Everyone needs medical care and attention at some point in their lives. Routine healthcare visits and care, procedures, and medication become even more inevitable as we age.
Health insurance is like a financial security blanket throughout life’s up and downs—a source of protection from unexpected illness and high medical costs when you or a family member needs preventative or emergency care.
While health insurance gives us necessary access to care, what happens when that coverage is denied?
Insurance providers reject and delay claims for all sorts of reasons, from inaccurate and missing information to the lack of prior authorization to policy limitations to poor business practices. What seems like a minor speed bump can cause a person thousands of dollars.
At Wallace Law, our attorneys see insurance companies make simple mistakes or wrongfully deny and delay claims that cost policyholders to unnecessarily pay out-of-pocket expenses.
Eventually, you might be financially responsible for a medical bill and need to appeal a denied health insurance claim. From better understanding your health coverage to resolving a denied claim to hiring an insurance dispute attorney, the following tips can help you properly navigate the ups and downs of appealing a denied health insurance claim.
What Does Health Insurance Cover?
Most health insurance plans cover a person or family’s care, such as doctor or specialty provider appointments, hospital or emergency room visits, prescription drugs, and medical devices. There are no cookie-cutter health plans, and each pays a set share of costs for the average person or family.
National insurance carriers like Blue Cross Blue Shield, Humana, Aetna, and United Health Care market different levels of care and price points to appease customers. There are usually four types of health insurance coverage plans to choose from, including:
- Health maintenance organizations (HMOs): HMOs deliver health services through a network of healthcare providers and facilities. There is usually less freedom with an HMO when choosing a provider.
- Preferred provider organizations (PPOs): PPOs are similar to HMOs but have higher out-of-pocket costs tied to out-of-network doctors.
- Exclusive provider organizations (EPOs): EPOs are similar to PPOs, though no coverage is provided for out-of-network providers.
- Point-of-service (POS) plans: A POS gives you more access to healthcare providers, similar to HMOs and PPOs.
- High-deductible health plans and health savings accounts (HSAs): A high-deductible health plan can be an HMO, PPO, EPO, or POS, and policyholders are responsible for higher out-of-pocket costs. To offset this, money can be put into a health savings account (HSA) and used tax-free on eligible medical expenses.
A key takeaway is that premium health insurance plans cover more of a person’s health care costs upfront, while basic health insurance plans usually include more out-of-pocket expenses.
How Can A Health Insurance Company Deny A Claim?
Certain factors influence whether a claim gets denied or approved. Medical billing and coding errors are more common than you think, and some insurance companies may try to deny claims to avoid a payout.
Many insurance companies “go by the book” when processing health insurance claims, and the following are some common reasons they get denied or delayed:
- The insurance company flagged the treatment as medically unnecessary, and coverage is not applicable.
- The policyholder’s health insurance policy does not cover the health service and must be paid out-of-pocket.
- More paperwork or documentation is required to determine if the policy covers the specific service.
- The provider is using bad faith tactics and illegally stalling a payout.
- There is a lapse in policy coverage at the time of the service.
- Other reasons might include an out-of-network healthcare provider or non-payment of premiums.
Insurance companies also might only accept a payout if there is an open dispute regarding the policy’s contract terms or if they need to investigate the claim further due to insufficient paperwork. When you need answers, an insurance dispute attorney can clarify unreasonable denial of health insurance claims.
Steps To Appeal a Denied Health Insurance Claim
A denied claim can quickly drain your time and finances without proper direction. There are, however, careful steps to effectively appeal a denied health insurance claim. For example, you can:
- Inquire about the denied health insurance claim and request that your insurance company provide an explanation.
- Review all paperwork submitted and collect additional documentation, such as a provider statement, if necessary.
- Gather all relevant evidence regarding your claim, including medical records, physician notes, or conversations with your insurance company.
- Go through the insurance company’s process, and file an internal appeal to try and reverse the decision.
- If an internal appeal fails, you can file an external appeal for a third-party review.
- Follow up with your insurance company after submitting an appeal to discuss a solution.
