 |
Handling Insurance Problems
Even the most detailed insurance plans contain some gray areas. For example, your policy may pay for "medically necessary" treatment. Who says what is medically necessary? To your doctor, weight-loss counseling may be essential to prevent heart attack; to your insurance company, nutritional services may be optional.
Also, it's important to know your rights. If you develop an illness, can your insurer alter your coverage?
Here you'll find an overview of your rights and how to exercise them ... whether to appeal an insurer's decision or file a complaint.
Know your rights
Whatever your insurance policy, you have federal and state protections. Your specific safeguards are determined by your insurance type and state of residence, so we've included resources to help you get information tailored for your situation.
Also, please note this is an overview. Check with your company's benefits administrator
or your state insurance department
to see how they apply to your situation.
Loss or alteration of coverage
If you develop an illness or medical condition, under the federal HIPAA law your insurance company cannot use this as a reason to drop you from their plan.
However, if other reasons come into play — such as nonpayment of your premium — your policy could be dropped regardless of your health condition.
Lastly, your state may mandate that the elements of your plan, such as the types of prescription drugs covered, can't be changed in the middle of a plan year.
If you have individual insurance
If you have purchased your own insurance in the individual market, you are protected by state law. For example, many states have instituted a patients' bill of rights. For details on your protections for obtaining and retaining health coverage, check out information for your state.
If you have employer-provided insurance
If you've obtained insurance through the company you work for, you're probably covered by the federal Employee Retirement Income Security Act (ERISA). This law sets legal guidelines for private employee benefit plans.
ERISA mandates that your insurer must:
- Inform you about your plan's provisions, including how to file a claim
- Tell you how to appeal a claim if it's denied
- Provide a special process for reviewing appeals
If you would like to know how ERISA applies in your case, talk to your company's benefits administrator.
State laws may also apply to your situation — for example, your state may limit how much the costs of the plan can be raised each year.
Appeal a decision
The process of filing an appeal for a denial of coverage varies from plan to plan, so you'll need to check your summary plan description for specific steps. However, here are some tips that can increase your chances of winning.
Keep detailed records of every step.
- After every phone call related to your claim, write down the names of the people you spoke to, the date, and what they said.
- Follow up each call with a letter summarizing the conversation.
- Keep copies of all records, including every notice and piece of correspondence — whether by email or letter.
Ask your insurer to justify the decision you are appealing in writing.
- Look carefully at the company's legal and medical justifications. This will help you challenge them point by point.
- Request that the company cites a specific section of your policy. If the plan can't cite a specific justification, the decision may well be invalid.
- Ask about the medical background of the person who made the "denial" decision.
Include several key elements in your appeal.
- List the treatment or service you need.
- Include the date the treatment was stopped or coverage was denied.
- Give the plan's stated reason for denying the treatment.
- Explain why you think the decision should be overturned.
- Include all of these elements regardless of whether the insurance company's appeal form (some companies have one) asks for them.
Consider some strategic moves.
- Ask your doctor to write a letter explaining why the treatment is necessary. If your doctor won't help, consider seeking a second opinion.
- If you have job-based insurance, ask someone in the benefits department to support your appeal — this adds your employer's weight to your complaint.
File your appeal on time — and in duplicate.
- Submit your appeal and any supporting letters or documents before the deadline — otherwise you may lose your right to appeal.
- Deliver a copy to the plan's medical director as well as the person listed in your summary plan description.
- Be courteous. The director has the power to change the decision and could potentially decide in your favor, cutting the process short. Your insurer would rather come to a friendly agreement than begin a potentially expensive process to resolve your appeal.
ERISA protections for job-based insurance
If you have employer-based insurance, you have an additional protection. The federal
ERISA law requires insurers to:
- Maintain an impartial process for reviewing appeals
- Meet certain deadlines in returning decisions on claims and appeals
- Speed up the process if your doctor declares your claim urgent
- Give you at least 180 days to file an appeal
If you have a grievance, see detailed information about filing appeals under ERISA.
File a complaint
If your appeal of a claim decision is unsuccessful, your state's insurance authority may be your last shot at getting the treatment or service covered. Your state may give you the chance to have your claim reviewed by an external panel of experts. The panel's decision becomes the final word in the case.
Learn all the protections for your state. Some states, for example, allow patients to sue their managed care plans for malpractice if a claim or treatment is denied. Also see information about your state's laws for handling disputes.
Self-funded plans — the big exception
If your company pays employees' medical bills and takes on the risks of insurance, you are enrolled in a self-funded plan. In that case, the legal system is the only potential recourse for disputing claims beyond the internal appeals process and that's not an attractive option for obvious reasons. Contacting your human resources department for help resolving your issue might be the wisest course.
Since most self-funded plans are administered by insurance companies, you may not know whether your plan is self-funded. Your company's benefits administrator can tell you how your plan is structured.