under such procedures— 
(A) the request for expedited review may 
be submitted orally or in writing by an indi-
vidual or provider who is otherwise entitled to 
request the review; 
(B) all necessary information, including 
the plan’s or issuer’s decision, shall be trans-
mitted between the plan or issuer and the re-
quester by telephone, facsimile, or other simi-
larly expeditious available method; and 
(C) the plan or issuer shall expedite the re-
view in the case of any of the situations de-
scribed in subparagraph (A) or (B) of para-
graph (1). 
(3) DEADLINE FOR DECISION.—The decision on 
the expedited review must be made and commu-
nicated to the parties as soon as possible in accord-
ance with the medical exigencies of the case, and in 
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no event later than 72 hours after the time of re-
ceipt of the request for expedited review, except that 
in a case described in paragraph (1)(B), the decision 
must be made before the end of the approved period 
of care. 
(d) WAIVER OF PROCESS.—A plan or issuer may 
waive its rights for an internal review under subsection 
(b). In such case the participant, beneficiary, or enrollee 
involved (and any designee or provider involved) shall be 
relieved of any obligation to complete the review involved 
and may, at the option of such participant, beneficiary, 
enrollee, designee, or provider, proceed directly to seek 
further appeal through any applicable external appeals 
process. 
SEC. 103. EXTERNAL APPEALS PROCEDURES. 
(a) RIGHT TO EXTERNAL APPEAL.— 
(1) IN GENERAL.—A group health plan, and a 
health insurance issuer offering health insurance 
coverage, shall provide for an external appeals proc-
ess that meets the requirements of this section in 
the case of an externally appealable decision de-
scribed in paragraph (2), for which a timely appeal 
is made either by the plan or issuer or by the partic-
ipant, beneficiary, or enrollee (and any provider or 
other person acting on behalf of such an individual 
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with the individual’s consent or without such consent 
if such an individual is medically unable to provide 
such consent). The appropriate Secretary shall es-
tablish standards to carry out such requirements. 
(2) EXTERNALLY APPEALABLE DECISION DE-
FINED.— 
(A) IN GENERAL.—For purposes of this 
section, the term ‘‘externally appealable deci-
sion’’ means a denial of claim for benefits (as 
defined in section 101(f)(2))— 
(i) that is based in whole or in part on 
a decision that the item or service is not 
medically necessary or appropriate or is in-
vestigational or experimental; or 
(ii) in which the decision as to wheth-
er a benefit is covered involves a medical 
judgment. 
(B) INCLUSION.—Such term also includes 
a failure to meet an applicable deadline for in-
ternal review under section 102. 
(C) EXCLUSIONS.—Such term does not in-
clude— 
(i) specific exclusions or express limi-
tations on the amount, duration, or scope 
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of coverage that do not involve medical 
judgment; or 
(ii) a decision regarding whether an 
individual is a participant, beneficiary, or 
enrollee under the plan or coverage. 
(3) EXHAUSTION OF INTERNAL REVIEW PROC-
ESS.—Except as provided under section 102(d), a 
plan or issuer may condition the use of an external 
appeal process in the case of an externally appeal-
able decision upon a final decision in an internal re-
view under section 102, but only if the decision is 
made in a timely basis consistent with the deadlines 
provided under this subtitle. 
(4) FILING FEE REQUIREMENT.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), a plan or issuer may condition the 
use of an external appeal process upon payment 
to the plan or issuer of a filing fee that does 
not exceed $25. 
(B) EXCEPTION
FOR
INDIGENCY.—The 
plan or issuer may not require payment of the 
filing fee in the case of an individual partici-
pant, beneficiary, or enrollee who certifies (in a 
form and manner specified in guidelines estab-
lished by the Secretary of Health and Human 
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Services) that the individual is indigent (as de-
fined in such guidelines). 
(C) REFUNDING FEE IN CASE OF SUCCESS-
FUL APPEALS.—The plan or issuer shall refund 
payment of the filing fee under this paragraph 
if the recommendation of the external appeal 
entity is to reverse or modify the denial of a 
claim for benefits which is the subject of the 
appeal. 
(b) GENERAL ELEMENTS OF EXTERNAL APPEALS 
PROCESS.— 
(1) CONTRACT WITH QUALIFIED EXTERNAL AP-
PEAL ENTITY.— 
(A) CONTRACT REQUIREMENT.—Except as 
provided in subparagraph (D), the external ap-
peal process under this section of a plan or 
issuer shall be conducted under a contract be-
tween the plan or issuer and one or more quali-
fied external appeal entities (as defined in sub-
section (c)). 
