The Midwest Health Plan delegated utilization review (UR) activities to the Tri-City Utilization Review Organization.

The Midwest Health Plan delegated utilization review (UR) activities to the Tri-City Utilization Review Organization. After Tri-City improperly recommended denial of payment for services to a Midwest plan member, the plan member filed suit. The court ruled that Midwest was responsible for Tri-City’s actions because of the relationship between Midwest and Tri-City. This situation is an illustration of a legal concept known as