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How to Appeal a Denied Medical Claim under Obamacare

Perhaps you’ve experienced it before: your doctor ordered some tests or a special procedure for you, and you assumed it would be covered by your insurance, but the health insurance company denied your medical claim.

Denied medical claims can result in a big financial burden for you, the policy holder – but under Obamacare, you have the right to appeal your health insurance company’s denial of payment for a claim.

Most medical claims are denied appropriately, based on the coverage provided under your plan, but there are gray areas. That’s why you need to know how to appeal a medical claim under your Obamacare health insurance plan to ensure your claim wasn’t denied incorrectly.

Knowing what’s covered under your Obamacare plan, and what’s not

When it comes to researching and applying for health insurance, you are probably like most people. No one wants to read the small print, but it really helps to do so if you want to know what’s covered – and what’s not.

All Obamacare plans provide some level of coverage for the 10 essential health benefits defined by the law. Beyond those ten categories, however, there’s still a decent amount of variation among plans. No health plan covers all medical procedures, even if it’s a procedure recommended by your doctor. Pre-authorization may be required for some procedures. This pre-authorization involves asking for coverage before the procedure, usually with a letter from your doctor and any medical records that help make your case.

Other procedures are simply “excluded” from coverage and will not be covered by your plan. Make sure to read the “exclusions” section of your plan description to ensure any procedures listed are not ones you may need to have in the near future or have had in the past.

Why your medical claim was denied

When you receive medical care and the doctor’s office files the claim with your insurance company, you will usually receive a statement of benefits from your insurance company. This is where you are most likely to learn that coverage for a specific procedure was denied.

Some information about why it was denied may be provided on the statement of benefits, but you should call your insurance company for a more detailed explanation.

Your doctor’s office may not be able to explain to you specifically why a medical claim was denied. The insurance company’s representative will be able to look at your claim and explain in detail why your specific treatment was declined based upon your plan and coverage.

There can be many reasons why this occurs but here are a few possible reasons:

  • The procedure may be considered not medically necessary or cosmetic in nature
  • The procedure may require pre-authorization beforehand and no pre-authorization was obtained
  • The procedure may be considered experimental in nature and not broadly medically accepted for your condition
  • The procedure may be explicitly excluded from coverage under your plan
  • OR the insurance company may have made a mistake

Knowing the exact reasons why your procedure was not covered will help you in following up with the insurance company if you want to appeal their decision to deny your medical claim.

If you worked with an agent, ask your agent for help

If you find that your health insurance company isn’t giving you the information you need about your denial of coverage, ask your licensed health insurance agent for assistance (if you used one to obtain your coverage).

Not everyone purchases coverage through an agent, but this is where it can be helpful to do so. Your agent can contact the insurance company on your behalf and help you understand why the claim was denied and whether the procedure met the requirements for coverage under your plan.

Your agent will have an established relationship with the insurance company and a special interest in helping you as one of their customers. They may also have experience with a similar situation from a different customer. This experience can be helpful in getting information you need to try and get your denial reversed.

What is an appeal?

If your insurance company denies payment for your claim, you can request an appeal. Ask your insurance company to take a second look at the claim and see if an error was made on their part in deciding to deny the claim. When your insurance company receives your request, it is required to review and explain its decision.  Your insurance company is required to start and complete the process in a timely manner.

If your insurance company still denies payment or coverage for your procedure, you may ask for a secondary appeal. If there are additional details that might help make your case, provide them now. The law may also permit you to request to have an independent third party review your medical claim. This review by an independent third party is often referred to as an “external review.”

How to appeal a denial with your insurance company

You always have the right to file an appeal on a denied medical claim. If your doctor agrees with you that the claim ought to have been considered “medically necessary” in your case, he or she may help you with your appeal.

Write a letter to your insurance company making it clear that you want the medical claim reconsidered. Some insurers may even have an online appeals process to make things easier for you. As a first step, get a letter from your doctor to support your case, along with any medical records or lab results that also bolster your case.

Submit all these together in a package to your insurance company’s appeals department to show a complete reason you are appealing their decision.

What to expect when you’ve filed your appeal

Once your appeal has been received you should receive confirmation from your insurance company. The appeals department at an insurance company is generally staffed with nurses and doctors and representatives familiar with the benefits covered by your plan.

Your claim will be reviewed and a coverage determination made based on the benefits offered by your plan and the medical details provided. The decision will generally be provided to you in writing. If the claim is denied and you have additional information to provide that may help make your case, you can appeal the claim a second time.

A second appeal may go to a third party to review, known as your “external review.” However, appeal rights depend on the state you live in and the type of health plan you have. Some plans may require more than one level of internal appeal before you can request an external review.

In closing

No one ever likes to receive bad news, especially when related to their health insurance coverage. If you should happen to receive a denial in coverage, knowing your options under Obamacare can be helpful.

Utilize all the resources you have at your disposal – your doctor, your agent or others – and get a full explanation from your insurance company as to why your medical claim was denied. Hopefully you never will need to appeal a denied claim but if you should knowing what to expect can help you navigate the road ahead.