What does “medically necessary” and “medical necessity” mean?

A service is “medically necessary” or a “medical necessity” when it is reasonable and necessary to protect life, to prevent significant illness or significant disability, or to alleviate severe pain.  (2014 ACA Sample EOC Page 166) CA WIC  §14059.5

Medically Necessary shall mean health care services that a Physician, exercising professional clinical judgment, would provide to a patient for the purpose of preventing, evaluating, diagnosing or treating an illness, injury, disease or its symptoms, and that are:

In accordance with generally accepted standards of medical practice, Illinois Dept of Insurance Definition

CIGNA’s Definition

The Five Dimensions of the Medical Necessity Definition

  • The contractual scope of coverage: whether proposed treatment is explicitly included or excluded in the health plan contract
  • Whether the proposed treatment is consistent with professional standards of practice
  • Patient safety and setting of the treatment
  • Whether the treatment is medical in nature or for the convenience of the health professional or patient and family
  • Treatment cost     samhsa.gov

most definitions incorporate the principle of providing services which are “reasonable and necessary” or “appropriate” in light of clinical standards of practice

Medicare defines “medical necessity” as services or items reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member. Glossary Meeicare.Gov   

The Criteria (Clinical UM – Utilization Management)
for establishing the medical necessity of a service:

The service is appropriate for symptoms, diagnosis, and treatment of a condition, illness, or injury; provided for diagnosis, direct care, or treatment; in accordance with the standards of good medical practice; not primarily for the convenience of the member or member’s provider; the most appropriate supply or level of service that can be safely provided to the member. samhsa.gov/

Clinically appropriate, in terms of type, frequency, extent, site and duration, and considered effective for the patient’s illness, injury or disease, and Not primarily for the convenience of the patient, Physician or other health care provider, and not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of that patient’s illness, injury or disease.

For these purposes, generally accepted standards of medical practice means standards that are based on credible scientific evidence published in peer-reviewed medical literature generally recognized by the relevant medical community, Physician specialty society recommendations and the views of Physicians practicing in relevant clinical areas and any other relevant factors. Blue Cross ppo_30_eoc Page 108

Visit our HSA page for Federal Definition of Medical Expenses

Oscar  Clinical Guidelines

Appear to be in Plain English!


  • Noninvasive Positive Pressure Ventilation (CG003) English PDF
  • Oxygen Therapy (CG005) English PDF
  • Hospital Beds and Accessories (CG006) English PDF
  • Pressure-Reducing Support Surfaces (CG007) English PDF
  • Bariatric Surgery (Adults) (CG008) English PDF
  • Bariatric Surgery (Adolescents) (CG009) English PDF
  • Medical Nutrition Therapy (CG010) English PDF
  • Oral Liquid Nutritional Supplements (CG011) English PDF
  • Non-Covered #Experimental, Investigational, and Unproven Services (CG012) English PDF
  • Acupuncture (CG013) English PDF
  • Hyperbaric Oxygen Therapy (CG014) English PDF
  • Treatment and Removal of Benign Skin Lesions (CG015) English PDF
  • Sex Reassignment Surgery (Gender Affirmation Surgery) (CG017) English PDF
  • Balloon Ostial Dilation (CG018)
  • Wearable Cardioverter-Defibrillator Devices (CG019)
  • Home Care – Skilled Nursing Care (RN, LVN/LPN) (CG020) English PDF
  • Home Care – Physical Therapy (PT) and Occupational Therapy (OT) (CG021) English PDF
  • Home Care – Home Health Aides (HHA) (CG022) English PDF
  • Home Care – Speech Language Pathology (SLP) Services (CG023) English PDF
  • Colorectal Cancer Screening (CG024) English PDF
  • Optical Coherence Tomography (OCT) (CG025) English PDF
  • Autonomic Testing (CG026) English PDF
  • Breast Imaging (CG027) English PDF
  • Diabetes Equipment and Supplies (CG028) English PDF
  • Insulin Delivery Systems and Continuous Glucose Monitoring (CG029) English PDF
  • Bioengineered Skin and Soft Tissue Substitutes (CG030) English PDF
  • BPH Treatment (CG031) English PDF
  • Ambulatory Cardiac Event Monitoring (CG032) English PDF
  • Botulinum Toxin (CG033) English PDF
  • Glaucoma Surgery (CG034) English PDF
  • Transcranial Doppler (CG035) English PDF
  • Breast Procedures (CG036) English PDF
  • Erectile Dysfunction (CG037) English PDF
  • Home Births (CG038) English PDF
  • Contact Lenses and Eyeglasses (CG039) English PDF
  • Potentially Preventable Hospital Readmissions (CG040) English PDF
  • Anesthesia and Sedation in Endoscopy (CG041) English PDF
  • Skilled Nursing Facility Care (CG042) English PDF
  • Prenatal Testing (CG043) English PDF
  • Outpatient Physical Therapy & Occupational Therapy (CG044) English PDF