- Consult a bad faith health insurance attorney to review your case, help you appeal a denied claim on time, and file a lawsuit if it does not work in your favor.
Our insurance dispute legal services help companies fight unjust health insurance claim decisions daily—and we can help you, too.
When Can I File an Internal Appeal for a Denied Health Insurance Claim?
Policyholders must adhere to three primary steps when filing an internal appeal for a denied health insurance claim.
Step one: File a claim. A claim is a request for reimbursement for the costs of treatment or services.
Step two: Receive a claim denial from your insurance company. Your insurance company must provide a written explanation regarding a claim denial decision following a specific timeline:
- Within 15 days if you are seeking prior authorization for a treatment
- Within 30 days for medical services already completed
- Within 72 hours for urgent health care cases
Step three: Pursue recourse and file an internal appeal:
- Complete all necessary paperwork your insurance provider requires, such as name and claim or policy number and health insurance ID number.
- Submit any evidence or supporting documentation you would like the insurer to consider as part of the review process. This might include physician notes or statements, medical records, and documentation from the insurance company.
Following your insurance company’s procedures is important to avoid further delays, including filing an internal appeal within six months of a denied claim. External reviews can happen simultaneously if you or a family member has an urgent health situation.
When Can I File an External Appeal for a Denied Health Insurance Claim?
Only certain types of claim denials can go through the external appeals process, including experiential treatments, denials involving medical judgments that go against your health insurance plan, or cancellation of coverage due to false or incomplete information.
Insurance companies must follow federal and state guidelines during the external appeals process, but it is wise to consider an insurance dispute attorney to ensure a fair process.
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Denied Health Insurance Claims FAQs
What happens when a health insurance claim is denied?
Insurance companies may deny claims when there is missing or inaccurate information, coverage issues, or policy limitations. In other cases, some insurance companies act in bad faith and deny a policyholder’s claim without a valid reason. Policyholders are entitled to an explanation and can solicit help from a health insurance claim denial lawyer to appeal a denied health insurance claim or file a lawsuit.
What is the difference between denied claims and rejected claims?
A claim rejection happens before the claim is processed, usually because of an error or incorrect or missing information. When a claim is denied, it has already been processed but found unpayable due to policy terms, coverage limitations, or another reason.
What is an expedited internal appeal?
An expedited appeal of a Medicare, Medicare Advantage, or Medicare Part D plan is used in urgent care situations when a person’s life, health, or ability to regain bodily function is in danger. This faster appeal process usually takes 72 hours to 14 days.
What is the No Surprises Act?
The No Surprises Act prevents medical providers and facilities from issuing surprise and often costly medical bills for out-of-network services without prior written authorization. The Act covers emergency and some non-emergency billed services, out-of-network charges, and bills for supplemental care like radiology and anesthesiology.
Do I Need A Health Insurance Claim Lawyer?
Insurance companies do not always play fair, especially if they regularly abuse business procedures and deny or reject claims for the wrong reasons. Denied claims aside, sometimes the problem is a low settlement amount that does not cover your bills.
In either case, you might involve an experienced lawyer for health insurance claims to review your policy more closely or offer advice on whether your insurer is acting in bad faith. Specialized insurance dispute knowledge, trial procedures, and a deep understanding of laws and applicable statutes of limitations can give your case the needed credibility to reach a fair resolution, often much faster than if you did it alone.
Contact a Health Insurance Dispute Lawyer For a Free Consultation
Health insurance claim denials are a roadblock for policyholders. A whopping 90 percent of medical bills have some error; mistakes happen in the claims process all of the time, and sometimes lousy insurance companies delay or reject payment intentionally. How do you cut through all of the chaos?
Wallace Law and our insurance dispute attorneys level the playing field for policyholders up against large insurance companies with more money and legal resources.
When your health coverage is on the line, we ensure insurance companies fulfill their contractual obligations and pay for coverage that is rightfully yours. We have answers to your health insurance claims questions and legal solutions for unfair insurance providers and challenging claims situations.
Resolve your tricky health claim, and contact us today for a free legal consultation.