[Code of Federal Regulations] [Title 42, Volume 3] [Revised as of October 1, 2004] From the U.S. Government Printing Office via GPO Access [CITE: 42CFR456.1] [Page 324-328] TITLE 42--PUBLIC HEALTH CHAPTER IV--CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES (CONTINUED) PART 456_UTILIZATION CONTROL--Table of Contents Subpart A_General Provisions Sec. 456.1 Basis and purpose of part. Subpart A_General Provisions Sec. 456.1 Basis and purpose of part. 456.2 State plan requirements. 456.3 Statewide surveillance and utilization control program. 456.4 Responsibility for monitoring the utilization control program. 456.5 Evaluation criteria. 456.6 Review by State medical agency of appropriateness and quality of services. Subpart B_Utilization Control: All Medicaid Services 456.21 Scope. 456.22 Sample basis evaluation of services. 456.23 Post-payment review process. Subpart C_Utilization Control: Hospitals 456.50 Scope. 456.51 Definitions. Certification of Need for Care 456.60 Certification and recertification of need for inpatient care. Plan of Care 456.80 Individual written plan of care. Utilization Review (UR) Plan: General Requirement 456.100 Scope. 456.101 UR plan required for inpatient hospital services. UR Plan: Administrative Requirements 456.105 UR committee required. 456.106 Organization and composition of UR committee; disqualification from UR committee membership. UR Plan: Informational Requirements 456.111 Recipient information required for UR. 456.112 Records and reports. 456.113 Confidentiality. UR Plan: Review of Need for Admission 456.121 Admission review required. 456.122 Evaluation criteria for admission review. 456.123 Admission review process. 456.124 Notification of adverse decision. 456.125 Time limits for admission review. 456.126 Time limits for final decision and notification of adverse decision. 456.127 Pre-admission review. 456.128 Initial continued stay review date. 456.129 Description of methods and criteria: Initial continued stay review date; close professional scrutiny; length of stay modification. UR Plan: Review of Need for Continued Stay 456.131 Continued stay review required. 456.132 Evaluation criteria for continued stay. 456.133 Subsequent continued stay review dates. [[Page 325]] 456.134 Description of methods and criteria: Subsequent continued stay review dates; length of stay modification. 456.135 Continued stay review process. 456.136 Notification of adverse decision. 456.137 Time limits for final decision and notification of adverse decision. UR Plan: Medical Care Evaluation Studies 456.141 Purpose and general description. 456.142 UR plan requirements for medical care evaluation studies. 456.143 Content of medical care evaluation studies. 456.144 Data sources for studies. 456.145 Number of studies required to be performed. Subpart D_Utilization Control: Mental Hospitals 456.150 Scope. 456.151 Definitions. Certification of Need for Care 456.160 Certification and recertification of need for inpatient care. Medical, Psychiatric, and Social Evaluations and Admission Review 456.170 Medical, psychiatric, and social evaluations. 456.171 Medicaid agency review of need for admission. Plan of Care 456.180 Individual written plan of care. 456.181 Reports of evaluations and plans of care. Utilization Review (UR) Plan: General Requirement 456.200 Scope. 456.201 UR plan required for inpatient mental hospital services. UR Plan: Administrative Requirements 456.205 UR committee required. 456.206 Organization and composition of UR committee; disqualification from UR committee membership. UR Plan: Informational Requirements 456.211 Recipient information required for UR. 456.212 Records and reports. 456.213 Confidentiality. UR Plan: Review of Need for Continued Stay 456.231 Continued stay review required. 456.232 Evaluation criteria for continued stay. 456.233 Initial continued stay review date. 456.234 Subsequent continued stay review dates. 456.235 Description of methods and criteria: Continued stay review dates; length of stay modification. 456.236 Continued stay review process. 456.237 Notification of adverse decision. 456.238 Time limits for final decision and notification of adverse decision. UR Plan: Medical Care Evaluation Studies 456.241 Purpose and general description. 456.242 UR plan requirements for medical care evaluation studies. 456.243 Content of medical care evaluation studies. 456.244 Data sources for studies. 456.245 Number of studies required to be performed. Subpart E [Reserved] Subpart F_Utilization Control: Intermediate Care Facilities 456.350 Scope. 456.351 Definition. Certification of Need for Care 456.360 Certification and recertification of need for inpatient care. Medical, Psychological, and Social Evaluations and Admission Review 456.370 Medical, psychological, and social evaluations. 456.371 Exploration of alternative services. 456.372 Medicaid agency review of need for admission. Plan of Care 456.380 Individual written plan of care. 456.381 Reports of evaluations and plans of care. Utilization Review (UR) Plan: General Requirement 456.400 Scope. 