How to appeal a health insurance claim

Appealing claims that are rejectedDistinguishing between accidents and illnesses in the emergency room

Sometimes you may disagree with your health insurance plan’s payment of benefits. This post teaches you how to appeal and where to turn when that happens.

Some health insurance plans attempt to control costs by refusing payment for emergency room care unless you first get permission from your doctor. Sometimes emergency room staff delays treatment while they check your insurance coverage. Legislation now establishes certain rights for emer­gency room patients, which minimizes these kinds of restric­tions. This post explains your rights to emergency room treatment under these laws.

If you object to the way your insurer paid your claim, start by calling your plan’s benefits administrator, if you have one, or check with your human resources department. If your objections are still unresolved, your next step is to file an appeal — a means of objecting to the way the insurer paid your claim and requesting the insurer to reconsider the claim.

Check your health insurance policy for a section on the appeals process. Your plan may spell out each step that you must follow to appeal your claim. Be aware of deadlines that you must meet to resubmit a claim, or you may lose your right to appeal.

Follow up on the response you receive from the insurer. Read it carefully and make sure that the insurer bases its decision on the correct information. If you discover that some of the infor­mation you submitted on your original claim is incorrect or inaccurate, notify the insurer in writing of the correction.

Mail correspondence by certified mail with a return receipt to confirm that the insurer received your letter.

If the insurer continues to deny benefits, submit copies of the claim, correspondence, notes, and the relevant pages of your policy to your state’s insurance department. Remember to include your policy or claim number. Write a cover letter explaining in detail why you think the insurer did not prop­erly pay benefits for your medical expenses.

The department of insurance notifies the insurance company of your complaint. The insurer must then respond to the state insurance department within a specified period, usually 10 to 30 days. After the insurance department receives the insurer’s response, it investigates and comes up with a solu­tion, if possible. Expect this process to take at least 30 days (longer if the case is complicated).

As you work through the appeals process, keep in mind that each state has its own laws — usually referred to as the Unfair Claims Settlement Practices Act — to protect you from unfair and deceptive practices in the insurance industry.

For more information on your particular state’s laws, contact your state’s insurance department. To find your state health insurance contact, check with the National Association of Insurance Commissioners.

Although the insurance protection laws differ from state to state, most of them have the following provisions in com­mon. The laws state that insurance companies

Must not intentionally misrepresent facts or provisions relating to coverage under your policy, such as stating that a condition is covered when it isn’t.Must acknowledge your claim and act promptly in response to your communications about your claim.Must put into action standards for timely investigation and processing of claims.Must not attempt to influence payment of a claim you make under one benefit provision (such as a hospital benefit) by delaying payment under another (such as a prescription drug benefit) when the amount the com­pany owes you is clear.Must not delay an investigation or payment of claims by asking you for reports or forms that are unnecessary or contain information that you’ve already submitted.Must not force you to file a lawsuit to recover money due under an insurance policy by offering you considerably less than the money ultimately recovered in a lawsuit.Must not, as a policy, appeal arbitration awards in your favor to force you to accept a settlement amount or com­promise for less than the amount awarded in arbitration. Both sides choose one independent third party, such as a judge or lawyer, to determine the outcome (arbitrate). The decision the arbitrator makes is usually final.Must not refuse to pay your claim or delay payment without conducting a reasonable investigation and giv­ing you a valid reason.

If you think that your insurance company is violating the Unfair Claims Practices Act, talk to a claims supervisor at the company and explain your concern. If that doesn’t help resolve your problem, file a complaint with your state’s insur­ance department.

The state insurance department can help only if the insur­ance company has broken the law. It can’t force the insurer to provide a benefit that isn’t in the health insurance policy. Many state insurance departments try to resolve the com­plaint by phone before the consumer resorts to filing a for­mal complaint.

If you hire a lawyer to resolve your complaint, the state insur­ance department won’t speak with you directly. As your legal representative, your lawyer speaks for you.

If their finding is against the insurance company, state insur­ance departments have the authority to impose penalties on an insurance company, ranging from assessing a fine to revok­ing the company’s state license.

The Emergency Medical Treatment and Active Labor Act of 1998 (EMTALA) states that hospitals must give appropriate care to people regardless of their ability to pay, including peo­ple whose health insurance coverage restricts emergency room benefits. Hospital staff can’t postpone examining a patient while checking on insurance coverage or while trying to get permission from a doctor in the patient’s health plan network to examine or treat the patient.

