What Should I Do if I've Been Denied By A Health Insurance Company?

If your health insurance company denies you, you have the option to appeal their decision. Utilizing an internal or external review, you can appeal your insurance company’s refusal to pay a claim or even end your coverage. Understanding why you were denied, the terminology surrounding insurance claims, and the appeal process are essential. 

How To Appeal A Health Insurance Denial

Upon being denied, your insurance company will always give you the right to appeal the decision through multiple options. When initiating this process, it is crucial to understand why you were denied, comprehend the terminology related to your claim, and then understand the two types of appeals. When your claim has been rejected, your health insurance company terminated your health coverage or refused your medical claim. In short, insurance will not cover the cost of the respective medical services.

Step 1: Understand Why You Were Denied

Insurance companies are required by law to tell you exactly why you were denied and inform you how to appeal their decisions. In 2020, about 18% of in-network claims through Healthcare.gov insurers were denied. PatientAdvocate.org outlines what your insurance company must provide to you upon their denial letter:

• Information on your right to file an appeal
• The specific reason your claim or coverage request was denied
• Detailed instructions on submission requirements
• Key deadlines to submit your appeal
• The availability of a Consumer Assistance program (if available)

A Consumer Assistance Program (CAP) may be available in your state, and you will be notified in your denial letter if so. This program is available in multiple states to help you file an appeal or request a review of your health insurance company's decision. If your resident state doesn't offer CAP, you can utilize resources such as the U.S. Department of Labor and your state's Department of Insurance. 

There are multiple reasons why an insurance company may deny your claim or forfeit your insurance. PatientAdvocate.org also outlines the most common claim denial reasons as:

• Your medical services are deemed not medically necessary
• Your services are no longer appropriate in the specific health care setting or level of care
• The medical treatment requested has not been proven effective
• You are not eligible for the benefit requested under your specific health plan
• Your services are considered experimental or investigational
• Your claim was not filed promptly

Step 2: Understand Insurance Terminology

Understanding insurance jargon is essential to understanding your claim denial letter and appealing. Knowledge is power, and the more you comprehend your insurance policy, the more you can avoid claim denials in the future and combat any current refusals. Some important terms are claim, itemized hospital bill, and health insurance claim denial.

Step 3: Appeal Process

There are two main ways to complete a health insurance claim denial. These include completing an internal appeal or an external review. You can only initiate an appeal upon receiving a claim denial letter from your insurance company.

Internal Appeals

Internal appeals are completed between yourself and your insurance company. Everyone has a right to an internal appeal if their claim is denied or their coverage is canceled. You are responsible for asking your insurance company to conduct a thorough and impartial review of their initial decision.

The time you must complete your internal appeal is different depending on whether you've received the service or not. You have 30 days if your appeal is for a service you have not yet received and 60 days if your appeal is for a service you have already received. Healthcare.gov outlines the three steps in an internal appeals process:

1. File a Claim
2. Your Insurance Denies the Claim
3. File an Internal Appeal

There are specific time requirements that your health plan must meet when denying your claim. These include notification in writing within:

Source: Healthcare.gov

When filing an internal appeal, you will use your health insurance company's mandatory information and requirements. To complete the process, you must complete all forms required by your health insurer and submit any additional documentation you feel is relevant. Other documentation can include a letter from your doctor detailing your condition and the context of the claim. 

If you are having a challenging time filing your appeal, you reach out to the Consumer Assistance Program (if applicable) in your state to assist with filing your appeal.

Internal appeals must be filed within 6 months of receiving your claim denial notice. If you have an urgent health situation where a decision is needed, you can ask for an external review to be completed simultaneously.

External Review 

External reviews usually take place after an unsuccessful internal appeal. You ask an Independent Review Organization (IRO) to reevaluate the initial decision made by your insurance company to refuse coverage. There are two main steps in the external review process:

1. Filing an external review
2. The external reviewer issue the final decision

You must file a written request for an external review within 4 months of receiving the final claim denial. The process to initiate an external review will be detailed in your final internal appeal denial or on your Explanation of Benefits (EOB) within your health plan. Your health insurance company will provide you with the contact information for the organization handling your external review should you proceed.

The organization that completes your external review will either uphold your insurer’s decision or decide in your favor. Your insurer is required by law to accept the final decision made by the external reviewer. Healthcare.gov lists some instances in which denials will move for external reviews:

• Denials involving medical judgment where you or your provider may disagree with the health insurance plan
• Denials involving a treatment that may be experimental or investigational
• Cancellation of your coverage based on false or incomplete information when you applied for coverage

There are two different types of external review requirements, federal and state. However, insurance companies in all states must meet federal requirements, but the reverse is not necessarily true. 

Your respective state may have an external review process that meets or exceeds federal standards. If true, your insurance company will follow your state’s external review processes. Now, if your state does not have an external review process that meets the minimum federal standards, the government’s Department of Health and Human Services (HHS) will manage an external review process for all health insurance companies in your state. This HHS website lists the states that meet and do not meet minimum requirements.

Health Insurance Denial Frequently Asked Questions (FAQs)

Consider this additional information when it comes to being denied by a health insurance company. 

Can I Re-Appeal?

Once you reach the external review process and receive a decision, it is final. Decisions made by the external review organization are final and binding for you and your insurance company. 

What If I Don’t Have a Consumer Assistance Program in My State?

If there is no Consumer Assistance Program available in your state, many other options exist. Many other organizations and websites readily offer information on the appeal process, and people can speak with you to clarify the procedure. The Livestrong website lists many links that will take you to helpful resources to complete the appeal process.

What Should the Format of My Appeal Letter Be?

Your insurance company will provide you with appeal instructions upon denying your claim. However, it is essential to be clear, concise, and grammatically correct when writing the actual letter portion of your appeal. This website provides great tips and templates to help write your appeal in the most effective way possible.

Bottom Line

You have the right to appeal a denied health coverage claim. Starting this process as soon as you receive a denial letter from your insurance company is crucial. You can then file an internal appeal or an external review. Understanding the reasoning behind your initial claim denial is essential so that you may file a more thorough appeal and get your medical services covered.

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