456.401 State plan UR requirements and options; UR plan required for intermediate care facility services. UR Plan: Administrative Requirements 456.405 Description of UR review function: How and when. 456.406 Description of UR review function: Who performs UR; disqualification from performing UR. 456.407 UR responsibilities of administrative staff. UR Plan: Informational Requirements 456.411 Recipient informtion required for UR. [[Page 326]] 456.412 Records and reports. 456.413 Confidentiality. UR Plan: Review of Need for Continued Stay 456.431 Continued stay review required. 456.432 Evaluation criteria for continued stay. 456.433 Initial continued stay review date. 456.434 Subsequent continued stay review dates. 456.435 Description of methods and criteria: Continued stay review dates. 456.436 Continued stay review process. 456.437 Notification of adverse decision. 456.438 Time limits for notification of adverse decision. Subpart G_Inpatient Psychiatric Services for Individuals Under Age 21: Admission and Plan of Care Requirements 456.480 Scope. 456.481 Admission certification and plan of care. 456.482 Medical, psychiatric, and social evaluations. Subpart H_Utilization Review Plans: FFP, Waivers, and Variances for Hospitals and Mental Hospitals 456.500 Purpose. 456.501 UR plans as a condition for FFP. UR Plan: Waiver of Requirements 456.505 Applicability of waiver. 456.506 Waiver options for Medicaid agency. 456.507 Review and granting of waiver requests. 456.508 Withdrawal of waiver. UR Plan: Remote Facility Variances from Time Requirements 456.520 Definitions. 456.521 Conditions for granting variance requests. 456.522 Content of request for variance. 456.523 Revised UR plan. 456.524 Notification of Administrator's action and duration of variance. 456.525 Request for renewal of variance. Subpart I_Inspections of Care in Intermediate Care Facilities and Institutions for Mental Diseases 456.600 Purpose. 456.601 Definitions. 456.602 Inspection team. 456.603 Financial interests and employment of team members. 456.604 Physician team member inspecting care of recipients. 456.605 Number and location of teams. 456.606 Frequency of inspections. 456.607 Notification before inspection. 456.608 Personal contact with and observation of recipients and review of records. 456.609 Determinations by team. 456.610 Basis for determinations. 456.611 Reports on inspections. 456.612 Copies of reports. 456.613 Action on reports. 456.614 Inspections by utilization review committee. Subpart J_Penalty for Failure To Make a Satisfactory Showing of An Effective Institutional Utilization Control Program 456.650 Basis, purpose, and scope. 456.651 Definitions. 456.652 Requirements for an effective utilization control program. 456.653 Acceptable reasons for not meeting requirements for annual on- site review. 456.654 Requirements for content of showings and procedures for submittal. 456.655 Validation of showings. 456.656 Reductions in FFP. 456.657 Computation of reductions in FFP. Subpart K_Drug Use Review (DUR) Program and Electronic Claims Management System for Outpatient Drug Claims 456.700 Scope. 456.702 Definitions. 456.703 Drug use review program. 456.705 Prospective drug review. 456.709 Retrospective drug use review. 456.711 Educational program. 456.712 Annual report. 456.714 DUR/surveillance and utilization review relationship. 456.716 DUR Board. 456.719 Funding for DUR program. 456.722 Electronic claims management system. 456.725 Funding of ECM system. Authority: Sec. 1102 of the Social Security Act (42 U.S.C. 1302), unless otherwise noted. Source: 43 FR 45266, Sept. 29, 1978, unless otherwise noted. (a) This part prescribes requirements concerning control of the utilization of Medicaid services including-- (1) A statewide program of control of the utilization of all Medicaid services; and (2) Specific requirements for the control of the utilization of Medicaid services in institutions. (3) Specific requirements for an outpatient drug use review program. [[Page 327]] (b) The requirements in this part are based on the following sections of the Act. Table 1 shows the relationship between these sections of the Act and the requirements in this part. (1) Methods and procedures to safeguard against unnecessary utilization of care and services. Section 1902(a)(30) requires that the State plan provide methods and procedures to safeguard against unnecessary utilization of care and services. (2) Penalty for failure to have an effective program to control utilization of institutional services. Section 1903(g)(1) provides for a reduction in the amount of Federal Medicaid funds paid to a State for long-stay inpatient services if the State does not make a showing satisfactory to the Secretary that it has an effective program of control over utilization of those services. This penalty provision applies to inpatient services in hospitals, mental hospitals, and intermediate care facilities (ICF's). Specific requirements are: (i) Under section 1903(g)(1)(A), a physician must certify at admission, and a physician (or physician assistant or nurse practitioner under the supervision of a physician) must