(B) LIMITATION ON PLAN OR ISSUER SE-
LECTION.—The applicable authority shall im-
plement procedures— 
(i) to assure that the selection process 
among qualified external appeal entities 
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will not create any incentives for external 
appeal entities to make a decision in a bi-
ased manner, and 
(ii) for auditing a sample of decisions 
by such entities to assure that no such de-
cisions are made in a biased manner. 
(C) OTHER
TERMS
AND
CONDITIONS.— 
The terms and conditions of a contract under 
this paragraph shall be consistent with the 
standards the appropriate Secretary shall estab-
lish to assure there is no real or apparent con-
flict of interest in the conduct of external ap-
peal activities. Such contract shall provide that 
all costs of the process (except those incurred 
by the participant, beneficiary, enrollee, or 
treating professional in support of the appeal) 
shall be paid by the plan or issuer, and not by 
the participant, beneficiary, or enrollee. The 
previous sentence shall not be construed as ap-
plying to the imposition of a filing fee under 
subsection (a)(4). 
(D) STATE
AUTHORITY
WITH
RESPECT 
QUALIFIED
EXTERNAL
APPEAL
ENTITY
FOR 
HEALTH INSURANCE ISSUERS.—With respect to 
health insurance issuers offering health insur-
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ance coverage in a State, the State may provide 
for external review activities to be conducted by 
a qualified external appeal entity that is des-
ignated by the State or that is selected by the 
State in a manner determined by the State to 
assure an unbiased determination. 
(2) ELEMENTS OF PROCESS.—An external ap-
peal process shall be conducted consistent with 
standards established by the appropriate Secretary 
that include at least the following: 
(A) FAIR
AND
DE
NOVO
DETERMINA-
TION.—The process shall provide for a fair, de 
novo determination. However, nothing in this 
paragraph shall be construed as providing for 
coverage of items and services for which bene-
fits are specifically excluded under the plan or 
coverage. 
(B) STANDARD OF REVIEW.—An external 
appeal entity shall determine whether the plan’s 
or issuer’s decision is in accordance with the 
medical needs of the patient involved (as deter-
mined by the entity) taking into account, as of 
the time of the entity’s determination, the pa-
tient’s medical condition and any relevant and 
reliable evidence the entity obtains under sub-
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paragraph (D). If the entity determines the de-
cision is in accordance with such needs, the en-
tity shall affirm the decision and to the extent 
that the entity determines the decision is not in 
accordance with such needs, the entity shall re-
verse or modify the decision. 
(C) CONSIDERATION
OF
PLAN
OR
COV-
ERAGE DEFINITIONS.—In making such deter-
mination, the external appeal entity shall con-
sider (but not be bound by) any language in the 
plan or coverage document relating to the defi-
nitions of the terms medical necessity, medically 
necessary or appropriate, or experimental, in-
vestigational, or related terms. 
(D) EVIDENCE.— 
(i) IN GENERAL.—An external appeal 
entity shall include, among the evidence 
taken into consideration— 
(I) the decision made by the plan 
or issuer upon internal review under 
section 102 and any guidelines or 
standards used by the plan or issuer 
in reaching such decision; 
(II) any personal health and 
medical information supplied with re-
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spect to the individual whose denial of 
claim for benefits has been appealed; 
and 
(III) the opinion of the individ-
ual’s treating physician or health care 
professional. 
(ii) ADDITIONAL
EVIDENCE.—Such 
entity may also take into consideration but 
not be limited to the following evidence (to 
the extent available): 
(I) The results of studies that 
meet professionally recognized stand-
ards of validity and replicability or 
that have been published in peer-re-
viewed journals. 
(II) The results of professional 
consensus conferences conducted or fi-
nanced in whole or in part by one or 
more government agencies. 
(III) 
Practice 
and 
treatment 
guidelines prepared or financed in 
whole or in part by government agen-
cies. 
(IV) Government-issued coverage 
and treatment policies. 
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(V) Community standard of care 
and generally accepted principles of 
professional medical practice. 
(VI) To the extent that the entity 
determines it to be free of any conflict 
of interest, the opinions of individuals 
who are qualified as experts in one or 
more fields of health care which are 
directly related to the matters under 
appeal. 
(VII) To the extent that the enti-
ty determines it to be free of any con-
flict of interest, the results of peer re-
views conducted by the plan or issuer 
involved. 
