CurrentBaylor Scott & White Health PlanPolicy 213

Medical Necessity Determination

Defines how Baylor Scott & White Health Plan (and related entities) determine whether services are medically necessary and therefore eligible for benefit coverage; applies to providers, reviewers, and covered persons across plan types including Medicare, Medicaid, and other plans.

Policy Summary

PayerBaylor Scott & White Health Plan

PolicyMedical Necessity Determination

Policy CodePolicy 213

Change TypeNo material change

Effective DateFeb 1, 2026

Next Review DateJan 22, 2027

Key ActionProvide sufficient clinical information with requests to allow a determination of medical necessity; pursue peer-to-peer review or formal appeal if denied for lack of medical necessity.

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

3-plancoverage determination hierarchies

CMS/TMHPExternal authorities

since 2015Policy history

includedDefinitions appendix

Coverage & Determination Rules

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Coverage Determination Criteria by Plan Type

Coverage review determinations follow the listed hierarchies and definitions for 'reasonable and necessary' depending on plan type.

Medicare hierarchy: When evaluating Medicare lines of business, BSWHP uses: 1) National Coverage Determinations (NCDs) / Local Coverage Determinations (LCDs); 2) internally developed BSWHP Medical Policy (based on peer‑reviewed medical literature); 3) InterQual Medicare Products (Commercial sources may be used when appropriate); 4) generally accepted standards of medical practice.

Coverage criteria shall not be more restrictive than traditional Medicare laws unless superseded by MA‑specific laws (e.g., inpatient, SNF, home health, IRF payment criteria).

Medicaid hierarchy: For Medicaid lines of business, BSWHP uses: 1) Texas Medicaid Provider Procedures Manual (TMPPM); 2) internally developed BSWHP Medical Policy (based on peer‑reviewed medical literature); 3) InterQual Commercial Products (Medicare sources may be used when appropriate); 4) generally accepted standards of medical practice.

Coverage criteria shall not be more restrictive than the TMPPM; BSWHP may not require prior authorization in instances where TMPPM recommends no PA.

Other plans hierarchy: For all other plans, BSWHP uses: 1) applicable state and federal mandates; 2) internally developed BSWHP Medical Policy (based on peer‑reviewed medical literature); 3) InterQual Commercial Products (Medicare sources may be used when appropriate); 4) generally accepted standards of medical practice; and where none apply, follow CMS rules and regulations.

Reasonable and necessary criteria (Medicare): Under §1862(a)(1)(A), services are 'reasonable and necessary' when they are safe and effective, not experimental or investigational, appropriate in duration/frequency/setting/and personnel, furnished in accordance with accepted standards of medical practice, and meet but do not exceed the beneficiary's medical need.

Defined by the Medicare Administrative Contractor guidance.

Medicaid 'Medically Necessary' criteria (Texas): Per Texas Administrative Code §353.2, 'Medically necessary' includes: for ages 0–20, Texas Health Steps services and other services necessary to correct or ameliorate a defect or condition; for members over 20, non‑behavioral health services that prevent or treat conditions, are provided at appropriate facilities/levels of care, consistent with endorsed practice guidelines, consistent with the member's medical need, no more intrusive than necessary, not experimental, and not primarily for convenience; behavioral health services have analogous criteria tied to accepted behavioral health guidelines.

Include age‑specific distinctions and reference to TMPPM requirements.

Provider Responsibilities & Authorization

Prior Authorization

Prior Authorization Determined by Plan and State Guidance

Prior authorization (PA) requirements vary by line of business and are determined by the member's plan, applicable state and federal mandates, and the Texas Medicaid Provider Procedures Manual (TMPPM) where applicable. BSWHP may not require PA in certain instances where the TMPPM recommends PA. Providers should verify PA requirements for the specific member and service prior to rendering care to avoid claim denials or delays.

PA is determined by the member's plan and applicable state/federal mandates
TMPPM guidance may supersede internal PA requirements for Texas Medicaid; exceptions may apply
Verify PA requirements through the member's benefit plan or BSWHP provider resources before scheduling services

Denial Risk

Insufficient Information Triggers Denial

Requests that do not include sufficient clinical information to support medical necessity will be denied by the reviewing Medical Director as Not Medically Necessary. When a request is denied for insufficient information, the provider may pursue peer-to-peer review or submit a formal appeal within regulatory timeframes.

