What happens when the health insurance company won't pay my medical bill?
Well, the good news is that you have rights and options. The ACA established a bunch of rules and regulations protecting consumers from decisions made by insurance companies. Among these rules, there are clear cut protections against denials of coverage.
**Please note, the information presented here pertains to health insurance plans that are considered MEC by the ACA. The process for appealing a claim with Medicare is slightly different**
ACA protections
What exactly did the Affordable Care Act set in place that helps ensure the insurance company pays?
- Insurance companies are required to tell you exactly why your claim was denied, and how you can appeal their decision. Prior to the ACA, your claim could be denied and there wasn’t a lot that you could do about it; you were more or less at the mercy of the insurance company.
- Insurance companies are not allowed to deny coverage for pre-existing conditions. Way back when, if you had a medical issue BEFORE you got your insurance, that insurance may decide to not pay for that prior problem. That was their right; now the law required them to pay for ALL conditions normally covered under the policy. As crazy as it sounds, there was a women in LA that in 2008 it was retroactively decided her insurance was cancelled AFTER she had racked up almost $130,000 in medical bills. This forced her to stop chemotherapy because the insurance company decided she cost them too much and denied her claim.
- Insurance companies can no longer deny coverage because you have gone over pre-set limits. In the past, you had both lifetime limits and annual limits, and if you surpassed these, the insurance company would stop paying, saying that you cost them too much. They are no longer able to do this.
- Claims can no longer be denied due to unintentional mistakes on your part. There were a lot of reasons claims could be denied; maybe you misspelled a name or inverted birthdate numbers- these were all valid reason to deny payment.
- You can no longer be denied if you sought emergency department services too many times or didn’t ask for prior approval first or because you were out of your network.
So why are claims still denied?
Claims still do get denied unfortunately. There are any number of reason a health plan might deny payment. Some are simple and relatively easy to fix, while some are more difficult to address.
Common reasons for health plan denials include
Paperwork errors
Clerical or coding errors such as information not being entered correctly happen. This can include your personal information or eve the the provider’s information. Sometimes a procedure is coded incorrectly as a bundled procedure, where overlapping components aren’t properly billed. These issues are usually sorted out.
Questions about medical necessity
There are two possible reasons for this, you either really do not need the requested service (so it’s an elective), or you need the service but you haven’t convinced the insurance company that you do (so you need to get more referrals).
Cost Control
This happens when the insurance company want you to try the less expensive option first, and if that doesn’t work, then move on to the more expensive plan. Step therapy for prescription drugs is a common example of this.
Your requested service isn’t covered
This could be something that is considered cosmetic or perhaps not yet approved and considered a trial. This can also happen if you state does not regconize the procedure as part of what is covered under essential health benefits, such as acupuncture or chiropractic services.
You went out of network
Depending on your health plan and how it is structured, you may only be covered for services provided by providers inside of your plan’s network. If this is the case and you go out-of-network, you plan may deny your claim for payment.
EPOs and HMOs generally will not cover out-of-network expenses unless it is an emergency, where as a PPO will cover the procedure, but a separate deductible will apply. The No Surprise Act of 2022 prohibits some balance billing in emergency situations, but it is still allowed if you knowingly seek care from an out-of-network provider.
You did not follow the plan’s rules
This commonly occurs when the plan ask you to get pre-authorization for a service and you do not that. If yo choose to have the procedure done without the companies ‘ok’ first, you may be denied because you didn’t follow the plan rules, even if you really needed the service. The insurance companies are sticklers for rules, and this is a pretty hard one to fight for that reason.
No matter the reason, the insurance company has to provide you with the ‘why’ and explain how you can appeal their decision.
So what do I do about the denial?
Your health plan denies your claim. It’s frustrating and expensive and you want to push the issue and make them pay, how do you do that?
Step one- Ask the insurance company to reconsider
This sounds obvious, but the first thing to do is to call the insurance company and just ask them pay. Now the reason for this is that they are required by law to tell you why your claim was denied and what you can do to dispute their decision.
