How to Appeal a Health Insurance Claim Denial : A Step-by-Step Guide

1. Introduction– How to Appeal a Health Insurance Claim Denial?

   When a person suffers from a severe illness, the family members are in agony. Having health insurance covered during this period is helpful, as it will cover most of your treatment costs if not all. However, in some cases, people have experienced difficulties while claiming money from insurance companies. The process is usually time-consuming and frustrating. That is why you should know how to appeal for insurance and what you can do if your claim gets rejected by the insurance company.

   Over the years, several health insurance claims have been rejected due to several reasons. Denial rate is somewhere in between 2% to 49%. When a claim gets denied, the insurance company usually informs the person claiming the insurance money about the reason behind the cancellation. But it would be best if you did not lose hope, as you can appeal against the claim denial. After that, you can also apply again.^[1]

   In this article, we will familiarise you with the entire process of claiming health insurance and how you can get insurance money hassle-free.

2. Reasons for Claim Denials

   Ignoring the fine print and not reading between the lines can put us in troublesome situations. This laxity of ours is one of the biggest reasons the insurance claim gets rejected. Following are the scenarios in which insurance companies can deny your claim.

   Expected Reasons Why Health Insurance Claims Are Renounced:

   Claiming Beyond The Sum Insured

   Whether your health insurance covers your entire family or a particular individual, there is a thing called sum insured. Sum insured is a certain amount of money you or your family will get in case of any health-related issues in a year. If you have already used that sum insured, the company is not liable to pay you any additional amount. Under these circumstances, your claim will indeed get rejected.

   Certain Diseases Are Not Included As Per The Company Policies

   Your health insurance does not cover you for all the diseases known to humanity. There are always exceptions. If you or your family members suffer from any such illness, you will not get the money you claimed.

   Misinterpretation of Facts

   Insurance companies provide you coverage based on the information provided by the proposer. Suppose you have lied about your personal information while filling out the form. In that case, while filing claims, there is a high probability that your claim will get repudiated. Never lie about your age, occupation, income, or health status. Insurance companies can reject your claim based on non-disclosure or partial disclosure of necessary details.

   Going Beyond The Set Period

   According to the nature of your health insurance, you need to apply for the insurance money within a certain period. Exceeding the time limit will lead to the automatic renouncement of the claim.

3. Reviewing Your Health Insurance Policy

   Insurance policies get updated from time to time. So, you, as the policyholder, need to take the insurance papers from your drawer and review them to keep yourself updated about the rules and regulations. You should summarise all the details about the policy. Following is how you can check your policy.

   How To Review Your Policy And Identify Coverage Limitations

   There are some essential elements that all health insurance policies have. You must review the basics to learn about the procedure and identify coverage limitations.

   Type of Policy

   There are different types of health insurance policies that insurance companies offer. Know about the terms of your policy and the amount of money you will get from the insurance company in case of an unfortunate turn of events, along with other invaluable information.

   Policy Number

   Remember your policy number, as you need it for your health insurance.

   The Date On Which The Policy Was Issued

   Most of the policies cover a specific period. Link your bank account so that the policy renewal amount gets credited from your account automatically. So, keep the date in mind when your policy was insured for the first time. Keep the required amount in your bank before the due date of every renewal.

   List of Beneficiary

   Make the list of beneficiaries very carefully, as these will be the people who will benefit from the policy amount when you cannot.

   Required Premium Amount

   Always remember the amount of premium you need to pay every month.

   In case you have lost the original documents related to your health insurance policy. You can apply to the insurance company to obtain a duplicate copy of your documents.

4. Initial Steps After a Claim Denial

   When your claim gets rejected by the insurance company, the first thing you can do is contact your insurer to know the reason behind the denial. But there are some other things that you need to check for further processing. So, let’s see all those steps in detail.

