Recent amendments apply standards of external review
Regulations were designed to provide uniform federal standards to govern consumers' right to appeal denials of claims or coverage by health plans.
Generally, courts require litigants to exhaust all administrative remedies before seeking judicial intervention. Thus, a claimant would be required to exhaust a plan's internal review processes before resorting to external review. Under the 2010 regulations, however, this administrative exhaustion requirement was relaxed such that a claimant could immediately seek external review of benefit denials if the plan failed to "strictly adhere" to all of the regulations' requirements for internal claims and appeals processes.
This amendment effectively removes the "strict" from "strict adherence" and perhaps is more indicative of a "substantial adherence" standard.
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