The time frame that the insurance companies must adhere to in telling you why, in writing, are;
- Within 15 days if you’re seeking prior authorizations for treatment
- Within 30 days for medical services already covered
- Within 72 hours for urgent care cases.
Step two- decide how you want to appeal
There are two ways to appeal a health plan decision, and internal appeal and an external appeal.
Internal appeal
If your claim is denied, and internal appeal is when you ask the insurer to review their decision. Each insurance company has a slightly different process on how they handle appeals, and specifics on where you can find the documents you need and where to send them will be located both in your policy documents and on the denial letter you would have received from the insurance company.
You will need to complete all forms required by your health insurer and submit any and all additional information that you want the company to consider, such as letters from a doctor. Your state Consumer Assistance Program can help you with all of this. You will need to have this filed with the insurance company 180 days from receiving notice that you claim was denied.
This process can take time unfortunately. ACA specifies that the insurance company has 30 days to complete their review if the service has not yet been completed, 60 days if the service has been completed, and 4 business days if you file an expedited appeal under grounds that a standard appeal process would jeopardize your life.
Make sure that you keep all the paperwork and information related to this claim and denial for reference later down the road if needed. The paperwork that you will need includes
- The explanation of benefits you received. This is a letter that the insurance company would have sent you showing what payments where approved and/or denied. You receive one of these for every procedure, regardless of it is approved or denied.
- A copy of the request for appeals that you sent the insurance company
- All documents you sent supporting your position, such as letters from doctors.
- A copy of the form that you will be required to sign if you had someone else help you file the appeal.
- All notes with dates about any phone conversations you may have had with your insurance company or your doctor that may relate to this appeal. Make sure to be details and include names, titles, dates, and times in addition to the specifics of the conversion.
**Keep the originals, only submit copies**
The actual appeal itself will need to be the original, so make a copy and keep that for your records. But everything else, make sure to make a copy of and send the copy only.
External appeal
This is when you seek out an independent third part and usually comes after an internal appeal failed to convince the insurance company to pay the claim. When this happens, the insurance company no longer has any say if the pay the claim or not and is required by law to uphold the decision of the external reviewer.
Only certain types of denials can go to external review. Those include;
- Denials that involve medical judgement where your provider and disagrees with the insurance company.
- A denial where the treatment is experimental.
- Cancellation of coverage based on your insurer’s claim that you gave false information when you applied for coverage.
The review process for external appeals varies depending on where you live. Insurance companies are required to follow a process that meets the federal consumer protection standards, but depending on which state you live in, your state may go above an beyond these guidelines. If you state is stricter than the federal standards, then your state board will handle the external review, otherwise the process is handled by the federal Department of Health and Human Services.
When you look at the Explanation of Benefits given to you on the final denial from your internal appeal, there will be information given on who to contact for an external review. You can also visit CMS using this link for help filing a request, or call 1-888-866-6205 to request a review over the phone. Request for review can be faxed to 1-888-866-6190 or emailed to ferp@maximus.com.
You may appoint a representative, such as a doctor, to file the review on your behalf. Te form needed for that can be found here.
External appeals last no more than 45 days after the request was processed and if they are expedited they take no more than 72 hours.
If you need help filing an appeal, internal or external, your state’s Consumer Assistance Program, the Department of Insurance, or Healthcare.gov are all great resources to take advantage of.
Takeaway
There is understandably nothing more aggravating that needing to battle an insurance company over a bill. Fortunately, the ACA has taken some wonderful steps on helping consumers by outlining the process of appeals and upholding a minimum standard that all insurance companies must adhere to.
While the process still takes time and can be frustrating, having option and rights a slew of programs designed to help you can often lead to an approved claim. If you would like any help in getting started in filing an appeals or have questions regarding this or any other topic, feel free to reach out to us and we can talk.
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