7100, Managed Care Organization Procedures

Revision 22-3; Effective Dec. 1, 2022

The managed care organization (MCO) must develop, implement and maintain a member complaint and appeal system that complies with the requirements in applicable federal and state laws and regulations, including 42 Code of Federal Regulations (CFR) Section 431.200, 42 CFR Part 438 Subpart F, Grievance System, and the provisions of 1 Texas Administrative Code Chapter 357, relating to Medicaid MCOs.

The MCO's complaint and appeal system must include:

  • a complaint process;
  • an internal appeal process; and
  • access to the Texas Health and Human Services Commission fair hearing process.

7110 Managed Care Organization Complaint Procedures

Revision 22-3; Effective Dec. 1, 2022

The Texas Health and Human Services Commission's (HHSC) STAR Kids Contract, Attachment A, defines a complaint as "an expression of dissatisfaction expressed by a Complainant, orally or in writing to the managed care organization (MCO), about any matter related to the MCO other than an action. As provided by 42 C.F.R. Section 438.400, possible subjects for complaints include the quality of care of services provided, aspects of interpersonal relationships such as rudeness of a provider or employee, or failure to respect the Medicaid member’s rights."

The complaint procedure does not apply to situations described in "Appeal Procedures."

When members want to file a complaint, they must first contact the MCO, following procedures specified in the MCO's member handbook. The MCO must provide designated member advocates to:

  • assist members in using the complaint system:
  • assist members in writing or filing a complaint; and
  • monitor the complaint throughout the process until the issue is resolved.

In addition to filing complaints with the MCO, a STAR Kids member may file complaints with the state of Texas. If a STAR Kids member contacts the MCO or any HHSC employee with a complaint about an agency licensed by HHSC, or any other state agency, the member is referred to 800-458-9858 to file a regulatory complaint. If the complaint is initially received by HHSC, HHSC informs the MCO of the complaint.

Members may also contact the HHSC Ombudsman's Managed Care Assistance Team for assistance filing a complaint not related to licensure issues.

7120 Managed Care Organization Internal Appeal Procedures

Revision 22-3; Effective Dec. 1, 2022

The Texas Health and Human Services Commission (HHSC) STAR Kids Contract, Attachment A, defines an appeal as the formal process that a member or his or her authorized representative requests a review of the managed care organization’s (MCO’s) action. An action is:

  • the denial or limited authorization of a requested Medicaid service, including the type or level of service;
  • the reduction, suspension or termination of a previously authorized service not caused by loss of eligibility;
  • denial in whole or in part of payment for service;
  • failure to provide services in a timely manner;
  • failure of an MCO to act within the time frames set forth in the contract and 42 Code of Federal Regulations (CFR) Section 438.408(b); or
  • for a resident of a rural area with only one MCO, the denial of a Medicaid member's request to obtain services outside of the network.

The member may file an internal appeal by contacting the MCO after the procedures specified in the MCO's member handbook. The MCO is contractually required to regard any oral or written expression of dissatisfaction or disagreement related to the actions listed above as an appeal. The MCO must provide a designated member advocate to assist the member in filing an appeal. The advocate must also assist members or authorized representatives by monitoring the appeal throughout the process until the issue is resolved.

During the internal appeal process, the MCO must provide the member or an authorized representative a reasonable opportunity to present evidence and any allegations of fact or law in person, as well as in writing. The MCO must inform the member or the authorized representative of the time available for providing this information.

The MCO must provide the member and his or her authorized representative the opportunity, before and during the appeal process, to examine the member's case file, including medical records and any other documents considered during the appeal process.

As required by 42 CFR Section 438.420, the MCO must continue the individual's benefits pending the outcome of the internal appeal if all the following criteria are met:

  • The member or his or her authorized representative files the internal appeal timely, as defined in the STAR Kids contract.
  • The appeal involves the termination, suspension or reduction of a previously authorized course of treatment.
  • The services were ordered by an authorized provider.
  • The original period covered by the original authorization has not expired.
  • The member requests an extension of the benefits.

7121 Expedited Managed Care Organization Internal Appeals

Revision 22-3; Effective Dec. 1, 2022

Per 42 Code of Federal Regulations Section 438.410 and STAR Kids Contract, Attachment B-1, Section 8.1.29.3, the managed care organization (MCO) must establish and maintain an expedited review process for service-related internal appeals when the MCO determines (for a request from a member) or the provider indicates (in making the request on the member’s behalf or supporting the member’s request) that taking the time for a standard resolution could seriously jeopardize the member’s life or health. The MCO must follow all internal appeal requirements for standard member internal appeals as set forth in the STAR Kids contract, Attachment B-1, Section 8.1.29.2, except where differences are specifically noted. The MCO must accept oral or written requests for expedited internal appeals.

After the MCO receives a request for an expedited internal appeal, the MCO must notify the member or his or her authorized representative of the outcome of the expedited internal appeal request within 72 hours. However, the MCO must complete investigation and resolution of an internal appeal relating to an ongoing emergency or denial of continued hospitalization:

  • per the medical or dental immediacy of the case; and
  • not later than one business day after receiving the member's request for an expedited internal appeal.

Members must exhaust the MCO’s expedited internal appeal process before making a request for an expedited State Fair Hearing.

Except for an internal appeal relating to an ongoing emergency or denial of continued hospitalization, the time frame for notifying the member of the outcome of the expedited internal appeal may be extended up to 14 calendar days if the member requests an extension or the MCO shows (to the satisfaction of the Texas Health and Human Services Commission (HHSC), upon HHSC’s request) there is a need for more information and how the delay is in the member’s interest. If the time frame is extended, the MCO must give the member written notice of the reason for delay if the member did not request the delay.

If the determination is adverse to the member, the MCO must follow the procedures relating to the notice in the STAR Kids Contract, Attachment B-1, Section 8.1.29.5. The MCO is responsible for notifying the member of his or her right to access a State Fair Hearing from HHSC. The MCO is responsible for providing documentation to the state and the member, indicating how the determination was made, before the HHSC’s fair hearing.

The MCO is prohibited from discriminating or taking punitive action against a member or his or her representative for requesting an expedited internal appeal. The MCO must ensure that punitive action is not taken against a provider who requests an expedited resolution or supports a member’s request.

If the MCO denies a request for expedited resolution of an internal appeal, the MCO must:

  • transfer the appeal to the time frame for standard internal resolution; and
  • make a reasonable effort to give the member prompt oral notice of the denial, and follow up within two calendar days with a written notice.