Receiving the news of denial of coverage of an insurance claim can be an enormous shock, especially if the claim is a large one. However, you should never assume that “no means no” as far as your insurance coverage is concerned.
Appeals are successful in getting claims covered almost 50% of the time, so you should always determine why a claim was denied and follow the process to appeal. Time is of the essence, however, since many insurance companies have a short period under which you can file an appeal.
The first step is to get as much information as possible about your contracted insurance coverage, your claim, and the denial. This process may take some time and effort, but can be well worth it.
Review My Patient Navigator “Understand Your Coverage” Roadmap
Confirm that the service/procedure is one that is covered under your plan.
Was prior authorization required under your plan and was it obtained?
If you are required to obtain authorization by your insurance company for a test or treatment and did not, then they have grounds to deny your claim.
You can still appeal the denial if there were extenuating circumstances, such as a medical emergency.
Do you have a co-pay or deductible to which your claim was applied?
For example, if you have a $20.00 co-pay and $1,000 deductible, and a bill for a $420 medical appointment, you will be responsible for paying the entire $420 to the provider. $20 will be considered your co-pay, and $400 will be credited toward your deductible.
Was the service provider in-network or out of network?
In-network providers usually have contracts with the insurance company that defines the amounts they are allowed to charge patients, and the insurance company usually covers that amount. Depending on the providers’ contract with the insurance company, you should not be required to pay the difference between the allowable (covered) amount and the actual amount billed. This usually appears in your bill or EOB as a write-off.
The rules of coverage for out-of-network providers vary widely among different insurance companies. Just because a provider is out-of-network doesn’t necessarily mean that his/her services will not be covered to some degree.
For questions on these terms, review the My Patient Navigator “Glossary of Insurance Terms” Roadmap.
Insurance companies are required to send one to you for each claim that is submitted. If you have not received an EOB, call the Member Services number on the back of your insurance card and ask about it. You may be able to access the form electronically through the insurance company’s web portal, or they may send you a copy through the mail.
The EOB will usually include:
Pay particular attention to the codes used by the insurance company in the Remarks section, which explain what was covered and why. If the entire claim was denied, these codes will reveal (but not necessarily explain) the insurance company’s reason why.
If the denial comes from the provider it may be because there was an error in the information the provider submitted on the claim – perhaps a digit in your Social Security Number is wrong, or your name is misspelled, or your Date of Birth is wrong, or it was submitted to an old insurer in error, or your primary insurer was not billed firs.
There is a toll-free number listed on the back of your insurance card. Tell the Service Representative that you have a discrepancy between a claim filed and the amount paid/covered, and you wish to understand why the claim was denied. The representative will access your information and should be able explain why the denial was made. Always get the name of the person to whom you are talking, and record the date and time of the discussion.
The reason for denial may be something easy to fix, such as the claim was filed with an improper or outdated billing code, or it may be more complicated.
When it appears that a denial was not justified, then an appeal should be filed.
Every EOB has the Appeals Procedures detailed on the back of the form.
Alternatively, you can usually access this information on the company’s website or by speaking to a Member Service Representative.
That statement may be taken as the appeal itself and start the clock ticking. Make it clear that you are not starting the appeals process at that time. You need to take the time to gather the necessary information and present it to the insurance company in an optimum manner.
Make sure you know what your deadline to appeal is – usually 60, 90 or 180 days after you are notified of the denial of benefits.
Follow the insurance company’s rules for appealing; understand your basis for the appeal.
Customize your appeal to argue specifically against the reason for the denial of your claim.
These are some common reasons for appeal:
Procedure/medication tried after all others failed
Out-of-Network provider only one available within reasonable distance
Out-of-Network provider only one skilled at particular procedure
Test necessary because all others were inconclusive
In preparing your appeal, you must gather all possible data that will demonstrate why your appeal is justified.
When writing an appeal letter, write a clear statement of the reason the claim should not be denied, your support of that reason and the action you wish the insurer to take. It is essential to write a strong, factual and unemotional letter and to include documentation.
Make sure to include:
Insurance ID number
Claim Number(s) shown on EOB
Date(s) of services provided
Amount of the Charge(s)
Reason for denial of claim
Your reason why denial of claim was inappropriate, and documentation supporting your reasoning
Request for a specific resolution, i.e full coverage of claim within 30 days
Enclose: Copies of EOB, relevant pages of Summary of Benefits, Letters from Doctor(s), Medical records, Test Results and other relevant documentation
Make sure to send your letter via certified mail, with a signature receipt requested. Verify the address to which is needs to be sent, as the appeals address is usually different from the normal claims address.
If you are asked to send your documentation by fax, make sure to follow-up by phone to ensure that it was received and logged.
Step 5. Do Not Give Up
Sometimes a second or third level appeal is necessary. You still have options, depending on the type of insurance you have. A re-submission of your appeal with additional documentation can be successful where the first may have failed. Go to the next level when necessary!
You also have the option to take up the matter with your state’s independent external review board, after all internal appeals have been exhausted.
Your Patient Navigator can provide further guidance on options available to you if the initial appeals process has failed. Contact our office for help.
Links to Research Justifications of Medical Necessity
National Guideline Clearinghouse (make sure the guidelines are current, less than five years old)
Drugs@FDA (a catalog of FDA-approved drug products)
The American Hospital Formulary Service Drug Information (your doctor or pharmacist may have a subscription to this resource)
DRUGDEX Information System (your doctor or pharmacist may have a subscription)
Patient organizations for specific disease/disorder (link to Finding Resources roadmap)
A Consumer Guide to Handling Disputes with Your Private or Employer Health Plan (includes a State by State guide to external review processes)
Medicare Rights Center - 800-333-4114
Patient Advocate Foundation – 800-532-5274
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