States have say in Medicaid medical necessity decisions

Physicians do not have the only say in determining medically necessary treatment for children on Medicaid, according to a recent federal appeals ruling. The state also has a role in determining appropriate limits on Medicaid services, based on such factors as medical necessity and utilization controls, an 11th U.S. Circuit Court of Appeals panel said.

The April 24 decision stemmed from a case in which the physician for 12-year-old Anna C. Moore, who has severe disabilities following an in utero stroke, prescribed 94 hours per week of private skilled nursing. But Georgia's Dept. of Community Health approved only 84 hours, claiming it had the right to limit the care.

Moore's family sued the department, alleging it violated a requirement under the Medicaid Act that states cover early and periodic screening, diagnostic, and treatment services needed to "correct or ameliorate" a child's condition. In the most recent decision, the 11th Circuit reversed a 2008 federal trial court decision in Moore v. Medows finding the state did not have the authority to deny coverage for care the patient's treating physician deemed necessary.

The case attracted national attention from the physician community and various state health regulators, who filed opposing friend-of-the-court briefs on the issue.

Some doctors agree that Medicaid coverage decisions should be a joint effort.

"But we don't see that happening and instead, we find that Medicaid [officials] arbitrarily make their decisions ... predominantly for economic reasons and override [doctors'] medical judgment and limit what they are going to provide," said pediatric cardiologist Louis B. St. Petery Jr., MD. He is executive vice president of the Florida Pediatric Society, which filed a brief in the Georgia case, as did several health and patient advocacy organizations.

"That's a very dangerous policy for Medicaid children ... [who] are supposed to have the same access to health care as children who are privately insured," Dr. St. Petery said.

In an opposing brief, health care administrators in Florida and Alabama argued that federal law gives states "significant discretion ... [to] tailor and define their Medicaid programs to exclude unproven, ineffective ... procedures, as well as services that are purely for a recipient's convenience." The regulators called the trial court ruling overbroad, saying it left states "at the whim of individual physicians." The 11th Circuit decision encompasses Alabama, Florida and Georgia.

The Florida Pediatric Society has sued state health officials over a similar issue. That case is expected to go to trial in August.