Managed Care Organizations, also known as MCOs, are required to look at three factors when determining whether or not medical suppliers and services should be covered. Payment of medical supplies and services are made only when those supplies and services are medically necessary in the diagnosis and treatment of any allowed conditions. MCOs must evaluate medical treatment and reimbursement requests by applying a three-part test, which requires that:
(1) the requested services are reasonably related to the allowed conditions in the claim,
(2) the requested services are reasonably necessary for treatment of the allowed conditions, and
(3) the cost of the services are medically reasonable.