What is external review?
External independent review means someone outside the insurance company—a reviewer chosen through DIFI(Arizona Department of Insurance and Financial Institutions)—decides whether the plan's denial was correct.
For many fully insured Arizona plans, this decision is binding on the insurer for the issue being reviewed (the plan still cannot be forced to cover something your policy excludes).
External review is notthe first step. You usually must finish the plan's internal appeals first, unless the situation is urgent or the law allows you to skip ahead. Start with Arizona internal appeals & grievances.
General background: Appeals roadmap.
When you can use it
External review is for disputes like:
- Medical necessity
- Whether care was appropriate (setting, level of care)
- Experimental or investigational treatment
- Some coverage disputes after internal review
It is usually not the right tool for simple billing typos, wrong codes, or problems fixed by sending missing paperwork—see Denial decoder.
You can request external review when (A.R.S. § 20-2537):
- You finished all internal appeal levels and still got a final denial, or
- The plan only has one internal level and you completed it, or
- You qualify for an expedited external review in an urgent situation (see below)
How to request it (step by step)
- Read your final denial letter. It should mention external independent review and DIFI.
- Gather documents: denial letters, medical records, and a clinician letter explaining why the care is needed.
- Send a written request to your insurance company (not directly to DIFI first). Include why you disagree and any new support. You generally have four months from the final internal denial (A.R.S. § 20-2537(B)).
- The insurer forwards your file to DIFI within five business days. DIFI assigns an independent review organization (IRO).
- The IRO reviews the case and sends its decision to DIFI, which notifies you, your doctor, and the plan.
DIFI's consumer guide and appeals packet explain forms and examples (Consumer Guide (PDF); Appeals Packet (PDF)). There is no cost to the member.
After DIFI sends acknowledgment, you may have five business days to send extra written evidence for the IRO to consider (A.R.S. § 20-2537(C)(1)).
How long it takes
Timelines are in state law; the whole process can take several weeks start to finish.
- Standard medical necessity review: the IRO generally must decide within 21 days after DIFI sends the case to the IRO (A.R.S. § 20-2537(F)). DIFI then notifies everyone within five business days.
- Coverage-only issues: DIFI may decide within 15 business days (A.R.S. § 20-2537(I)).
Consumer summaries sometimes describe the full experience as up to about 45 days (coveragerights.org — Arizona) because of insurer and DIFI processing steps before the IRO clock starts.
If the IRO says the care is medically necessary and covered, the insurer must provide the service or pay the claim (A.R.S. § 20-2537(H)).
When it does not apply
- Self-funded employer plans (ERISA): DIFI external review usually does not apply. See Self-funded ERISA plans.
- Medicare and AHCCCS:use those programs' appeal systems.
- Excluded benefits: external review cannot force the plan to cover something the contract excludes (A.R.S. § 20-2537(P)).
If external review still denies coverage, you may file a complaint with DIFI — Regulator complaints and difi.az.gov — file a complaint.
Urgent cases
When waiting for a normal appeal would seriously harm the patient, Arizona has an expedited external independent review path (A.R.S. § 20-2537(N)):
- Often used after expedited internal steps fail, or when you are still in the hospital and coverage is being cut off
- Request in writing to the insurer (oral request may be allowed for some experimental/investigational cases with a doctor certification)
- The IRO generally must decide within 72 hours after DIFI receives the case
- DIFI must notify you within one business day after receiving the IRO decision
For expedited internal steps (72-hour medical review, 3-business-day expedited appeal), see Arizona internal appeals. Some members can start expedited external review while an initial appeal is still open—check the plan's DIFI appeals packet.
More on urgency across plan types: expedited appeals.