§ 4089a. Mental health care services review

(a) The purposes of this section are to:

(1) promote the delivery of quality mental health care in a cost-effective manner;

(2) foster the practice of mental health services review as a professional collaborative process, the primary objective of which is to enhance the effectiveness of clinical treatment;

(3) protect clients/patients, employers, and mental health care providers by ensuring that review agents are qualified to perform service review activities and to make informed decisions on the appropriateness of mental health care; and

(4) ensure the confidentiality of clients/patients' mental health records in the performance of service review activities in accordance with applicable State and federal laws.

(b) Definitions. As used in this section:

(1) "License" means a review agent's license granted by the Commissioner.

(2) "Mental health care provider" or "mental health care professional" means any person, corporation, facility, or institution certified or licensed by this State to provide mental health care services, including a physician, a nurse with recognized psychiatric specialties, hospital or other health care facility, psychologist, clinical social worker, mental health counselor, alcohol or drug abuse counselor, or an employee or agent of such provider acting in the course and scope of employment or an agency related to mental health care services.

(3) "Mental health care services" mean acts of diagnosis, treatment, evaluation, or advice or any other acts permissible under the health care laws of Vermont whether performed in an outpatient or institutional setting, and include alcohol and drug abuse treatment.

(4) "Review agent" means a person or entity performing service review activities within one year of the date of a fully compliant application for licensure who is either affiliated with, under contract with, or acting on behalf of a business entity in this State and who provides or administers mental health care benefits to members of health benefit plans subject to the Department's jurisdiction, including a health insurer, nonprofit health service plan, health insurance service organization, health maintenance organization, or preferred provider organization, including organizations that rely upon primary care physicians to coordinate delivery of services.

(5) "Service review" means any system for reviewing the appropriate and efficient allocation of mental health care services given or proposed to be given to a patient or group of patients for the purpose of recommending or determining whether such services should be reimbursed, covered, or provided by an insurer, plan, or other entity or person and includes activities of utilization review and managed care, but does not include professional peer review which does not affect reimbursement for or provision of services.

(c) Any person who approves or denies payment, or who recommends approval or denial of payment for mental health care services, or whose review results in approval or denial of payment for mental health services on a case-by-case basis, may not review such services in this State unless the Commissioner has granted the person a review agent's license. On or before January 1, 1995, the Commissioner shall adopt rules to implement the provisions of this section, including the procedures and standards for licensure. The rules shall differentiate between health maintenance organizations licensed to do business within this State and other forms of utilization review. The rules shall establish:

(1) A requirement that within 10 business days after request the review agent make available at no cost to its clients/patients and providers affected by its service review activities, the specific review criteria and standards, credentials of the reviewing professionals, and procedures and methods to be used in evaluating proposed or delivered mental health care services.

(2) A time period within which any determination regarding the provision or reimbursement of mental health services shall be made.

(3) A requirement that any determination regarding mental health care services rendered or to be rendered to a client/patient which may result in a denial of third-party reimbursement or a denial of pre-certification for that service shall include the evaluation, findings, and concurrence of a mental health professional whose training and expertise is at least comparable to that of the treating clinician.

(4) The type, qualifications, and number of personnel required to perform service review activities.

(5) A requirement that a determination by a review agent that care rendered or to be rendered is inappropriate shall not be made until the review agent has communicated with the patient's attending mental health professional concerning that medical care. The review shall be prospective or concurrent with the treatment.

(6) A requirement that any determination that care rendered or to be rendered is inappropriate shall include the written evaluation and findings of the review agent.

(7) A procedure for clients or patients, or both, mental health professionals, or hospitals to seek prompt reconsideration before an independent review organization pursuant to section 4089f of this title of an adverse decision by a review agent. The external reviewer engaged by the independent review organization shall have training and expertise at least comparable to that of the treating clinician.

(8) Policies and procedures to ensure that all applicable State and federal laws to protect the confidentiality of individual mental health records are followed.

(9) Policies and procedures which ensure appropriate notification and concurrence of providers and clients/patients before client/patient interviews are conducted by the review agent.

(10) Prohibition of an agreement between the review agent and a business entity or third-party payor in which payment to the review agent includes an incentive or contingent fee arrangement based on the reduction of mental health care services, reduction of length of stay, reduction of treatment, or treatment setting selected. Nothing in this subdivision shall prohibit capitation arrangements for reimbursement for mental health services. Notwithstanding the foregoing, a clinical decision made by the attending mental health professional regarding continued treatment shall not be construed as a denial of services subject to the provisions of this section.

(d) Reviewing agents shall be subject to the provisions of chapter 129 of this title governing unfair insurance trade practices.

(e) Interim provisions: Review agents who are operating in Vermont prior to the adoption of rules pursuant to this section may continue to conduct review activities until the Commissioner adopts rules and acts upon the application submitted by the review agent. Review agents operating pursuant to this subsection shall file a completed initial application within the time set forth by rule in order to continue operating until a license is granted.

(f) The Commissioner shall have the authority to examine, take administrative action against and penalize review agents as provided in chapters 3, 101, and 129 of this title. A person who violates any provision of this section or who submits any false information in an application required by this section may be fined not more than $5,000.00 for each violation.

(g) [Repealed.]

(h) A review agent shall pay a license fee for the year of registration and a renewal fee for each year thereafter of $200.00. In addition, a review agent shall pay any additional expenses incurred by the Commissioner to examine and investigate an application or an amendment to an application.

(i) The confidentiality of any health care information acquired by or provided to an independent review organization pursuant to section 4089f of this title shall be maintained in compliance with any applicable State or federal laws. Records of, and internal materials prepared for, specific reviews under this section shall be exempt from public inspection and copying under the Public Records Act. (Added 1993, No. 185 (Adj. Sess.), § 1, eff. June 11, 1994; amended 1997, No. 25, § 1, eff. May 28, 1997; 2001, No. 76 (Adj. Sess.), § 2, eff. March 15, 2002; 2011, No. 21, § 14; 2013, No. 79, § 2, eff. June 7, 2013; 2015, No. 23, § 4.)