CurrentCareSourcePolicy N/A

Medical Necessity Determinations — Arkansas PASSE

Administrative policy governing how CareSource determines medical necessity for services under the Arkansas PASSE program, including behavioral health parity considerations and which sources guide determinations; applies to CareSource reviewers and providers serving Arkansas PASSE members.

Policy Summary

PayerCareSource

PolicyMedical Necessity Determinations — Arkansas PASSE

Policy CodePolicy N/A

Change TypeNo material changes

Effective DateJan 1, 2026

Next Review DateN/A

Key ActionDetermine medical necessity using the specified hierarchy (benefit contract, regulations, provider manuals, internal policies, evidence-based guidelines, then reviewer judgment).

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

6sources used to determine medical necessity

case-by-caseNCSS handling

MHPAEAbehavioral health parity

presentmedical necessity definition

Coverage & Medical Necessity Criteria

Policy Summary

PayerCareSource

PolicyMedical Necessity Determinations — Arkansas PASSE

Policy CodePolicy N/A

Change TypeNo material changes

Effective DateJan 1, 2026

Next Review DateN/A

Key ActionDetermine medical necessity using the specified hierarchy (benefit contract, regulations, provider manuals, internal policies, evidence-based guidelines, then reviewer judgment).

SourceLink

On This Page

Trek Health ingests and normalizes Transparency in Coverage data and payer policy updates to give provider organizations a clear view of how commercial reimbursement behaves across markets, payers, and services. Our platform transforms raw payer disclosures into structured intelligence that supports contract evaluation, payer negotiations, and service line strategy. By combining market benchmarks with ongoing policy visibility, Trek helps teams identify variability, risk, and opportunity in commercial reimbursement. The result is faster insight, stronger negotiating positions, and more informed financial decisions.

Evidence Standards

When using published evidence the reviewer prefers and requires specific study standards:

Evidence standards: Preferred: evidence from 2 published studies from major peer-reviewed journals <5 years old; Required: <10 years old to support proposed use as safe and effective. Additional acceptable resources include national panels, commercial review organizations, peer consultation, and specialty societies. Studies involving vulnerable minors must be IRB-approved by a U.S. accredited board.2 studies preferred (<5y); <10y required

Sources listed may include NIH, CDC, AHRQ, NCCN, SAMHSA, UpToDate, Hayes, specialty societies, and peer consultation.

Provider Responsibilities and Authorization Notes

Note

Authorization vs. policy guidance — administrative policy does not guarantee authorization/payment

Administrative policy statements do not guarantee that a requested service will be authorized or paid. Refer to the member’s plan contract / Evidence of Coverage for final coverage determinations. If the Administrative Policy Statement conflicts with the plan contract (Evidence of Coverage), the plan contract controls.

Plan contract (Evidence of Coverage) governs final determinations
Administrative policy ≠ authorization or payment guarantee

Prior Authorization

Conservative-treatment expectation — require no equally effective, more conservative or less costly treatment available

CareSource expects that less invasive, conservative, or lower-cost alternatives have been considered and documented before approval of a more intensive service. A requested service is not medically necessary if there is an equally effective, more conservative, or less costly treatment available and suitable for the member.

Document prior conservative treatments tried and their outcomes (e.g., observation, medications, therapy)
If 'no treatment' or observation is an appropriate course, document rationale

Documentation Required

Documentation to support medical necessity — specificity of diagnosis, condition description, emergent/acute identification and other documentation expectations

Provide clear, specific documentation to support medical necessity: include precise diagnosis coding (highest level of specificity), detailed description of the member’s condition, onset and acuity (emergent, acute, chronic), objective findings, prior treatments and responses, and any functional impact. Use accepted clinical standards and cite relevant guidelines or objective data when applicable.

ICD coding with highest specificity to reflect the clinical condition
Description of symptoms, exam findings, imaging/lab results, and functional limitations
Dates and outcomes of prior treatments and rationale for escalation
Identify emergent or acute presentation when applicable

Denial Risk

Denial risk for services not meeting medical necessity — coverage may be denied if not medically necessary or considered experimental unless objective justification provided

Coverage may be denied when services do not meet the medical necessity criteria or are considered experimental, inappropriate, or ineffective. Denials may be issued if documentation is insufficient to demonstrate that the requested service meets the policy's medical necessity hierarchy or if a less intensive alternative would be appropriate.

Services generally regarded as experimental or lacking objective clinical justification risk denial
Insufficient documentation of diagnosis, prior conservative care, or objective findings increases denial risk

Background and Rationale

Definitions of medical necessity vary among payers and regulators, but commonly require that a service be reasonable and necessary for the member’s condition and consistent with current standards of practice. CareSource applies a hierarchical approach when determining medical necessity, using sources in the following order: A. Benefit contract language; B. Federal and state regulations (including state waiver rules); C. Arkansas Medicaid Provider Manuals; D. CareSource medical policy statements; E. Nationally accepted evidence-based clinical guidelines (e.g., MCG Health, Interqual, ASAM); F. Professional judgment of the medical or behavioral health reviewer. Certain supports classified as Nonmedical Community Supports and Services (NCSS) are nonmedical in nature and are reviewed case-by-case; if an HCBS service includes a clinical component, the medical necessity standard applies.

Key Definitions

Medically Necessary / Medical Necessity — definition describing services reasonably calculated to prevent, diagnose, correct, cure, alleviate, or prevent worsening

DefinitionA service reasonably calculated to prevent, diagnose, correct, cure, alleviate, or prevent the worsening of conditions that endanger life, cause suffering or pain, result in illness or injury, threaten to cause or aggravate a handicap, or cause physical deformity or malfunction.

Conservative/alternative treatmentsService is medically necessary only if there is no other equally effective, more conservative, or less costly course of treatment available or suitable; a course of treatment may include observation or no treatment when appropriate.

Denial riskCoverage may be denied if a service is not medically necessary or is generally regarded by the medical profession as experimental, inappropriate, or ineffective unless objective clinical evidence demonstrates the service is necessary.

ScopeApplies to services evaluated for Arkansas PASSE members under this administrative policy statement.

Nonmedical Community Supports and Services (NCSS) — definition and handling of nonmedical supports necessary for health/safety and community living

DefinitionSupports and services nonmedical in nature but necessary to protect the health and safety of members and enable safe living in the community.

Authority and availabilityNCSS are available under federal authority (sections 1905, 1915(c), or 1915(i)) or state authority under Act 775, provided by an AR Medicaid enrolled provider as approved by a PASSE for a member.

Purpose and useProvided to prevent or delay entry into an institutional setting or to assist or prepare a member to leave an institutional setting; services should assist safe living in a member's home or community.

Need determinationNeed is established by functional deficits identified on the Independent Assessment (ARIA) and actual services/supports are described in the PCSP.

Clinical componentHCBS services with a clinical component must be evaluated using the medical necessity standard.

Mental Health Parity and Addiction Equity Act (MHPAEA) — summary of federal parity requirements referenced

Statutory purposeMHPAEA is a federal law that prevents group health plans and issuers from imposing less favorable benefit limitations on mental health and substance use disorder (MH/SUD) benefits than on medical/surgical benefits.

Policy applicationUnder MHPAEA, coverage for diagnosis and treatment of behavioral health/substance use disorder will not be subject to limitations less favorable than those that apply to medical conditions under this policy.

Reviewer obligationReviewers must determine medical necessity using the established hierarchy of sources (benefit contract, regulations, provider manuals, CareSource policy, nationally accepted guidelines, and professional judgment) when applying parity requirements.