You might run up against a health insurance claim denial when you use a medical service. Fortunately, routes are available for disputing claim denials, including getting help from the government in many states.
It's usually worth fighting your denial. Sometimes your insurer will surrender and pay your claim to avoid the expense of handling an appeal. Sometimes your protests will uncover and reverse a mistake the insurer has made. And often a combination of the two will result in at least a partial payment.
The best way to avert a claim problem is to avoid a dispute in the first place.
This will take a little work on your part: You must read your policy and understand what it covers -- and doesn't cover -- before you get treatment. Pay particular attention to procedures and treatments that require prior approval from your insurer. If you fail to get prior approval, your care may not be covered.
Alert your doctor about what's covered under your policy and try to make sure that she knows when prior approval is required. Your doctor deals with many patients and health insurance companies, so you can't expect that she will be as familiar with your health plan as she is with your medical history.
If you are enrolled in a PPO or HMO make sure that you understand your health plan’s policy about using network providers. If you are in an HMO you will not be covered for any health-related services outside the HMO network unless you need some type of procedure that is not available in the network. You will need to get prior approval from the HMO for such services. The same applies for your PPO, you most likely can go out-of-network, but you will have significant out-of-pocket expenses.
If there is anything in your policy that you don't understand, call your health plan's customer service line and ask for an explanation.
Once you file a claim or you have asked for a pre-approval of a treatment, keep all of the records -- provider bills, explanations of benefits notices from your insurer and all other correspondence -- in a folder or paper-clipped together, so you can review them at a glance if the need arises.
If Your Claim is Denied
Start by reviewing your paperwork file. Then call your health plan's customer service line. Often, mistaken denials can be cleared up at this level. Be sure to take notes on all phone conversations, including the date and time of the call, the names of the people you talk to and what was discussed.
If speaking with a customer service representative does not work, you may have to escalate to a formal written appeal.
Your insurance policy will outline the paperwork your health plan requires you to file. You can expect to provide a great deal of information in writing, including copies of bills, your healthcare provider's name, address and phone number, and your physician's statement about why your treatment was or will be necessary.
Many health plans have several steps in the appeal process. If your initial appeal is denied, you most likely will have additional appeals available. The entire appeal process should be outlined in the benefits booklet you received from your health plan.
In many states, you can ask your state insurance commissioner's office to perform an independent review of your dispute. This step is usually taken after you go through your health plan's internal appeals process first.
To find out about an independent review, check your health plan benefits booklet (sometimes referred to as “Evidence of Coverage”), which in some states is required to inform health plan members about appeals options external to the health plan. Another important resource is your state’s insurance department, or agency.
Some health plans offer arbitration, in which an independent third party reviews the dispute and recommends an outcome. Whether the arbitrator's ruling is binding depends on the state and the health plan.
If arbitration is offered under an employer-provided health plan, federal law says you can't be charged for using it.
Be Organized and Persistent
The more information you have, the more likely you are to win your claims denial appeal. Create a paper trail by keeping the following:
- your health insurance policy
- copies of denial letters from your health plan
- copies of any correspondence between you and your health plan, or between your health care provider (such as your doctor, hospital, or lab) and your health plan
- detailed notes of conversations with your health plan
- copies of correspondence with your state insurance department
If you get your health insurance through your employer, you should discuss your claims situation with your company’s benefit manager, who may have some leverage with your health plan.
The Kaiser Family Foundation provides an outline of the external review process for each state.
You can also get more information from your state health insurance department.
This article was co-authored by David Fisher, a freelance writer based in Bend, Ore. In addition to writing and editing he has worked as a financial adviser and held insurance licenses in several states.