periodically recertify, the individual's need for inpatient care. (ii) Under section 1903(g)(1)(B), services must be furnished under a plan established and periodically evaluated by a physician. (iii) Under section 1903(g)(1)(C), the State must have in effect a continuous program of review of utilization of care and services under section 1902(a)(30) whereby each admission is reviewed or screened in accordance with criteria established by medical and other professional personnel. (iv) Under section 1903(g)(1)(D), the State must have an effective program under sections 1902(a) (26) and (31) of review of care in intermediate care facilities and mental hospitals. This must include evaluation at least annually of the professional management of each case. (3) Medical review in mental hospitals. Section 1902(a)(26)(A) requires that the plan provide for a program of medical review that includes a medical evaluation of each individual's need for care in a mental hospital, a plan of care, and, where applicable, a plan of rehabilitation. (4) Independent professional review in intermediate care facilities. Section 1902(a)(31)(A) requires that the plan provide for a program of independent professional review that includes a medical evaluation of each individual's need for intermediate care and a written plan of service. (5) Inspection of care and services in institutions. Sections 1902(a)(26) (B) and (C) and 1902(a)(31) (B) and (C) require that the plan provide for periodic inspections and reports, by a team of professional persons, of the care being provided to each recipient in institutions for mental diseases (IMD's), and ICF's participating in Medicaid. (6) Denial of FFP for failure to have specified utilization review procedures. Section 1903(i)(4) provides that FFP is not available in a State's expenditures for hospital or mental hospital services unless the institution has in effect a utilization review plan that meets Medicare requirements. However, the Secretary may waive this requirement if the Medicaid agency demonstrates to his satisfaction that it has utilization review procedures superior in effectiveness to the Medicare procedures. (7) State health agency guidance on quality and appropriateness of care and services. Section 1902(a)(33)(A) requires that the plan provide that the State health or other appropriate medical agency establish a plan for review, by professional health personnel, of the appropriateness and quality of Medicaid services to provide guidance to the Medicaid agency and the State licensing agency in administering the Medicaid program. (8) Drug use review program. Section 1927(g) of the Act provides that, for payment to be made under section 1903 of the Act for covered outpatient drugs, the State must have in operation, by not later than January 1, 1993, a drug use review (DUR) program. It also requires that each State provide, either directly or through a contract with a private organization, for the establishment of a DUR Board. [[Page 328]] Table 1 [This table relates the regulations in this part to the sections of the Act on which they are based.] Subpart A--General........................ 1902(a)(30) 1902(a)(33)(A) Subpart B--Utilization Control: All 1902(a)(30) Medicaid Services. Subpart C--Utilization Control: Hospitals Certification of need for care.......... 1903(g)(1)(A) Plan of care............................ 1903(g)(1)(B) Utilization review plan (including 1902(a)(30) admission review). 1903(g)(1)(C) 1903(i)(4) Subpart D--Utilization Control: Mental Hospitals Certification of need for care.......... 1903(g)(1)(A) Medical evaluation and admission review. 1902(a)(26)(A) 1903(g)(1)(C) Plan of care............................ 1902(a)(26)(A) 1903(g)(1)(B) Admission and plan of care requirements 1902(a)(26)(A) for individuals under 21. 1903(g)(1) (B), (C) Utilization review plan................. 1902(a)(30) 1903(g)(1)(C) 1903(i)(4) Subpart F--Utilization Control: Intermediate Care Facilities Certification of need for care.......... 1903(g)(1)(A) Medical evaluation and admission review. 1902(a)(31)(A) 1903(g)(1)(C) Plan of care............................ 1902(a)(31)(A) 1903(g)(1)(B) Utilization review plan................. 1902(a)(30) 1903(g)(1)(C) 1903(i)(4) Subpart G--Inpatient Psychiatric Services 1905 (a)(16) and (h) for Individuals Under Age 21: Admission and Plan of Care Requirements. Subpart H--Utilization Review Plans: FFP, ............................ Waivers, and Variances for Hospitals and Mental Hospitals.. Subpart I--Inspections of Care in ............................ Intermediate Care Facilities and Institutions for Mental Diseases.. Subpart J--Penalty for Failure To Make a 1903(g) Satisfactory Showing of An Effective Institutional Utilization Control Program. Subpart K--Drug Use Review (DUR) Program 1927(g) and (h) and Electronic Claims Management System for Outpatient Drug Claims. ------------------------------------------------------------------------ [43 FR 45266, Sept. 29, 1978, as amended at 46 FR 48561, Oct. 1, 1981; 57 FR 49408, Nov. 2, 1992; 61 FR 38398, July 24, 1996]