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Medical Necessity


The Company provides coverage for those covered services that are determined to be medically necessary consistent with benefit contracts and medical policy.

The definition of medically necessary can be found in the member's plan design. Please refer to the member's specific plan design for the definition of medically necessary.

Coverage is not available for services that do not meet the definition of medical necessary, including, but not limited to, experimental/investigational, cosmetic, and/or not medically necessary services.


HMO and HMO Point-of-Service (HMO-POS) products may require that the member obtain medically necessary services (e.g., Laboratory, Radiology) at the primary care provider’s (PCP’s) designated provider. In most cases, services that are rendered at a non-designated provider for members enrolled in HMO or HMO-POS products are not eligible for reimbursement consideration by the Company, with certain exceptions (e.g., medically necessary service cannot be provided at the designated provider).


In most cases, services received from an out-of-network provider (a provider who is not part of the Plan's network) will not be covered. However, services received from an out-of-network provider will be eligible for reimbursement consideration when the services are determined to be covered by the Plan and medically necessary and the Plan's in-network providers are unable to provide these services, or there are no providers within statutorily required distance requirements who can provide the service.

Services that are considered not covered by the Plan will not be eligible for reimbursement consideration. The following are some examples of services that are not eligible for reimbursement consideration: experimental/investigational services, cosmetic services, and durable medical equipment for comfort and convenience.

Once the service has been determined to be a covered service by the Plan and medically necessary, the Plan will determine if there is a provider or choice of providers within the plan’s network with the capacity to perform the requested service. This review will consider applicable state distance regulations. In the event that there is more than one network provider with capacity to perform the service, the plan will provide a choice of network providers to the requestor.

Services may be received from an out-of-network provider and will be eligible for reimbursement consideration when determined to be covered by the Plan and medically necessary. However, if an out-of-network provider is used, the member's out-of-pocket costs for covered services may be higher.

When services can be administered in various settings, the Company reserves the right to reimburse only those services that are furnished in the most appropriate and cost-effective setting that is appropriate to the member’s medical needs and condition. This decision is based on the member’s current medical condition and any required monitoring or additional services that may coincide with the delivery of this service.


The following general principles are the basis for the Company's determination that a service is medically necessary:
  • The service that an appropriate provider, exercising prudent clinical judgement, provides a member is appropriate and effective for preventing, evaluating, diagnosing, or treating an illness, injury, disease or its symptoms for which it is prescribed or performed, and not for experimental/investigational or cosmetic purposes; AND
  • The service is clinically appropriate, in terms of type, frequency, extent, and site and duration, and is considered effective for the member's illness, injury, or disease; AND
  • The service is appropriate with regard to generally accepted standards of medical practice within the medical community; AND
  • The service is not primarily for the convenience of the member, the member’s family, the professional provider, or other health care provider; AND
  • The service is 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 the member's illness, injury, or disease.
For these purposes, "generally accepted standards of medical practice" takes into consideration:
  • 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;
  • The views of professional providers practicing in the relevant clinical area; and
  • Any other relevant factors.
Designation of a code and/or fee does not imply reimbursement.


Subject to the terms and conditions of the applicable benefit contract, medically necessary services are covered by the Company when the applicable medical necessity criteria are met.


Covered services include all the medical care, health care services, supplies, and equipment that are covered by the Company's plan.

Medical Necessity is the term used in benefit plan designs to evaluate coverage for health care services, procedures, devices, and pharmaceuticals.


28 Pa. Code §9.679. Access requirements in service areas. [Pennsylvania Code]. Accessed May 28, 2020.

Company Benefit Contracts.

State of New Jersey. Subchapter 6. Provider Network. [New Jersey State Administrative Code]. Accessed May 28, 2020.


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