Health Insurance Denials Due to Cost
Health insurance companies want you to believe that in exchange for paying expensive premiums, you’ll be covered when you need medical care. In reality, however, these giant corporations are foremost driven by profit. Insurers have a litany of strategies for denying legitimate health insurance claims without stating the real reason for the denial. Unfortunately, the real reason is too often money. The more expensive a treatment or medication is, the greater the incentive to deny it. This article discusses some of the ways that medical insurers provide unreasonable health insurance denials for expensive treatments or medications. The article also suggests what you can do to fight back against these unfair practices.
There are many different reasons a medical insurer gives when it denies a treatment or medication due to high costs. Insurance companies, of course, do not want to reveal that the actual reason for the denial is its high cost. They spend millions on advertising campaigns asserting that they care about people. And that they put people first. And that they always strive to do the right thing for every member. Unfortunately, the system is set up to deny as many treatments and claims as possible to preserve the company’s bottom line. Below are some reasons an insurance company might give when it denies a claim and actions you can take.
The insurance company wants you to try a different option or options first.
For a treatment, this might be something like physical therapy or injections prior to getting a surgery. If you already tried the insurer’s recommended option, were the results beneficial? Your doctor can help assess whether you have already tried certain processes. More importantly, your doctor can tell you if the insurer’s suggested course of action is medically feasible for you. If your doctor disagrees with the insurer’s suggestion, s/he can write a letter to the insurance company. The letter can explain why your original request for treatment is medically necessary.
For a medication, the company might want you to do “prescription drug step therapy.” In this therapy, you start with less expensive or alternative medications. Once again, you can consult with your doctor to determine whether s/he already considered these medications. In addition, s/he can say whether this therapy would be an appropriate treatment for you. When your doctor agrees that step therapy should be implemented, you should attempt to comply with the insurer’s suggestion. If you do and still do not see improvement in your condition, you can then request the preferred medication again. If you have already attempted step therapy or your doctor disagrees that it would be appropriate for you, you can have your doctor write the insurer a letter specifying why the suggested options are not appropriate.
The medication or treatment is not considered the “standard of care” by the insurance company.
Insurers may claim a treatment or medication falls outside the standard of care as their basis for not providing coverage. The standard of care is what the insurance company believes to be the medical community’s general consensus regarding whether a particular treatment or medication would be exercised by a reasonably knowledgeable medical professional.
Determining whether something falls within the standard of care can be difficult. The standard of care is also subject to an insurance company’s own skewed expectations. The medical community is constantly discovering and developing new treatments and medications, or improvements to existing procedures. As such, updates to the standard of care can take long periods of time. This is because updates must go through review boards and then be officially implemented by insurance companies. Cutting edge developments such as life-saving drugs and treatments can therefore be denied as not meeting the standard of care. This is the case even though it could be exactly what a patient needs in a critical health crisis. If an insurance company denies a claim citing that it does not meet the standard of care, don’t be discouraged. A qualified health insurance attorney may be able to help make the insurance company approve the request.
The medication is not in the formulary.
A formulary is a list of prescription drugs covered by a health insurance plan offering prescription drug benefits. As with standard of care, one flaw of formularies is that they are frequently out-of-date. And unfortunately, newer drugs might mean the difference between life and death for a patient. Updating a formulary is a convoluted affair that involves considerable time and the consideration of many medical experts. Claim reviewers can only refer to the most recent published guidelines of the company formulary. These guidelines may not include brand new drugs or drugs that have recently been developed further. You can try to appeal this decision. If your appeal isn’t successful, you may want to contact an attorney. It is most beneficial to contact a lawyer who specializes in health insurance matters and who understands their systems.
The medical claim is cosmetic, not medically necessary.
Health insurance companies will also frequently deny claims because they are stated to be cosmetic rather than medically necessary. Cosmetic surgery is defined as being performed strictly to enhance appearance for superficial reasons. Although health insurers are not expected to cover cosmetic surgery, this surgery is often confused with medically necessary plastic surgery. Medically necessary plastic surgery is intended to aid dysfunctional body areas and has a focus on reconstruction. One example of a medically necessary plastic surgery is breast reconstruction following a mastectomy due to breast cancer. If a health insurer denies a procedure as cosmetic when it is actually medically necessary, you can appeal the decision. Your doctor should write a letter to the insurance company explaining why the specific procedure is medically necessary for you.
The denial is a mistake.
A reviewer may miss the fact that a similar request had been made and approved. Or miss the fact that similar treatments have been used to no beneficial effect. Since medical records are voluminous and difficult to parse, it is inevitable that details get overlooked or facts get misinterpreted. In these cases, the first step is to appeal the insurer’s decision. In the appeal, provide the documentation which proves a treatment is medically necessary. If your insurer denies an appeal on the same basis, then it may be time to consult with an attorney. Again, look for a lawyer who specializes in bad faith health insurance denials.
What do you do when you receive health insurance denials?
Health insurance claim denials can be devastating. Luckily, there are protections in place to ensure that a denied claim can be reviewed further before it is dismissed. What can you do in the case of a medical denial due to cost?
Appeal the health insurer’s denial.
You have a right to an internal appeal with your health insurer if it denies a claim. If the matter is particularly urgent, you should be able to request an expedited appeal. The process for initiating an appeal should be written on the denial letter you receive from the insurance company. If you have questions about submitting an appeal, you can always call the insurance company and ask what its procedure is. Below are some strategies that can help bolster your appeal and improve your chances of having a denial overturned.
Doctor writes a letter to the health insurance company
Have your doctor write a letter for your appeal explaining the denied procedure or medication is medically necessary. Of course, the doctor writing the letter will likely be the same person who initially recommended the procedure for you. Therefore, s/he should be able to accurately describe why the treatment is necessary. S/he can add your relevant medical records to bolster the chances of a successful appeal.
Doctor does a “Peer-to-Peer” review with the insurance company
Ask your doctor to do a Peer-to-Peer review with the insurance company. In a Peer-to-Peer, your doctor consults with other medical professionals associated with your insurance company. They discuss whether the requested procedure or medication is medically necessary. A Peer-to-Peer can eliminate the necessity of an appeal if they concur the requested item is, in fact, medically necessary.
Independent Medical Review (IMR) from the Department of Managed Healthcare (DMHC)
If your denial is based on “medical necessity” or it is regarded as “experimental” or “investigational,” you have another option. You can ask for an Independent Medical Review from the Department of Managed Healthcare. The DMHC sends your case to a third-party company for review. But given the serious implications if you take this route, you should discuss with a health insurance denial attorney before taking this approach.
Work with a lawyer who focuses on health insurance denials
Don’t feel discouraged if an initial appeal doesn’t reverse the health insurance denial. There are attorneys who specialize in this field of law. Many of these attorneys offer free consultations, so you can call and ask if you have a case worth pursuing. These attorneys are committed to fighting for consumers’ rights in the complicated health insurance industry.