Appeals court faults health insurer for ignoring authorization requests

March 16, 2009

The Florida District Court of Appeal, First District, found February 27 that an insurance carrier forfeits its right under state law to contest the medical necessity of a request for authorization for referral for medical treatment if the carrier fails to respond to the request.

This material originally appeared in the March 6, 2009, issue of Health Lawyers Weekly, a publication of the American Health Lawyers Association (www.healthlawyers.org).

The Florida District Court of Appeal, First District, found February 27 that an insurance carrier forfeits its right under state law to contest the medical necessity of a request for authorization for referral for medical treatment if the carrier fails to respond to the request. 

Gail Elmer filed suit challenging the decision of the Judge of Compensation Claims (JCC) denying her requests for: (1) authorization for referral to a pain management specialist recommended by her authorized treating physician; (2) an award of palliative care; and (3) attorneys' fees and costs.

The JCC found that defendant, Elmer’s employer and insurance carrier, failed to respond to repeated written requests by Elmer’s treating physician for a referral to a pain management specialist.

The JCC went on to conclude that Elmer was not entitled to a referral because it was not medically necessary.

Elmer challenged the decision, arguing that, pursuant to either section 440.13(3)(d) or (i) of the Florida Statutes (2002), defendant was estopped from arguing the referral was not medically necessary because it failed to timely respond to her doctor’s written referral requests. 

The appeals court noted that section 440.13(3)(d) provides that:

A carrier must respond, by telephone or in writing, to a request for authorization by the close of the third business day after receipt of the request. A carrier who fails to respond to a written request for authorization for referral for medical treatment by the close of the third business day after receipt of the request consents to the medical necessity for such treatment.  

Section 440.13(3)(i) says that a claim for a specialist consultation is not valid and reimbursable “unless the services have been expressly authorized by the carrier, or unless the carrier has failed to respond within 10 days to a written request for authorization, or unless emergency care is required.” 

The appeals court highlighted that defendant did not respond to Elmer’s doctor’s multiple requests for authorization for referral to a pain management specialist within either three or ten business days after receiving them.

“If there is no response, the plain language of statute provides that the [carrier] has consented to the medical necessity of the treatment,” the appeals court said. Thus, defendant has forfeited the right to contest the medical necessity of the referral here.

As a result, it was error for the JCC to deny an authorization for the pain management referral on the ground that it was not medically necessary, the appeals court found.

“Consequently, it was also error to deny Claimant’s request for attorney’s fees and costs for prevailing on this issue,” the appeals court held.

However, the appeals court summarily affirmed the second cause of action-an award of palliative care-finding Elmer failed to preserve the issue.

Elmer v. Southland Corp., No. 1D08-3394 (Fla. Dist. Ct. App. Feb. 27, 2009).