Individual state laws may offer rights in addition to the rights in EMTALA. Some states have a regulation that requires insur­ance companies to pay for emergency room care if a prudent layperson (a person with an average knowledge of health and medicine) acting reasonably would consider the situation a medical emergency.

Emergency room staff must do a medical exam before send­ing you to a clinic or doctor’s office. The exam determines whether you need immediate care and avoids putting your health at risk. If emergency room doctors determine that you have an emergency medical condition, they must stabilize or appropriately transfer you to another medical facility.

EMTALA defines an emergency medical condition as a medical condition with symptoms so severe that you could reasonably expect the lack of immediate medical attention to result in

Seriously jeopardizing a patient’s or unborn child’s health (in the case of a pregnant woman)Seriously harming any bodily functions or parts

When a pregnant woman is having contractions, EMTALA considers it an emergency when

There isn’t enough time to safely transfer the pregnant woman to another hospital before giving birthTransferring the pregnant woman may threaten her health or safety or the health or safety of the unborn child

If your condition doesn’t meet the definition of “emergency medical condition,” the hospital emergency room doesn’t have to treat you.

How to Fill Your Health Insurance Claim Form

Keeping track of family health history and medical recordsUnderstanding coordination of benefitsIncreasing your chances of getting your claim processed the first time around

This post stresses the importance of keeping good med­ical records to make sure that you file accurate claims. This post also explains the standards that determine how insur­ance plans determine which plan pays first. If you have more than one insurer, knowing the order in which to file your claim can save time and money.

With accurate, up-to-date records, filling out the claim form (a request to pay your medical expenses) should be simple and painless. Correct information on the claim form also lessens the chance that the insurance company rejects your claim or returns it for additional information.

For each person in your family, keep a record — in chrono­logical order — of each event related to a particular condi­tion. The record should include enough information to make reconstructing the details of a condition easy for you. Include summaries and dates of pertinent telephone conversations and correspondence. Keep the form in a file folder and add the appropriate paperwork — copies of bills, receipts, corre­spondence, prescriptions, and the like — to the file.

Table 7-1 shows an example of such a record. You can change or add to the categories to reflect your own needs. Fill out the record in diary fashion, entering first the date of the next event with the appropriate corresponding information and notes. Add pages as necessary.

Table 7-1: Troy Family Health Record

Claim Information                           Family Member

Name of patient                                  Helena

Date of birth                                       10/9/54

Social Security number                       111-22-3333

Name of insurance company               Happy Health Insurance

Insurance policy group number           0700-131886

Your insurance ID number                  123-45-6789

Date of service                                   1/1/2000

Diagnosis                                           Flu

Name of provider, correspondent Dr. Gary

Address and telephone number           Dean Medical Center,

for provider, correspondent                 1541 Market; 555-4321

Description of services,                      Saw Helena, prescribed

prescriptions, telephone                      light diet, bed rest

conversations, correspondence

Notes, comments, questions                  Requested medication but

the doctor thought we should wait a day or two

Cost of service                                   $65

Amount you paid                                 $15 copay

Amount submitted to the                     $50

insurance company

How much the insurance                     Nothing: Applied the $50

company paid                                     to the deductible

Balance due                                       $50

Date paid balance due                        2/5/2000

Claim Information                           Family Member

Date                                                   1/5/2000

Description of services,                      Saw Dr. Gary again, who

prescriptions, telephone                      said that Helena didn’t

conversations, correspondence           need any medication; she

looked much better

Cost of service                                   $30 for follow-up visit

And so on

You may also want to keep another set of records for each person in your family that covers health history, showing ill­nesses, injuries, medications, immunizations, and their cor­responding dates. For a complete family history, record your parents’ and other relatives’ health information as well.

The standards also regulate the amounts that each insurer must pay. The primary insurer pays as it normally would for covered charges. The primary insurer then submits a state­ment of the benefits it paid to the secondary insurer before the secondary insurer pays. The secondary insurer picks up the charges for the deductible and coinsurance or copayment. The secondary carrier also pays for benefits covered in the secondary plan but not covered by the primary plan.

If you have more than one health insurance policy, be sure that you understand how the plans will coordinate your ben­efits. Carefully check each plan to understand how and when to submit insurance claims, as well as which plan to send them to first.

The definition of “coordination of benefits” refers to group plans only. Individual plans don’t usually include a COB clause, although every state has its own regulations govern­ing COB with individual plans. In this case, a person with both a group plan and an individual plan who submits the same medical expenses to both plans may receive duplicate benefits. Although this prospect may sound like a good idea, remember that premiums for individual plans are very high, so you may not come out ahead financially.