Policy hierarchy and scope for medical necessity determinations
Customize your policy alerts
Sign up for chocchildrenshospitalorangecountyhealthalliance Policy CCP-105 alerts
Get alerted when Policy CCP-105 changes without checking for updates manually.
Monitor payer policy activity
Defines principles, hierarchy, and operational scope Alliance Health uses to determine medical necessity for coverage decisions affecting Alliance Health Tailored Plan beneficiaries, including EPSDT considerations for those under 21.
No material clinical or coverage changes in this revision.
Coverage and Medical Necessity Criteria
Medical Necessity and Eligibility Criteria
Covered when ALL of the following are met
based on chunk 5
based on chunk 6
based on chunk 6
Alliance Health does not cover services that could be safely provided in a less intensive or lower-cost setting, or any service that exceeds what is clinically appropriate in scope, duration, or frequency. These limitations are applied to ensure care is provided in the most appropriate setting and to avoid unnecessary use of higher-cost resources.
Services that are not medically necessary are excluded from coverage. This includes, but is not limited to, items listed under Limitations/Exclusions such as care that could be provided in a lower-cost setting, care that exceeds clinically appropriate scope/duration/frequency, and services that are experimental or investigational (see CCP-100), unless EPSDT requires otherwise.
Provider Requirements and Operational Notes
Obtain prior authorization when indicated by Alliance code lists
Prior authorization (PA) is required for services, products, or procedures when required based on applicable billing codes as identified in Alliance's Provider Lookup Tool or other Alliance-designated code-based PA resources.
Prefer less costly, equally effective alternatives
Alliance requires that a service be denied as not medically necessary when an equally effective, less costly alternative exists; the policy explicitly states no equally effective, less costly alternative may exist for a service to be medically necessary.
- Apply the hierarchy of sources when evaluating alternatives (NCDHHS Clinical Coverage Policies, Alliance Clinical Coverage Policies, MCG criteria).
- Prefer less costly, equally effective options before authorizing higher-cost services.
Use required documentation templates to justify medical necessity
Documentation must support the medical necessity of the requested service and must use the specific templates for CS and MDs in Alliance's healthcare management platform to demonstrate compliance and support utilization management and Medical Director review.
- Include clinical information showing the service is individualized, appropriate to diagnosis and severity, and that no equally effective, less costly alternative exists.
Denial risk if service is not medically necessary or is higher-intensity than needed
Services that are not medically necessary may be denied; examples include services that could be provided in a less intensive or lower-cost setting, services exceeding clinically appropriate scope/duration/frequency, or services that are experimental/investigational (see CCP-100).
- Requests exceeding clinically appropriate scope, duration, or frequency risk denial.
- Services that can safely be provided in a less intensive or lower-cost setting may be denied as not medically necessary.
Key Definitions
Background and Policy Scope
This policy establishes the principles and hierarchy Alliance uses to determine medical necessity. Decisions prioritize individualized assessment consistent with the beneficiary’s diagnosis and severity, reference NCDHHS Clinical Coverage Policies first, then Alliance Clinical Coverage Policies, and use MCG criteria when available. EPSDT provisions apply for beneficiaries under age 21, and prior authorization is required when indicated by Alliance’s code-based PA resources.
OpenPayer is powered by Trek Health's payer performance platform. Trek continuously ingests, validates, and normalizes Transparency in Coverage data alongside payer policies and other commercial payer data to create a structured payer intelligence foundation. OpenPayer uses this foundation to deliver personalized search results, dynamically generated policy pages, and tailored policy monitoring based on each user's payers, specialties, billing codes, and areas of interest. The same intelligence powers broader payer performance workflows, including reimbursement benchmarking, contract evaluation, payer negotiations, and financial decision-making.