Independent Review Organization (IRO)

An Independent Review Organization (IRO) is an accredited third-party entity that conducts external appeal reviews of health plan denials. IROs employ or contract with physician reviewers in relevant specialties who examine the clinical documentation of a denied case and issue a binding determination — the plan must follow the IRO's decision, even if the plan disagrees.

IRO accreditation is handled at the state level for state-regulated plans and by the federal Department of Labor for self-funded ERISA plans. Accreditation standards address reviewer credentials (typically board-certified physicians in the relevant specialty), conflict-of-interest safeguards (the IRO can't be owned by or economically dependent on any health plan), turnaround-time requirements (45 days for standard review, 72 hours for expedited), and appeal-recordkeeping obligations. The IRO is assigned to a case at random from the approved list — plans and members can't select their preferred IRO. The reviewer receives the plan's denial rationale, the treating provider's records, and any additional documentation the member or provider chooses to submit. The reviewer then applies the standard of care (peer-reviewed medical literature, clinical guidelines, and the plan's own coverage policies) to determine whether the denial was appropriate. The IRO's determination is final for that specific claim — the plan cannot appeal an IRO overturn, and the plan must pay for the service or drug at issue if the IRO overturns the denial.

The takeaway: if you file for external review, know that the reviewer is a licensed specialist independent of the plan and that their decision is legally binding. Provide thorough clinical documentation — the more complete the record, the better the odds of an overturn.