   Request an Explanation Of Benefits (EOB) From Your Insurer

   EOB, which stands for Explanation of Benefits, is nothing but a statement issued by your health insurance company. When you acquire any medical service, the insurance company will give an EOB to inform you of the exact amount of benefit you will get from the insurance company. Earlier, jargon made it difficult for a commoner to understand the statement issued in an EOB, but at present EOBs come out in simple language. Your healthcare provider will ask the insurance company to settle the bill when you have insurance. In return, the insurer will inform the healthcare provider about the final amount the company is liable to pay. The company will give you your EOB within the set time, no matter what. The final result will be mentioned in the EOB that you will receive from your insurance company. Upon request, you will receive a copy of your EOB via mail or digital correspondence.^[2]

   Contact Your Insurer To Understand The Reason For The Denial

   If your plea gets denied, you can call the claim department to know the reason behind the denial. If you cannot find any contact number, write them an email requesting to put forth the exact reason behind the rejection of the insurance claim.

   Importance of Gathering All Necessary Documents and Records

   • Upon understanding the reason behind the rejection of your claim, you may require specific documents regarding your health insurance policy.
   • If your claim gets rejected due to incorrect documents, submit the desired documents as soon as possible.
   • While claiming the insurance, rectify the mistake if you have made any.
   • Last, suppose the insurer counterclaims that the hospitalisation was unnecessary. In that case, you can submit the medical professional’s letter and attach the medical reports.
   • When you are done doing all these things, file for the insurance claim once again.

5. Steps to File an Appeal

   Now that you are ready to appeal against your denied insurance claim let’s see what you must do. You can appeal against the decision taken by the health insurance provider in two ways.

   Internal Appeal

   After the insurance company denies your plea, you can write to the insurance company requesting them to review the judgement thoroughly. Here the 3rd party doesn’t only get involved in this process if you and the insurer. This process is known as an internal appeal.

   External Appeal

   You can take the help of a third party in this manner. Take all your documents and get an idea about the legitimacy of your appeal from this third party. Taking help from someone other than the insurance company is called an external review process. When you decide to appeal externally, the insurer loses the right to take the final call in your case. In 2021 close to 2500 external appeals were filed in this regard in the USA.^[3]

   Process of Internal Appeal Review

   Once you raise an internal appeal, the company can give you an answer within 72 hours.

   At the end of the internal appeal methodology, the company will conclude, and they will let you know their decision via mail or with the help of digital correspondence. If you are unsatisfied with that, you can seek an external review.

   Process of External Appeal

   After getting the result of your internal appeal, you can ask for an external request within the next four months. In some cases, this period may vary. Depending on your financial or health condition, you can directly seek an exterior appeal. You can call for an expedited review if your health condition is quite severe. Under this condition, the external review organisation is obliged to give you an answer within 72 hours.

6. What to Include in Your Appeal?

   As previously mentioned, you can always write to the insurer in case of a rejected or denied claim. While writing the appeal letter, you need to say the following things.

   • The reason for writing the letter
   • Your details
   • Details regarding the policy include the policy number, term, and premium amount.
   • What do you want the insurance provider to do regarding your rejected or denied claim?
   • To support your appeal, you can attach copies of your medical report and a letter from your medical service provider to make your claim more legitimate.

   You can make your appeal letter more persuasive in specific ways. Remember to mention why you invest in this policy and the health issues you suffer. All the necessary documents and supportive documents will give your insurer a second thought concerning your claim.

7. Working with Your Healthcare Provider

   It would be best to have your medical support provider on your side. At the same time, you appeal against the rejection of your insurance claim. The healthcare provider is an invaluable part of the process. The information that your doctor or the medical facility will provide will determine the fate of your appeal in some capacity.

   When making an internal appeal, attach all your previous medical records and a letter from your healthcare provider describing the severity of your medical condition. It can also define the condition of a family member admitted to the hospital. Suppose the claim denial is because the insurer thinks your health condition does not require medical help. In that case, this approval letter will turn the case in your favour.

8. Hiring an Advocate or Attorney

   You disagree with your insurer when all your attempts go in vain. Besides that, if you feel that the insurer is delaying the insurance claiming process, you can take the help of a lawyer. Only choose expert help in this matter. When you apply for an external review, you are moving to a court. You can’t take things into your own hands inside the courtroom. Having an advocate or attorney by your side ensures you can win the case against the insurance company.

9. Conclusion

   Over the last few years, health insurance claims getting denied or getting rejected have become a common issue. Don’t take too much stress if your claim gets declined for some reason.

   First, try to understand why your insurer has denied the claim, then take all the necessary measures. Suppose your claim is legal, and you have all the required documents regarding your insurance. In that case, you will surely get the insurance claim.

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