C.F.R. » Title 42 » CHAPTER IV—CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES › SUBCHAPTER C—MEDICAL ASSISTANCE PROGRAMS › PART 438—MANAGED CARE › Subpart F—Grievance and Appeal System

42 C.F.R. § 438.400

Statutory basis, definitions, and applicability

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(a) Statutory basis. This subpart is based on the following statutory sections:

(1) Section 1902(a)(3) of the Act requires that a State plan provide an opportunity for a fair hearing to any person whose claim for assistance is denied or not acted upon promptly.

(2) Section 1902(a)(4) of the Act requires that the State plan provide for methods of administration that the Secretary finds necessary for the proper and efficient operation of the plan.

(3) Section 1932(b)(4) of the Act requires Medicaid managed care organizations to establish internal grievance procedures under which Medicaid enrollees, or providers acting on their behalf, may challenge the denial of coverage of, or payment for, medical assistance.

(4) Section 1859(f)(8)(B) of the Act requires that the Secretary, to the extent feasible, establish procedures unifying grievances and appeals procedures under sections 1852(f), 1852(g), 1902(a)(3), 1902(a)(5), and 1932(b)(4) of the Act for items and services provided, by specialized Medicare Advantage plans for special needs individuals described in section 1859(b)(6)(B)(ii), under Titles XVIII and XIX of the Act.

(b) Definitions. As used in this subpart, the following terms have the indicated meanings:

Adverse benefit determination means, in the case of an MCO, PIHP, or PAHP, any of the following:

(1) The denial or limited authorization of a requested service, including determinations based on the type or level of service, requirements for medical necessity, appropriateness, setting, or effectiveness of a covered benefit.

(2) The reduction, suspension, or termination of a previously authorized service.

(3) The denial, in whole or in part, of payment for a service. A denial, in whole or in part, of a payment for a service solely because the claim does not meet the definition of a “clean claim” at § 447.45(b) of this chapter is not an adverse benefit determination.

(4) The failure to provide services in a timely manner, as defined by the State.

(5) The failure of an MCO, PIHP, or PAHP to act within the timeframes provided in § 438.408(b)(1) and (2) regarding the standard resolution of grievances and appeals.

(6) For a resident of a rural area with only one MCO, the denial of an enrollee's request to exercise his or her right, under § 438.52(b)(2)(ii), to obtain services outside the network.

(7) The denial of an enrollee's request to dispute a financial liability, including cost sharing, copayments, premiums, deductibles, coinsurance, and other enrollee financial liabilities.

Appeal means a review by an MCO, PIHP, or PAHP of an adverse benefit determination.

Grievance means an expression of dissatisfaction about any matter other than an adverse benefit determination. Grievances may include, but are not limited to, the quality of care or services provided, and aspects of interpersonal relationships such as rudeness of a provider or employee, or failure to respect the enrollee's rights regardless of whether remedial action is requested. Grievance includes an enrollee's right to dispute an extension of time proposed by the MCO, PIHP or PAHP to make an authorization decision.

Grievance and appeal system means the processes the MCO, PIHP, or PAHP implements to handle appeals of an adverse benefit determination and grievances, as well as the processes to collect and track information about them.

State fair hearing means the process set forth in subpart E of part 431 of this chapter.

(c) Applicability. (1) Subject to paragraph (c)(2) of this section, this subpart applies to the rating period for contracts with MCOs, PIHPs, and PAHPs beginning on or after July 1, 2017. Until that applicability date, States, MCOs, PIHPs, and PAHPs are required to continue to comply with subpart F contained in the 42 CFR parts 430 to 481, edition revised as of October 1, 2015.

(2) Provisions in this part affecting applicable integrated plans, as defined in § 422.561 of this chapter, are applicable no later than January 1, 2021.

[81 FR 27853, May 6, 2016, as amended at 84 FR 15844, Apr. 16, 2019; 85 FR 72842, Nov. 13, 2020]
Notes of Decisions
Cited in 9 cases (5 in the last 5 years), 2012–2023 · leading case: Bellin v. Zucker, 6 F.4th 463 (2d Cir. 2021).
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Bellin v. Zucker, 6 F.4th 463 (2d Cir. 2021). · cites it 2× “” 42 C.F.R. § 438.400 (b)(1). Bellin argues that RiverSpring’s initial determination that Bellin was eligible for only eight hours of personal care services per day constituted an “adverse benefit determination” within this statutory scheme.”
K.C. Ex Rel. Africa H. v. Shipman, 716 F.3d 107 (4th Cir. 2013). · cites it 2× “Once an enrollee’s services are authorized, the contract provides that if PBH reduces or terminates those services, PBH must provide the enrollee with certain notice and appeal rights described in 42 C.F.R. §§ 438.400 -.424. As part of its pre-authorization process, PBH sets…”
Shakhnes Ex Rel. Shakhnes v. Berlin, 689 F.3d 244 (2d Cir. 2012). “” See 42 C.F.R. § 438.400 (a)(3) (emphasis added); see also 67 Fed.”
N.P. Vs. Div. of Med. Assistance & Health Servs. (new Jersey Dep't of Human Servs.) (N.J. Super. Ct. App. Div. 2019). · cites it 4× “The ALJ observed the notice a MCO is to provide an enrollee must include certain information, which United did not provide to 2 We are aware 42 C.F.R. 438.400 and 42 C.F.R. 438.404 were amended effective July 5, 2016.”
Turano v. Zucker (E.D.N.Y 2021). · cites it 3× “The Second Circuit affirmed the district court’s conclusion that the plaintiff did not have a statutory right to appeal an MLTCP’s initial determination of her PCS needs, holding that an MLTCP’s initial determination of a particular number of PCS hours does not constitute an…”
Kevin Wiesner v. Washtenaw Cnty. Cmty. Mental Health (Mich. Ct. App. 2022). “Statutes, regulations, and rules relevant to the Medicaid fair hearing in the present case are found in 42 CFR 438.400 through § 438.424 (rules governing appeals from adverse benefit determinations of, among others, managed care organizations and PIHPs), §§ 271 through 288, and…”
Kevin Wiesner v. Washtenaw Cnty. Cmty. Mental Health (Mich. Ct. App. 2022). “Statutes, regulations, and rules relevant to the Medicaid fair hearing in the present case are found in 42 CFR 438.400 through § 438.424 (rules governing appeals from adverse benefit determinations of, among others, managed care organizations and PIHPs), §§ 271 through 288, and…”
Fitzmorris v. NH Dep't of Health & Human Servs., Comm'r (D.N.H. 2023). “§ 1396a(a)(3)); Cassidy, 2021 WL 4472592 , at *6 (interpreting the term “adverse benefit determination” as defined in 42 C.F.R. § 438.400 ). In any event, those cases required notice only in response to an affirmative act by the state, rather than a mere failure to act.”
Bellin v. Zucker (S.D.N.Y. 2020). “” 42 C.F.R. § 438.400 (b)(1). The definition of “adverse benefit determination” does not contain any language limiting its application to enrollees.”
— 42 C.F.R. § 438.400(b) — 1 case
N.P. Vs. Div. of Med. Assistance & Health Servs. (new Jersey Dep't of Human Servs.) (N.J. Super. Ct. App. Div. 2019). “The ALJ observed the notice a MCO is to provide an enrollee must include certain information, which United did not provide to 2 We are aware 42 C.F.R. 438.400 and 42 C.F.R. 438.404 were amended effective July 5, 2016.”
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