Medical Policies & Clinical UM Guidelines

How do I find a code.com ICD 9, 10, DRG, CPT, (Current Procedural Terminology) diagnosis code, Medical Billing,  coding

Utilization Review


Excerpt from Insurance Policy – EOC Evidence of Coverage

The Benefits of this Plan are provided only for Services which are Medically Necessary as defined in this section.

Services which are Medically Necessary include only those which have been established as safe and effective, are furnished under generally accepted professional standards to treat illness, injury or medical condition, and which are:

Consistent with the Plan’s medical policy;

Consistent with the symptoms or diagnosis;

Not furnished primarily for the convenience of the patient, the attending Physician or other provider; and

Furnished at the most appropriate level which can be provided safely and effectively to the patient.


If there are two (2) or more Medically Necessary Services that may be provided for the illness, injury, or medical condition, Blue Shield Life will provide benefits based on the most cost-effective Service.


Hospital Inpatient Services which are Medically Necessary include only those Services which satisfy the above requirements, require the acute bed-patient (overnight) setting, and which could not have been provided in the Physician’s office, the Outpatient department of a Hospital, or in another lesser facility without adversely affecting the patient’s condition or the quality of medical care rendered. Inpatient services not Medically Necessary include hospitalization:

For diagnostic studies that could have been provided on an Outpatient basis;

For medical observation or evaluation;

For personal comfort;

In a pain management center to treat or cure chronic pain; and

For Inpatient Rehabilitation that can be provided on an Outpatient basis. Copied from Blue Shield EOC 

Milliman Waste Study

The U.S. healthcare system wastes close to three-quarters of a trillion dollars a year—and the implications are not just financial. Many of the tests, treatments, and procedures that comprise healthcare waste can expose patients to undue physical, emotional, or financial harm.  http://www.milliman.com/waste

Top 10 Wasteful Services

10 wasteful procedures health


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Independent Medical #Review (IMR) Program


An Independent Medical Review (IMR) is where expert independent medical professionals review specific medical decisions made by the insurance company. The California Department of Insurance (CDI) administers an Independent Medical Review program that enables you, the insured, to request an impartial appraisal of medical decisions within certain guidelines as specified by the law.

An IMR can be requested only if the insurance company’s decision involves:

It is important to note that the IMR process cannot be used for an insurance company decision that is based on a coverage issue. Only decisions regarding a disputed health care service, as it relates to the practice of medicine, that do not involve a coverage issue are qualified for the IMR program.

You are required to exhaust the internal appeals/grievance process of your particular insurance company before applying for an IMR with the CDI.  Click here to read full article on Department of Insurance Website

California Health Care Foundation on IMR The California Department of Managed Health Care (DMHC)  The DMHC regulates HMOs and some PPOs in California  – Try using the Insurance Company procedure first

Complaint Form &  IMR


[email protected]

Contact Form

CA Department of Insurance  

IMR – Independent Medical Review  

ONLINE complaint form insurance.ca.gov/complain 

Fillable Claim Form

Sections 10169 through 10169.5 of the California Insurance Code (CIC), which became effective January 1, 2001, explain the IMR process in detail. In addition, Section 10145.3 explains the IMR process as it relates to experimental or investigational therapies.

More Links & Resources

Magellan Mental Health 

Policy Statement

Magellan* provides procedures for the expeditious processing of requests for external appeal of adverse determinations through an Independent Review Organization as required by applicable law or customer contract.


