When people purchase a health plan, they expect it to cover their medical bills appropriately. However, there may be instances when the insurer denies the claim and refuses to pay for the medical treatment. Typical reasons for a denial are – the treatment was “experimental,” or “medically unnecessary,” or “not covered by the health plan.” Medical claims review is an important part of claim processing and helps determine the legitimacy of the claim. The health plan may deny coverage for medical services already received, or refuse to provide authorization for a procedure or specialist consultation. While most claims are paid fairly based on the medical evidence available, there may be occasions when even valid claims are denied. Before taking a legal step against the insurer, there are a few things plan holders must consider to avoid unnecessary legal hassle and confusion.
Plan holders must have a clear understanding about what their plan covers and doesn’t cover. They should also be aware about the formal procedures to follow so that they are ensured coverage. There are two important things to read and understand, namely, the Summary Plan Description and the health plan’s Evidence of Coverage which constitutes the comprehensive description of the plan. This will provide the information necessary to determine whether your complaint is authentic and worth pursuing. One example of lack of knowledge regarding the plan is when a plan holder doesn’t know that he/she needs to obtain a referral before seeing a specialist and fails to do so. In such a case, the health plan will naturally deny coverage for the visit to the specialist. Good awareness of the plan details will also help you quote the pertinent part of the contract when arguing that the claim was unfairly denied.
Now, there are the copayments and deductibles to consider. The plan holder must have a clear understanding about what their payment obligations are. They should know what copayments are due for office visit, hospital visits, surgery, and other procedures. In some health plans, the participants have to pay the entire cost of the medical services until they reach a certain dollar figure which is called the deductible, for e.g. $500. The health plan coverage will start only when the required deductible is spent in any given calendar year. If the deductible is rather high, it is all the more important to monitor the deductible status. The wise thing to do if you reach the deductible amount in a given calendar year is to consider having any other costly procedures or services done that same year instead of waiting until the next year. The next year you will have to meet your deductible all over once more. Also, meet all requirements related to pre-certification and the use of network providers.
So, once you are sure you understand all features of your health insurance plan and still believe your claim was unfairly denied, the next step is to contact the health plan’s customer service agents. They may be able to approve services that were wrongly denied or correct an inaccurate charge. You may be asked to submit more documentary proof such as a letter from your treating doctor, or documentation that the insurer’s office says they have not received.
You can request the health insurer to give a notice of claim denial and a statement explaining the reason for the denial.
In case the customer service agents are unable to resolve your problem, the next step is to request an internal review or appeal. A formal request has to be made to change their decision regarding the denial. Typically, your Evidence of Coverage should provide details regarding how to start the appeals process as well as the time limits for initiating it. The insurer is expected to respond to the appeal within the time period specified in the Evidence of Coverage. If the health plan returns an adverse decision, you may be able to request review from an organization outside of your health plan. This arbitration clause is included in some health plans and using this, the plan holder can submit his/her disagreement regarding the health plan’s decision to an objective third party. This external agency would review both sides’ positions and make a decision.
It is important for plan holders to allow sufficient time for the insurer to process the claim. The majority of health plans want to ensure fair reimbursement and prevent any fraudulent claims from getting paid. They utilize the service of experienced attorneys and medical records services to determine the legitimacy of the claim. Usually, they notify the plan member if they need any additional information to complete the claim. Sometimes, they may ask additional information from the treating physicians or even return the claim to the plan holder to obtain more relevant information. Once all the information is made available, the company has a certain number of working days to process the claim. When the processing is complete, they would send the plan holder an explanation of benefits stating their decision. Before filing a lawsuit against the health insurance company, there are the above-mentioned formal procedures for a health plan member to consider.