If you ever decide you have reason to appeal a decision made by your health insurance company, rest assured that there are plenty of others who have successfully gone before you. Health insurance companies are denying claims for a number of reasons. Despite what you may have heard from anti-insurance advocates, most of them are willing to consider your appeal with an open mind.
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State regulations across the country give consumers the legal right to file an appeal if they disagree with an insurance company decision. The state of Washington for example, clearly spells out the rights of consumers in a published guide designed to provide information about how to file an appeal. The document is free to download from the state’s insurance department website.
Why do insurance companies deny claims?
Much of the health insurance industry has become automated. That’s why you might see various codes on an invoice sent to you by your doctor or health care facility. When a health care claim is initially submitted it first goes through an automated process which compares those codes to prescribed coverage limits. As long as the codes are included in your policy, and the total amount billed does not exceed limits, your claim will be accepted by the automated system.
The possibility of denial comes into play when either the codes don’t match or the total bill is too high. In such a case your claim is then transferred to a human reviewer who will go through it and compare it to the actual language of your policy. If everything falls within established parameters your claim will be accepted. Anything outside of those parameters is a reason for denial.
How do I file an appeal?
According to the guide provided by the state of Washington, your best bet is to begin the appeal process by filing directly with your insurance company. This is because most state insurance departments don’t have the authority to force companies to pay claims. Since it’s nearly impossible to prove one of these two circumstances in a court of law the hands of state agencies are tied.
According to the Kaiser Family Foundation’s Kaiser Health News most denials are simply the result of errors in automated billing systems or the human review process. They claim the majority of disputes can be resolved by dealing directly with the insurance company itself. In cases when such an appeal is not effective there are other options.
You can file a complaint with your state insurance department which will enable them to at least follow up and find out what the problem is. Your state may be able to put you in touch with an independent arbitration agency as well. In either case, if you file an appeal and it’s denied you always have the option of civil litigation. You can also file your complaint with the Better Business Bureau, whose website is devoted to keeping track of consumer complaints about health insurance companies and other types of businesses.
How often do consumers win in civil court?
It is very difficult to win a civil court case against a health insurance company. Policy documents are written by lawyers in such a way as to protect insurance companies against breach of contract or bad faith liability. According to Kaiser health insurance, if you don’t win a direct appeal or get satisfaction through an independent arbiter you probably aren’t going to have much success in court. Should you decide to court you should hire an attorney who specializes in medical claims.
Some people have succeeded in suing health insurance companies, however. If you’re pursuing a breach of contract case it is the easier of the two to win. Your lawyer will have to find evidence that your health insurance company violated terms of the insurance contract by not providing you services for which you have paid. Winning a breach of contract case typically results in the payment of the benefits in question plus awards to cover the cost of your legal expenses.
Should you decide to pursue a bad faith case, your attorney will have to prove that your insurance company purposely misled you by causing you to believe they would pay for something they had no intention of covering. Bad faith is much more difficult to prove because you’re relying on a judge or jury to question the motives of your insurance company. If you do win a bad faith case you can probably have your legal expenses covered as part of the award.
Filing an appeal with your insurance company is always a good idea if you feel you’ve been wronged. Statistics show that the average success rate of appeals ranges between 49% and 59%, depending on the state where you live. If you’ve been denied a claim you have nothing to lose by appealing the denial.
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