(E) DETERMINATION CONCERNING EXTER-
NALLY
APPEALABLE
DECISIONS.—A qualified 
external appeal entity shall determine— 
(i) whether a denial of claim for bene-
fits is an externally appealable decision 
(within the meaning of subsection (a)(2)); 
(ii) whether an externally appealable 
decision involves an expedited appeal; and 
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(iii) for purposes of initiating an ex-
ternal review, whether the internal review 
process has been completed. 
(F) 
OPPORTUNITY
TO
SUBMIT
EVI-
DENCE.—Each party to an externally appeal-
able decision may submit evidence related to the 
issues in dispute. 
(G) PROVISION
OF
INFORMATION.—The 
plan or issuer involved shall provide timely ac-
cess to the external appeal entity to information 
and to provisions of the plan or health insur-
ance coverage relating to the matter of the ex-
ternally appealable decision, as determined by 
the entity. 
(H) TIMELY DECISIONS.—A determination 
by the external appeal entity on the decision 
shall— 
(i) be made orally or in writing and, 
if it is made orally, shall be supplied to the 
parties in writing as soon as possible; 
(ii) be made in accordance with the 
medical exigencies of the case involved, but 
in no event later than 21 days after the 
date (or, in the case of an expedited ap-
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peal, 72 hours after the time) of requesting 
an external appeal of the decision; 
(iii) state, in layperson’s language, the 
basis for the determination, including, if 
relevant, any basis in the terms or condi-
tions of the plan or coverage; and 
(iv) inform the participant, bene-
ficiary, or enrollee of the individual’s rights 
(including any limitation on such rights) to 
seek further review by the courts (or other 
process) of the external appeal determina-
tion. 
(I) COMPLIANCE WITH DETERMINATION.— 
If the external appeal entity reverses or modi-
fies the denial of a claim for benefits, the plan 
or issuer shall— 
(i) upon the receipt of the determina-
tion, authorize benefits in accordance with 
such determination; 
(ii) take such actions as may be nec-
essary to provide benefits (including items 
or services) in a timely manner consistent 
with such determination; and 
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(iii) submit information to the entity 
documenting compliance with the entity’s 
determination and this subparagraph. 
(c) QUALIFICATIONS OF EXTERNAL APPEAL ENTI-
TIES.— 
(1) IN GENERAL.—For purposes of this section, 
the term ‘‘qualified external appeal entity’’ means, 
in relation to a plan or issuer, an entity that is cer-
tified under paragraph (2) as meeting the following 
requirements: 
(A) The entity meets the independence re-
quirements of paragraph (3). 
(B) The entity conducts external appeal 
activities through a panel of not fewer than 3 
clinical peers. 
(C) The entity has sufficient medical, legal, 
and other expertise and sufficient staffing to 
conduct external appeal activities for the plan 
or issuer on a timely basis consistent with sub-
section (b)(2)(G). 
(D) The entity meets such other require-
ments as the appropriate Secretary may im-
pose. 
(2) INITIAL CERTIFICATION OF EXTERNAL AP-
PEAL ENTITIES.— 
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(A) IN GENERAL.—In order to be treated 
as a qualified external appeal entity with re-
spect to— 
(i) a group health plan, the entity 
must be certified (and, in accordance with 
subparagraph (B), periodically recertified) 
as meeting the requirements of paragraph 
(1)— 
(I) by the Secretary of Labor; 
(II) under a process recognized 
or approved by the Secretary of 
Labor; or 
(III) to the extent provided in 
subparagraph (C)(i), by a qualified 
private standard-setting organization 
(certified under such subparagraph); 
or 
(ii) a health insurance issuer oper-
ating in a State, the entity must be cer-
tified (and, in accordance with subpara-
graph (B), periodically recertified) as 
meeting such requirements— 
(I) by the applicable State au-
thority (or under a process recognized 
or approved by such authority); or 
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(II) if the State has not estab-
lished a certification and recertifi-
cation process for such entities, by the 
Secretary of Health and Human Serv-
ices, under a process recognized or ap-
proved by such Secretary, or to the 
extent 
provided 
in 
subparagraph 
(C)(ii), by a qualified private stand-
ard-setting 
organization 
(certified 
under such subparagraph). 
(B) RECERTIFICATION PROCESS.—The ap-
propriate Secretary shall develop standards for 
the recertification of external appeal entities. 
Such standards shall include a review of— 
(i) the number of cases reviewed; 
(ii) a summary of the disposition of 
those cases; 
(iii) the length of time in making de-
terminations on those cases; 
(iv) updated information of what was 
required to be submitted as a condition of 
certification for the entity’s performance of 
external appeal activities; and 
(v) such information as may be nec-
essary to assure the independence of the 
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