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Q.  Can you please give us a definition of medical necessity?

A.  With a great deal of caution/trepidation/nail-biting, I submit the following as a guide for thinking about the issue:

 First, medical necessity is a clinical judgment, not a definition. “Generally speaking, most definitions of medical necessity incorporate the principle of providing services which are "reasonable and necessary" or "appropriate" in light of clinical standards of practice. The lack of objectivity inherent in these terms often leads to widely varying interpretations by practitioners and payors, which, in turn, can result in service provided not meeting the definition. And last, but not least, the decision as to whether the services were medically necessary is typically made by a payor reviewer who didn’t even see the patient.”  http://www.physiciansnews.com/law/802.miller.html

I will echo the Connecticut Second Circuit Court of Appeals, which has decided numerous cases in which medical necessity is mentioned. They described what the term means, saying “unless the contrary is specified, the term “medical necessity” must refer to what is medically necessary for a particular patient, and hence entails an individual assessment rather than a general determination of what works in the ordinary case. ” http://www.cga.ct.gov/2007/rpt/2007-r-0055.htm

Since, in the North Carolina school-based occupational therapy context, the Medicaid LEA Policy states:

3.2 Specific Criteria

“Service is covered when it is medically necessary and is outlined in an IEP/IFSP. All services must be medically necessary as defined by the policy guidelines (national standards, best practice guidelines, etc.) recommended by the authoritative bodies for each discipline and are outlined in an IEP/IFSP.”

And AOTA state that:

“This is the definition of medical necessity that has been supported by the Consortium for Citizens for Disabilities (CCD) for many years. AOTA is a member of CCD and a leader in its Health Task Force:

The CCD believes that a federal definition of medical necessity should require plans to cover services that are: calculated to prevent, diagnose, correct, or ameliorate a physical or mental condition that threatens life, causes pain or suffering, or results in illness, disability, or infirmity; calculated to maintain or preclude deterioration of health or functional ability; individualized, specific, and consistent with symptoms or confirmed diagnosis of the illness, disability, or injury under treatment; not in excess of the individual's needs; necessary and consistent with generally accepted professional medical standards as determined by the Secretary of Health and Human Services or the state Department of Health; and reflective of the level of service that can be safely provided and for which no equally effective treatment is available. http://www.aota.org/Practitioners/Advocacy/Federal/Reform/Essential-Benefits.aspx?FT=.pdf

Then, an OT practitioner working in schools would need to assess each intervention session, using their own clinical reasoning, to determine if the session, in whole or part, met the following standards:

1) The intervention was designed to prevent, diagnose, correct, or ameliorate a physical or mental condition that threatens life, causes pain or suffering, or results in illness, disability, or infirmity

2) The intervention was designed to maintain or preclude deterioration of health or functional ability

3) The intervention was individualized, specific, and consistent with symptoms or confirmed diagnosis of the illness, disability, or injury for which the student is being served at school

4) The intervention is not in excess of the student’s needs as identified in the IEP

5) The intervention was necessary and consistent with generally accepted professional standards

6) The intervention was designed reflective of the level of service that can be safely provided and for which no equally effective treatment is available

To be clear, these guidelines apply only AFTER the standards for educational relevance have been met. Services provided in schools are primarily concerned the student’s educational (e.g., academic and functional) progress.  Consideration of medical necessity in school-based is conducted mostly in hindsight, rather than in intervention planning, and should never alter scope of service described in the student’s IEP.  

Have a question?Send an email to lauren_holahan@med.unc.edu