What Is An IRO?

Friday, May 12th, 2017

IRO stands for independent review organization. This type of organization is present in many industries, providing peer review and judgement of a person’s work, production, performance, or related behavior. The use of IROs has become a leading practice in the healthcare industry in the past few years. Using an IRO is a great way to get an objective third party decision on medical cases. It is important to understand how an IRO can be beneficial to your healthcare facility and to understand IRO regulations in Texas.

Why are IROs important in today’s healthcare world?

Healthcare IROs have the responsibility of determining whether a healthcare service is appropriate and medically necessary, or if it is experimental or investigational. In terms of healthcare, an IRO is an option for a patient who has gone through all appeal options available in their health benefit plan. An IRO can offer an independent opinion that can sway the insurance company to pay for a treatment that the patient needs.

By federal law, all insurance providers must participate in an external review process. This regulation is part of the consumer protection standards that are part of healthcare law. Other parts of this law include the right for patients to know why the insurance company is denying coverage and the right for patients to appeal that decision. If appeals do not work, then the right to the independent appeal can be used.

Some states have guidelines that meet or exceed the federal laws. In those states, the insurance companies follow state law. In the states that don’t have guidelines which meet the federal standards, the U.S. Department of Health and Human Services oversees the external review process.

What about IROs in the state of Texas?

The state of Texas has an external review process that meets federal guidelines. In fact, Texas mandated that all health plans accepting patients in the state must agree to let those people appeal to a certified IRO. Insurance plans must allow patients to seek appeals when they are refusing to pay for a healthcare service.

The results of this regulation have been startling. One study found that 55 percent of Texas patients who filed an IRO appeal received additional treatment. That number means the insurance company’s denials were either partially or completely overturned. In the case of mental health treatment, the percentage went up to 70 percent.

The IRO reviews found that healthcare insurers had large gaps in their coverage and their guidelines for determining which treatments were acceptable or not. This information helped the state enhance its requirements for basic healthcare coverage for residents.

Healthcare providers must understand the IRO process, as it can affect their relationships with providers and with patients. If you are in need of legal assistance regarding IROs and the healthcare industry, call the attorneys at Brown & Fortunato in Amarillo, Texas. You can reach us at (806) 345-6300 or Contact Us by email for more information about our practice areas. You can also visit our offices at 905 S. Fillmore, Suite 400, in Amarillo.

This information is subject to change. Please check for updates that are more recent than the published date of this article.