Sometimes a claim is denied. This happens in public programs like Medicare and Medicaid, as well is in private plans. In fact, the federal government reports that Medicare denies 10 percent of all claims.
Claims are denied for a number of reasons. Some of the reasons might be:
You can send a request for an external review of your denied claim. You can also give someone else written permission to appeal for you, and in many states, your doctor may appeal on your behalf.
Individually Purchased Coverage
You can use your state’s external review program if you have purchased health insurance coverage for yourself or your family.
Health Insurance Through an Employer
You can use your state’s external review program if you have an “insured” employer-sponsored health plan. Your health plan is “insured” if your employer purchased coverage from an insurance company or health maintenance organization (HMO).
Self-Funded Coverage
State external review programs do not apply when an employer offers "self-funded" health insurance to employees. However, some employers have voluntarily implemented an external review program. Your health plan is “self-funded” if your employer pays for the health care costs of its employees directly rather than purchasing coverage from an insurance company or other organization. Contact your employer, your human resources department or state department of insurance for assistance in determining whether your employer sponsored plan is insured or self-funded.
Medicare or Medicaid Coverage
State external review programs do not apply if you are covered by Medicare or Medicaid. If you are a Medicare beneficiary, you must follow the Medicare review process described in your Medicare Handbook. If you are a Medicaid beneficiary, you can ask your state or local Medicaid office about their appeal procedures. See a list of state Medicaid offices for more information.
Medical Necessity
Most states allow you to appeal a denial of a claim when you have been told that the services are not “medically necessary.” Medical necessity generally means that the service or treatment is necessary and appropriate for the diagnosis or treatment of a covered illness or injury.
Experimental/Investigational
Most states also allow you to appeal a claim that was denied because the treatment or procedure is considered experimental or investigational.
Dollar Value of Claims
Usually there are no limits, but a few states require that your appeal involve a minimum amount of money (often between $100 and $500) to qualify for external review.
Most states require you to first follow your health plan's internal appeals process before requesting an external review, so check your state's requirements to determine if your claim is eligible. If your health plan continues to deny your claim after the internal appeals process, they will send you instructions on how to file a request for external review.
The time limit during which you must file your request for an external review is usually between 30 and 90 days.
This varies by state. Sometimes the request is directed to the Department of Insurance or another state agency, and sometimes it is directed to your health plan.
You will probably need information from a variety of sources. Examples of things you are likely to need include:
Your state may charge you a filing fee when you request an external review.
Usually around 30 days, though the timeframes for the completion of a non-urgent review vary by state.
In most states, there is a process for obtaining an expedited review of urgent conditions. Urgent reviews are often completed within 72 hours, though this timeframe also varies by state.
Your state’s insurance department can provide more information and instructions on how to file a request for external review. Often this information is posted on the department’s Web page. Additionally, your state may have an office of consumer advocacy that can provide you with additional information concerning your state’s specific external review laws and procedures.