What Does “Medical Necessity” Really Mean?

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medical necessity

The purpose of health insurance is to reimburse doctors, hospitals, and caregivers for the services they provide.  The way that is accomplished logistically is based on a series of codes submitted from the providers’ offices.  After insurance pays their portion, you may still owe your providers money, based on the type of plan you have, and whether you paid co-pays upfront or you have a deductible. 

Sometimes, however, insurance will refuse to reimburse providers for services they consider elective, experimental, or not medically necessary. In this article, we are going to discuss what the term “medical necessity” really means for health insurance.  Specifically, we will cover whether items like cosmetic surgery are truly medically necessary.  

Cosmetic Surgery

Procedures that are undertaken for the express purpose of altering the patient’s body for aesthetic reasons are what we commonly think of when we hear the term “cosmetic surgery.” For example, cosmetic surgery could be breast implants, rhinoplasty (nose jobs), and botox injections.

Any time that a patient is under general anesthesia, there are risks of long-term impact on their health. Consequently, insurance does not pay for surgery that is not medically necessary. 

However, reconstructive procedures may be covered by insurance. Insurance may pay to restore a symmetrical appearance after a mastectomy to remove breast cancer, or surgery to reduce scarring after an injury accident.

Botox is widely known as a cosmetic treatment for the appearance of facial wrinkles. This is because botox blocks chemical signals from the nerves, typically the nerves that cause muscles to contract. As a cosmetic procedure, this helps relax the muscles that contract the forehead and eye areas.  

However, in recent years botox has been used to treat other conditions related to nerve signals, including lazy eye, chronic migraine, and bladder incontinence. Billing experts can help you determine how procedures were submitted to insurance, and the likelihood you can appeal a denial to your insurance company.

Because this use of Botox is a new treatment, some insurance will consider it “experimental” and will elect not to cover it. Read below for more about experimental treatments.


If you have a plan that requires you to get referrals for your treatment, determining if a procedure is medically necessary is particularly important if a provider out of your insurance network is involved in your care.

Even if your doctor determines that a procedure is medically necessary if it will be an expensive procedure it is worth reviewing your policy and calling your insurer to make sure of the rules. If a procedure that is not a result of emergency care is performed without prior authorization, insurance may deny the claim. You can appeal this to your insurance company, but you may have a difficult time if you have not followed the rules put in place by your insurance policy. 

A medical billing expert can help you sort through the often-confusing world of codes and procedures and determine if there were any errors on the provider’s side causing an insurance denial.

Experimental Treatment

Experimental treatments are most commonly drugs or vaccines that have not yet been approved by regulatory bodies for widespread use. Vaccines like the treatment for Covid-19 which are approved for emergency use by the FDA are considered experimental until they receive full approval, in which time side-effects may be discovered in the wider population.

The use of medical cannabis is another case in which the treatment is considered experimental. The FDA has not approved the use of marijuana for treating medical conditions. Despite more than 30 states legalizing the use of cannabis for medical conditions, it remains illegal at the federal level and classified as a schedule I drug. This is the most restrictive tier of classification and is characterized by being considered to have no medical use and a high potential for abuse.

It has been impossible for the FDA to approve the use of medical marijuana because the restrictive nature of the Drug Enforcement Administration’s classification prevents extensive trials for the purposes of determining the safety of use and the efficacy of use for marijuana. 

All of these factors: the restrictive DEA classification declaring “no accepted medical use,” the lack of FDA approval, and current federal illegality mean that health plans will not cover the use of medical marijuana, even if your doctor determines it is medically necessary and it is an effective treatment.

Determining Medical Necessity

Whether a procedure is considered medically necessary can change depending on whether or not you are insured by Medicare or private insurance, and the region in which you receive your treatment can influence the approval as well.

For example, there are National and Local Coverage determinations and private Medicare plans that do not always agree with each other. Furthermore, private insurance companies can set their own standards.

A medical billing expert in your area can help you determine what is considered medically necessary by these local coverages and the interpretation of your healthcare plan.

Why You Need Medical Billing Analysts

It is highly recommended to hire a medical billing and reimbursement expert to determine and testify to the reasonable value of medical service. The provider’s location can affect these costs and reimbursements.

Whether you are a plaintiff or a defendant in a case, one of the most important items in Automobile, Personal Injury, and Medical Malpractice cases is the cost of medical bills. Figuring out medical costs can be complicated, and expert guidance is critical to ensuring you have a clear understanding of what is “fair and reasonable” with regard to the finances involved in your medical care.

Medical Billing Analysts offers litigation support services nationwide, with offices in New York, New Jersey, Connecticut, Pennsylvania, Georgia, Florida, Texas, Nevada & California. Medical Billing Analysts represent both defendants and plaintiffs with regard to improper medical billing and coding.

The team of MBA professionals will review the hospital, medical and therapy bills to determine the value of past medical expenses, and based on local CPT codes they can also perform a Cost Projection Analysis of future costs.  Through meticulous analysis, we can justify the reasonable cost of services that assists in resolving the case.

Contact Medical Billing Analysts by phone or email at 800-292-1919 or intake@medicalbillinganalysts.com. We’re here for you, whether you need an evaluation of a single charge or a complex injury case.