To establish standards to assure independent and timely review of disputed health care services to assure that appropriate, beneficial treatment interventions are made available to members. Magellan Mental Health  

CA Department of Insurance

Independent Medical Review (IMR) Program

Blue Shield allegation from DOI on Medical Necessity 


National Health Law Program 
12 page pdf on Internal Grievances & External Review in Service Denials in Covered CA Plans 



Read our other clients testimonials and/or

write one 

Read and or write a testimonial

Specimen EOC Evidence of Coverage – Appeals – Grievances


Resources – Links 

Big Fines! —  In August 2012, DMHC issued a cease-and-desist order against Accountable Health for allegedly conducting illegal utilization reviews and making medical necessity decisions for insurers. DMHC accused the group’s vice president and another employee of engaging in utilization reviews on behalf of nine health plans, even though the employees are not licensed physicians.

Learn More  CA Health Line 9.10.2015



  1. See 42 U.S.C. § 1395y(a)(1)(A)
  2. See http://www.cms.hhs.gov/mcd/overview.asp
  3. For more information, see Certificate of medical necessity

External links

Kantor & Kantor Law Firm   

scott glovsky.com/medical-necessity-denials

10 comments on “Medical Necessity – reasonable and necessary Independent Medical Review

  1. 8 comments on “Independent Medical Review”

    1. Anonymous says:

      What would be the appropriate venue for a Knox Keene Violation involving a disabled child.

      We are enrolled in a locally governed managed medical plan & no one seems to understand that it always applies to a disabled child.

      We passed IMR.

      They took away my kids best treatment.

  2. I have cancer and want to try an experimental drug.

    Can I get that in the USA?

    Will my Insurance pay for it?

    • This is something you will have to have your doctors office review with the insurance companies.

      Is Liposuction Covered by Health Insurance?

      Usually liposuction is not covered by health insurance. Because liposuction is a cosmetic surgical procedure it is not covered by medical insurance unless it has some therapeutic benefit. Female breast reduction surgery is often covered by insurance because surgical breast reduction often relieves chronic pain of the back and shoulders. When female breast reduction is accomplished by tumescent liposuction, insurance may reimburse the patient a portion of the liposuction surgical fees. Similarly, sometimes health insurance will cover liposuction for the treatment of subcutaneous lipomas (small fatty tumors just beneath the skin). Liposuction.com

      Liposuction may also be used to treat certain medical conditions, including:

      Benign fatty tumors (lipomas).
      Abnormal enlargement of the male breasts (gynecomastia or pseudogynecomastia).
      Problems with metabolism of fat in the body (lipodystrophy).
      Excessive sweating in the armpit area (axillary hyperhidrosis).
      Liposuction is not used to treat obesity. It will not get rid of cellulite or stretch marks. CIGNA.com A Health Me.com

      Here’s clinical bulletins on when these Insurance Companies might consider liposuction, medically necessary:

      Oscar – Bariatric Surgery

      Aetna – Obesity Surgery

      Aetna Cosmetic Surgery

      Aetna Abdominoplasty, Suction Lipectomy

      More clinical bulletins from Aetna

    • Sorry, your question is beyond our pay grade. See the CMS link below for complete details only an experienced MD could decipher.

      Medicare Part B (Medical Insurance) covers medically necessary clinical diagnostic laboratory tests, when your doctor or practitioner orders them. These tests are done to help your doctor diagnose or rule out a suspected illness or condition. Medicare also covers some preventive services to help prevent, find, or manage a medical problem.

      Diagnostic non-laboratory tests
      Part B covers diagnostic non-laboratory tests when these apply:

      Your doctor or other health care provider orders them.
      They’re ordered as part of treating a medical problem.
      Examples of diagnostic non-laboratory tests include CT scans, MRIs, EKGs, X-rays, and PET scans. These tests are done to help your doctor diagnose or rule out a suspected illness or condition. Medicare also covers some preventive services to help prevent, find, or manage a medical problem.


      National Coverage Determination (NCD) for Magnetic Resonance Imaging

      A spinal MRI is used to find various spinal problems, including nerve damage or tumors. It typically costs $1,000-$5,000,

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