Georgia doesn’t meet requirements on consumers’ ability to get a third-party review of their appeals against an insurer’s coverage decisions, a federal agency has ruled. Sixteen other states also failed to meet the federal criteria.

The 2010 health reform law gives people in group and individual health plans the right to appeal a denial of coverage to an independent review panel. Many consumers would be getting this right for the first time under the reform law.

The decision by the Centers for Medicare and Medicaid Services means that by 2012, Georgia and the other states will have to contract with three independent review organizations to handle consumer complaints, or contract with the Department of Health and Human Services to oversee the process, Kaiser Health News reported.

Currently, consumers generally have the right to appeal a coverage decision to the health plan itself.

But the reform law, if fully implemented, will allow third-party reviews of consumer appeals by millions of people in employer health plans that self-insure – and are exempted currently from regulation by states.

Bill Custer, a health insurance expert at Georgia State University, pointed out that employees in self-insured companies currently can also appeal coverage decisions to their employers, after a health plan’s denial.

The reform law’s change on independent reviews thus may not generate a large number of appeals, Custer said.

Georgia already has an external review process for appeals, but it only applies to health plans that are not run by self-insured employers.

A Kaiser Family Foundation study in 2002 found that among external reviews conducted by states, consumers won their cases 45 percent of the time.

The reform law’s external review provisions were scaled back by the Obama administration earlier this year, disappointing consumer advocates but drawing praise from insurance industry officials.

The other states judged as having inadequate reviews are Alabama, Alaska, Florida, Louisiana, Massachusetts, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Pennsylvania, Texas, West Virginia and Wisconsin.

An independent review would look at decisions “from an outside point of view, a medical point of view,’’ said Cindy Zeldin of the consumer advocacy group Georgians for a Healthy Future. Such a review, she said, “can take it one step further than an insurance company reviewing its own decision.’’

Officials with Georgia’s state insurance department could not be reached for comment Tuesday on the federal decision.

The reform law was written to take effect in stages, so some provisions are already in force while others are still pending. The Affordable Care Act is being challenged in the courts by 26 states, including Georgia, and the U.S. Supreme Court is expected to decide on the law’s ultimate fate.

The Georgia Association of Health Plans said its members oppose the federal decision on independent reviews and would prefer to keep the process within the state’s control.

Graham Thompson, executive director of the Georgia health plan group, said none of the third-party review companies are based in Georgia. The decision to contract with these firms or HHS, he said, would be the equivalent of ‘’outsourcing customer complaints out of state.’’

“We want to retain local control here,’’ Thompson said. “It’s a little frustrating,’’

The state insurance marketplace is already dealing with changes from other health reform provisions, such as a new review of health premium increases and the building a possible insurance exchange, he noted.

Meanwhile, Georgia also is waiting for federal officials to approve or reject its request to ease new federal restrictions on health insurer spending, also required under the health care reform law. Consumer groups in the state are opposing the waiver request.

The 2010 law requires companies to spend at least 80 percent of the premium dollars on medical care costs under policies bought by individuals. Georgia is seeking permission to allow the spending requirement to be phased in over three years, a request that is supported by the Georgia Association of Health Plans.

Here’s a recent GHN article on the state’s request for a waiver.

The reform law overall has the potential to revamp the traditional regulatory structure over health insurance, said Georgia State’s Custer.

“It’s really changing the locus of health insurance regulation,’’ he said.