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Insurer Playbook

Medicaid (State Medicaid Program — Generic Template)Denial patterns and how to appeal

Also known as: Medicaid, State Medicaid, Medical Assistance, Medi-Cal, MassHealth, BadgerCare, Peach Care, CHIP

Medicaid Fee-for-ServiceMedicaid Managed CareCHIP

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Known denial patterns

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Appeal best practices

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Points to check

Common Denial Patterns

  • Prior authorization denials for specialty care and imaging
  • Medical necessity denials, especially for behavioral health and home health services
  • Pharmacy denials based on state Preferred Drug Lists
  • DME and home health service limits
  • Managed care narrow network denials

Appeal Best Practices

  1. 1ALWAYS request a state fair hearing — the due process protections are stronger than any commercial appeal
  2. 2If services you already receive are being cut or stopped, request Aid Continuing when you file — before the date of the action for fee-for-service (42 CFR 431.230), or for managed care by the later of 10 days after the plan sent the notice or the effective date (42 CFR 438.420(a)); it does not apply to a first-time denial, and the cost may be recovered if the denial is upheld
  3. 3For children under 21, cite EPSDT — Medicaid must cover any medically necessary service for children even if not in the state plan
  4. 4For Medicaid managed care, exhaust the MCO internal appeal first, then file for state fair hearing
  5. 5Cite 42 CFR Part 431 Subpart E for fair hearing rights

Points to Check

  • Fair hearings are independent proceedings — not controlled by the Medicaid MCO
  • EPSDT for children is one of the broadest coverage mandates in US law
  • Aid Continuing can keep previously authorized services going during the appeal when every condition is met (42 CFR 431.230; 438.420(b)) — but if the denial is upheld, the state or plan may recover the cost (42 CFR 431.230(b); 438.420(d))
  • Legal aid organizations provide free representation for Medicaid fair hearings in most states
  • CMS federal oversight provides additional accountability for state Medicaid programs

Contact & Response

Best Contact Method

MCO member services > MCO written appeal > State fair hearing request

Typical Response Time

30-45 days (MCO internal), 90 days (state fair hearing)

Internal Criteria Used

  • State Medicaid Plan
  • MCG
  • InterQual
  • State Preferred Drug List

State-Specific Notes

CA

Medi-Cal — DHCS fair hearing process. SB 855 mental health parity.

NY

NY Medicaid — OTDA fair hearing. Broader coverage than many states.

TX

TX STAR/STAR+PLUS — HHS fair hearing process.

FL

FL Medicaid — AHCA fair hearing. Managed care through Staywell, Molina, etc.

IL

IL Medicaid — HFS fair hearing. Managed care through Meridian, Molina, etc.

PA

PA Medical Assistance — DHS fair hearing. Managed care through UPMC, Highmark, etc.

OH

OH Medicaid — ODJFS fair hearing. Managed care through CareSource, Molina, etc.

General Tips

  • Medicaid is a federal-state program — rules vary significantly by state
  • Medicaid recipients have a constitutional right to a fair hearing (Goldberg v. Kelly)
  • Fair hearings are administrative hearings independent of the Medicaid plan — use them
  • Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) for children under 21 provides extremely broad coverage
  • Medicaid managed care denials can be appealed both to the MCO and through state fair hearing
  • Aid Continuing (continuation of benefits during appeal) applies only when the action cuts, suspends or stops services you already receive — not to a first-time denial. Fee-for-service: request the hearing before the date of the action (42 CFR 431.230). Managed care: the appeal must be timely, the services ordered by an authorized provider, the original authorization unexpired, and continuation requested by the later of 10 days after the plan sent the notice or the effective date (42 CFR 438.420). If the denial is upheld, the state or plan may recover the cost

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This is general guidance compiled by Lysco. Check it against your plan documents and the notice you received, which set the rules for your appeal. It does not constitute legal, medical, or financial advice. Individual results vary. Verify all information independently and consult qualified professionals before acting.