Medical necessity often refers to a determination made for insurance purposes 1. For example, if a condition is chronic or terminal, treatment could be considered medically necessary whether the patient could afford the treatment or not. Some medical necessities are controversial, such as the use of medical marijuana, while others are more a moral-ethical issue, such as managed care and networked providers. Although medical necessity may become a factor for other insurance plans, Medicare and Medicaid are the most common, and their definition of medical necessity refers to services needed for diagnosing and treating an illness or injury or improving the functioning of the patient.
Physicians and other healthcare providers essentially enter a contract with their patients where patients understand that the provider’s top priority is, first and foremost, the patient’s well-being and improving the health condition through appropriate treatment. A physician who is under contract with a healthcare organization, however, may have to put the organization’s priorities above those of the patient, opting for cheaper treatment options, fewer follow-up visits, shorter appointment sessions and ultimately inefficient care.
Healthcare coverage for a patient may place limitations on the types of services the patient may receive as well as which providers the patient may see. For example, a patient with XYZ coverage may only be able to see providers from a list of contracted physicians, provided by the XYZ insurance company. If the patient requires a specialist, the coverage may not be available for non-network providers and specialists, which places an ethical burden on the contracted physicians who may be underqualified to meet the patient’s needs.
Experimental treatments can sometimes be quite expensive and not often covered for the patient under his current plan. Because of the label “experimental treatment,” the ability to claim the treatment as medically necessary may also be limited for both the patient and provider. Even if the physician feels the treatment is the patient’s best option, the insurance provider is not necessarily obligated to concur and provide coverage, which can leave the patient, provider and insurance company in disagreement and escalate to a legal battle or result in long delays, possibly increasing the patient’s suffering.
Too Many Cooks
Too many cooks spoil the soup! In other words, if many people are making decisions, the decision-making process can be less effective. Nonprofit organizations have little interest above and beyond the patients and providers, but not every insurance or healthcare organization is nonprofit. When investors have a stake in the healthcare system, the patient is often removed from the number one priority list and replaced with priorities involving increasing profits and reducing expenses. Additionally, many insurance companies retain the right to deny services, treatment and access to non-network providers, which means even if the provider says the treatment is necessary, the insurance company may deny the coverage for its own reasons.
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