Insufficient documentation will result in denial as Not Medically Necessary
Providers may request a peer-to-peer discussion following a denial
Formal appeals are available and must follow regulatory deadlines

Documentation Required

Sufficient Clinical Documentation Required

Provide complete and legible clinical documentation with every request to support medical necessity determinations. Documentation should include relevant history, diagnostic findings, prior treatments and responses, physical exam findings, and any specialty consultations. When necessary, providers may request peer-to-peer review to clarify clinical information.

Include patient history, diagnostic test results, prior treatment and response, and relevant exam findings
Attach specialty consult notes and supporting imaging/lab reports when applicable
Peer-to-peer review is available to discuss clinical details with the reviewing Medical Director

Denial Risk

Denial Risk for Incomplete Requests

If a request is denied for lack of medical necessity due to insufficient or missing information, the denial is issued as Not Medically Necessary. Providers have the opportunity to obtain a peer-to-peer review or file an appeal per applicable regulatory processes and timeframes.

Denials for insufficient information are documented as Not Medically Necessary
Peer-to-peer and formal appeal rights apply after such denials
Follow regulatory timelines for appeal submission

Policy Purpose & Scope

This policy defines the purpose, scope, and authoritative hierarchy used to determine whether services are reasonable and necessary across Medicare, Texas Medicaid, and other plan types. It applies to providers, reviewers, and covered persons for all lines of business unless otherwise stated, and clarifies that medical necessity determinations are subject to applicable federal and state laws and the member's benefit terms.

For Medicare, the policy directs reviewers to follow a defined hierarchy that includes National Coverage Determinations (NCDs) and Local Coverage Determinations (LCDs), internal BSWHP medical policy, InterQual Medicare products (with limited use of commercial sources when appropriate), and generally accepted standards of medical practice. For Texas Medicaid, the policy requires use of the Texas Medicaid Provider Procedures Manual (TMPPM), internal BSWHP medical policy, InterQual commercial products (with permitted Medicare source use), and accepted standards of practice; it also notes BSWHP may not impose prior authorization where TMPPM indicates none is required. For other plans, reviewers follow applicable state and federal mandates, internal policy, InterQual commercial products, and generally accepted standards, and may refer to CMS rules when no other authority applies.

The policy emphasizes that coverage criteria shall not be more restrictive than controlling Medicare or TMPPM requirements and that, where state or federal mandates control, those mandates take precedence over internal policy. The appendix provides program-specific definitions of medical necessity for Medicare, Texas Medicaid, and other plans to support consistent determinations.

Term Definitions (Program-Specific)

Medical Necessity (Medicare/Medicaid/Other)

Medicare — statutory basis'Reasonable and Necessary' per Section 1862(a)(1)(A) of the Social Security Act: no payment under Part A or B may be made for items or services not reasonable and necessary for diagnosis or treatment or to improve functioning of a malformed body member.

Medicare — MAC guidanceNovitas‑Solutions (CMS MAC for Texas) 'Reasonable and Necessary Guidelines' apply when NCDs/LCDs or CMS manual instruction are absent; reasonable and necessary standards remain controlling.

Texas Medicaid — age‑specific definition (birth through age 20)Medicaid members birth through age 20: Texas Health Steps services (screening, vision, dental, hearing) and other services necessary to correct or ameliorate a defect or condition; determinations must comply with applicable final court orders and may consider additional listed factors.

Texas Medicaid — age 21 and older (non‑behavioral)For Medicaid members over age 20, non‑behavioral services are 'medically necessary' if reasonable and necessary to prevent or treat conditions, provided at appropriate facilities/levels of care, consistent with endorsed practice guidelines, consistent with the member's medical need, not more intrusive than necessary, not experimental, and not primarily for convenience.

Texas Medicaid — age 21 and older (behavioral health)Behavioral health services for members over age 20 must be reasonable and necessary for diagnosis/treatment or to improve/maintain functioning, follow professionally accepted behavioral health guidelines, not be experimental, and not primarily for convenience.

Other plans — general definition'Medically Necessary' means services a prudent provider would provide to evaluate, diagnose, or treat illness/injury—consistent with generally accepted standards of medical practice; clinically appropriate in type/frequency/extent/site/duration; and not primarily for convenience nor more costly than an equivalent alternative.