Understanding the Appeal Process
A denial by your insurance company indicates that they have
decided not to pay for the claim or service recommended by your
physician. Often a claim denial can be attributed to errors or
incomplete information. In these cases, you or your doctor can
simply make the necessary corrections and resubmit the claim or
request. Even if you follow prior authorization and claims submission
processes accurately, your insurance company may still deny your
request for coverage. It is important for you to remember that
an initial denial is not final and may be overturned if you appeal.
An appeal is a request to your
insurance company for review of a denied claim or service.
Why would my insurance not cover a treatment?
There are numerous reasons that insurance companies may deny
services or claims. It is important to review the reason your
specific service or claim is denied as it assists you in determining
your next steps. If a prior authorization is denied, you and/or
your medical provider should receive a letter stating the reason
for denial. If you have received services and the claim is denied,
you and/or your medical provider should receive an Explanation
of Benefits (EOB). This is a statement that shows the services
your physician billed to the insurance company, the portion of
the charges the health plan covered, and the amount of your out-of-pocket
costs. If a portion of the claim was denied, there will be an
explanation detailing the reason for the denial. Carefully review
these statements and use them to assist with submission of an
appeal. Here are some of the most common scenarios for service
or claim denials you may encounter:
Services are not covered by your health plan
Some insurance companies will not cover specific services or
types of treatment. If you receive a denial for prior authorization
or a claim stating that the service is not a covered benefit,
call the insurance company to verify the services they show you
have received and the coverage exclusions of your plan. Review
this with your provider to ensure the service was filed correctly
and determine your next steps for appeal. (See section entitled
Grievance Process.)
Medical Necessity was not established
A prior authorization or claim may be denied if the insurance
company does not feel that the service you are requesting or received
is appropriate for your condition and/or diagnosis. Many health
plans require you to try several treatment options prior to covering
more costly alternatives. You may need to work with your provider
to collect all previous medical history and chart notes to submit
with an appeal in support of the reason for the prescribed service.
Documented proof of medical history will support any information
you provide in a letter to the insurance company. You may also
wish to try contacting the manufacturer of the product you are
being prescribed as they can often provide you with a copy of
the package insert and results from the clinical trials to demonstrate
efficacy and possibly cost effectiveness compared to other treatments.
Real Life-
"I needed my daughter to have a pediatric PPH specialist,
rather than just a pulmonologist…I submitted a request in
writing to the lady with the insurance company who handled
my company's health insurance plan. It was initially denied.
I then wrote to several PPH Doctors asking for letters backing
up my position that it was medically necessary to have a PPH
specialist. I also did an internet search and collected medical
journal articles…I sent a typed letter stating my position
of it being medically necessary and attached all of the doctors
letters, medial journal articles, medical records documenting
my daughters worsening condition…About two weeks later, a
physician reviewer for the insurance company approved my request." |
Prior authorization was not obtained
Insurance companies may require individuals to obtain a prior
authorization before receiving a medical service. If this is not
completed, you may receive an EOB that states that the service/claim
was denied because prior authorization was not obtained. Some
insurance companies will allow physicians to request a retro-active
authorization. This will allow the insurance company to authorize
treatment back to the time when your service was rendered. Please
be sure that you or your provider then request that the denied
claim be reprocessed referencing the authorization for correct
payment. If you have obtained prior authorization for a service,
and the claim is denied, provide copies of the authorization letters
to your insurance company to show that proper procedures were
followed.
Real Life-
"I had received 2 separate letters, both approving my Flolan therapy. I later started receiving EOB's (Explanation of Benefits) that said they (insurance) were denying all the charges for Flolan as it was considered an experimental drug. Showing them those letters was what saved me from having to pay for Flolan myself." |
Claim was filed incorrectly
Many insurance claim denials occur due to filing and/or processing
errors. Many times this is not be easily recognized because the
denial reason on your EOB will not indicate that there was any
filing or processing error, rather, it could be for any denial
reason. You and/or your health care provider will need to work
very closely with the insurance company to ensure that the services
they show you received match those for which you and/or your physician
billed. Also be sure to have them check the diagnosis code, as
this could also affect the services that are/are not covered.
Use the following sections of this guide as a reference tool
to gather all information and documentation necessary to dispute
your insurance company's non-coverage decision.
What is the process for submitting an appeal?
The process for appealing a denial will vary among health plans.
When calling your insurance company regarding the denial, the
first step should be to request a copy of the denial if you do
not already have one. You should also inform your insurance company
that you wish to appeal their denial and ask about the appeal
process. Here are some questions to ask your insurance company
representative:
- Why was the prior authorization or claim denied?
- Who must initiate the appeal (you or your provider)?
- What is the appeal process?
- How long will it take to process the appeal?
Who must submit the appeal?
In most cases, you or your physician (or physician's staff)
will be required to write an appeal letter. The purpose of an
appeal letter is to tell the insurance company that you do not
agree with their decision and the reason you believe the service
or claim should be covered. In this letter, be sure to include
the following information:
- Your insurance information such as your policy number and
group number so that your account is easily identifiable.
- A summary of the denial based on the denial letter you received
and your discussion with the insurance company.
- Your medical history related to your diagnosis (your physician
may be able to provide information from your medical chart).
- Any medical treatments previously tried for the conditions
and the results.
- An explanation of why your insurance company should reconsider
their denial and approve coverage.
A letter of medical necessity from your doctor may or may not
be required with your appeal. If this is required or recommended
by the insurance company, they may also request copies of your
medical records to accompany the letter of medical necessity.
In Appendix B of this guide, there is a sample claim denial
appeal letter. Even if not required, a letter from your physician
can be very helpful in supporting your position. No matter what
type of insurance you have, it is your right to appeal a denial.
Prior to submitting an appeal to your insurance company, be
sure to keep a copy for your own records. In addition, you may
want to call to confirm receipt of your information with your
insurance company and inquire as to how long it will take them
to review your information and make a decision. Based on the time
frame they provide, you will want to follow up periodically to
check on the status of your appeal.
If your appeal has been denied, you should request a copy of
the denial letter. This letter should include an explanation of
the reason for denial and may even request additional information.
The letter should also provide guidelines on further steps if
you would like to appeal this decision.
What is the grievance process and how can it help me?
Sometimes a claim denial is due to specific benefit exclusions
or restrictions included in a particular health plan. Specific
exclusions or restrictions are services or products that are not
covered by your health plan. If your claim is denied because the
service or products are specifically not covered by your health
plan, you may need to file a grievance. You also can file a grievance
as a formal complaint regarding any aspect of the services provided
by your healthcare plan.
As with the appeals processes, the process for filing a grievance
will vary from health plan to health plan. Be sure to call your
health plan's customer service department to obtain the specific
details. Calling for the specific details is important when submitting
a claim denial appeal or filing a grievance.
As a health plan member, you have the right to be heard, but
keep in mind that the insurance company may still deny your request.
The following section will give you some tips for communicating
with your insurance company to request coverage information, prior
authorization, appeals and grievances to help you get the most
out of your healthcare benefits.
This resource was developed in 2004. Some of the content may be out of date or no longer relevant. PHA is working to update and re-organize this guide. We apologize for any inconvenience.
