Why Your Health Insurance Claim Might Be Denied (and What You Can Do)

Today’s topic: Health Insurance Claim!

Millions of health insurance claims are denied every year. It is not uncommon for Americans to file a claim to receive benefits for their covered medical procedures, only to be met with rejection.

To understand why health insurance denial rates seem to be more common as the years pass, it is important to review why health insurance claims are denied in the first place.

You have options if your coverage is denied. It is not the end of the world to receive a rejection notice; all this means is that you need to file an appeal to try to reverse this decision.

How The Health Insurance Claim Process Works

The health insurance claim process works like this:

1. You receive medical treatment, and your healthcare provider submits a bill to your insurance company.
2. Your health insurance company will review the bill to see if your policy allows them to cover your charges.
3. An insurance adjuster or claim processor will follow up with the healthcare provider with requests for additional information, if necessary.
4. If the claim is approved, you will receive an explanation of benefits, and your treatment should be covered.

You are still responsible for any copay fees or deductibles. In certain cases, some services may not be fully covered, and so your insurance company will only cover a portion of the bill. The rest you will then need to settle from your own pocket.

This process may seem easy to follow, but unfortunately, things rarely ever go this smoothly. There are often delays in investigating whether treatment is medically necessary or if additional authorization is needed.

Further, insurance companies are more likely to deny your claim right from the beginning, which is why it’s helpful to have a health insurance claim denial attorney on your side.

Why Do Health Insurance Companies Deny Claims?

There are several possible reasons your health insurance claim was denied. Here are a few of the most common:

1. Lack Of Prior Authorization Or Policy Exclusions

Your insurance company likely reviewed your claim and determined:

• The services you received were excluded from your policy and thus would not be covered.
• The services you received required prior authorization. Because you did not receive this authorization, the services will not be covered.

It is important to note that policy exclusions can be ambiguous. In fact, many patients believe that their policy covers their treatment only to be shocked to learn that it does not, perhaps because the policy’s terms were unclear.

Courts usually stick to policy exclusions if they’re spelled out clearly. But if the wording’s confusing, you’ve got a real shot at fighting a denial.

When it comes to prior authorization, always check with your insurance first. That way, you know for sure if you need extra approval for a test or procedure.

And if it’s a true medical emergency, sometimes you don’t need prior authorization at all.

Additionally, with evidence and statements from your doctor, you may be able to show that proper protocol was followed despite the absence of authorization.

2. Treatment Deemed Not Medically Necessary

Insurance companies can deny claims if they deem the treatment you received as “not medically necessary.”

The truth is, deeming something as “medically necessary” is not a hard science and is prone to being victim to biased judgment and subjective interpretations.

Insurance adjusters are not doctors and are not capable of determining whether something is “necessary” for your health or not.

Thus, this reason for rejecting a claim is very controversial and often appealed with supporting evidence and detailed documentation.

3. Coding And Documentation Errors

Errors in coding and documentation represent another major source of claim denials. In fact, they are more likely to be because of a clerical or administrative mistake rather than problems with your insurance policy or coverage.

To enable communication between healthcare providers and insurance companies, insurers convert medical procedures and treatments into standardized medical codes.

There are times when they may provide an incorrect code or fail to include certain codes, making it challenging to understand which specific treatment you received.

Even a tiny mistake – like changing a number by one digit or a misspelling – can lead to a claim being denied.

If you think that your benefits denial was a result of these errors, you should promptly contact your healthcare provider’s billing department to fix the errors.

4. Pre-Existing Condition Limitations

Insurance companies are quite fond of using pre-existing conditions as an excuse for refusing health insurance claims. Of course, there are laws now that aim to prevent them from doing so.

However, the truth is they still manage to find a way around the rules, going through loopholes and exceptions to end up with people having no insurance when they are most in need.

In case your claim got refused because of a pre-existing condition, get in touch with a bad-faith insurance lawyer. They will help you determine if the law supports you and what you can do about it.

Also, don’t just ignore the denial. You can file an appeal, especially if what the insurance company did is against state or federal law.

5. Problems With Coordination Of Benefits

Sometimes claims are denied due to issues with the coordination of benefits.

If a patient has coverage through multiple health insurance policies, the insurance companies will have to coordinate accurately on who pays what and how much.

If there is any confusion or discrepancy, claims can be denied, especially if one of the insurers believes the other should primarily cover the costs.

How To Appeal A Health Insurance Claim Denial

While insurance companies will have different specific steps for their appeal process, generally, most will follow this framework:

1. Review your denial letter carefully.
2. Review your policy thoroughly.
3. Gather your evidence and organize it accordingly. 
4. Submit your appeal in writing either through the insurance company’s online portal or through certified mail.

You need to act quickly because the longer you wait, the harder it becomes to mount a successful appeal.

Even though the process seems easy, the insurance company will not make it so simple. For the best chances at fighting for coverage, it is best to reach out to a lawyer to assist you.

How An Attorney Can Help You

Retaining an attorney can help you in several ways. An attorney will:

• Help you gather all of the relevant evidence for your appeal.
• Represent your best interests at all times with the insurance company, and ensure you never settle for anything less than the coverage you deserve within your policy.
• Ensure you meet all deadlines and timelines for your appeal.
• If necessary, take your claim to court.

Additionally, a skilled attorney can make all the difference when fighting against the insurance company.

Most attorneys will operate on a contingency basis, meaning that if they are unable to help you win the case, you owe them nothing.

There is no risk in reaching out to an attorney to see if they can help you with your claim.

Do Not Let the Insurance Company Win

Insurance companies are notorious for prioritizing their own bottom line first above the patients who rely on their coverage.

Do not let the insurance company take advantage of your situation and get away with denying you coverage or only covering far less than what your policy dictates. You paid for insurance, and it is their obligation to cover you when you need it.

Insurance companies have adjusters and lawyers who have the skill to pressure patients into accepting the outcomes they offer.

While you can file your claim and fight your appeal on your own, it is best not to do this. At the very least, reach out to a health insurance claim denial attorney and see what your options are.

With an attorney, the law is on your side, and you can fight back against the insurance company so that they can give you the coverage you deserve.