Before an Appeal or Grievance is filed, the HMO must have made a decision regarding the outcome of a claim for a service already provided or predetermination to provide coverage for a service you are expecting to receive. Sometimes it is tricky to determine whether an HMO has actually denied coverage. For instance, as part of the claims process, the HMO has a right to investigate to see if you have other insurance coverage that may be liable for the claim; often, the HMO will pend (or hold) the claim for payment until such research is determined. By failure to respond to some of these requests, the HMO may be able to reject your claim. Thus, it is important to read your policy and coverage documents carefully.
How will I know that my HMO denied my claim?
Once a decision has been made by the HMO to deny payment or coverage, you will receive an Evidence of Benefits (EOB) statement (for claims payments) or letter (for predetermination of coverage) which will explain why the payment or coverage is being denied. Along with the EOB or denial for coverage, the HMO is required to provide you with your Appeal Rights. If you believe the claim was wrongfully denied, you should document your Appeal and send it to the HMO immediately (there are deadlines for filing an Appeal).
How do I increase my chances of getting my denial overturned?
(1) Include as many facts as possible along with back up documentation; (2) Explain why the claim/coverage is medically necessary (use the words "medically necessary"), and have your physician document in your medical records that the procedure is being done or was done because it was medically necessary; (3) Quote language directly from your policy and coverage documents that indicate that the payment and/or service is covered (you can even copy the appropriate page(s) from your policy booklets and attach them to your Appeal; (4) State that you will pursue further action including filing a complaint with the Department of Insurance (in most states, this is the name of the governmental entity that regulates HMOs).
What else should I do once I have prepared my Appeal?
(1) Make copies of your Appeal for yourself before mailing or faxing in the original; (2) Follow up with a phone call to ensure the HMO received your Appeal (and document the date and time you called, and who you spoke with that confirmed receipt); (3) Contact the physician or hospital for which the claim is for and let them know you have filed an Appeal so they prevent your claim from proceeding to collections.
What happens when the HMO receives my Appeal?
Once an Appeal is received, you should receive a letter from the HMO stating that the Appeal has been received and is being reviewed. The HMO is entitled to render a decision within a certain timeframe, which is governed by Federal and State Laws (depending on the type of insurance, i.e. Medicare policies are governed by Federal Regulations). In some circumstances you have the right to an Expedited Appeal but often you must proactively request one. Although verbal Appeals are allowed in many circumstances, you should always put your Appeal in writing (even if it is a follow up to a verbal Appeal). This way you will have documentation should you need it in the future. Once a decision has been made, you will receive another letter from the HMO indicating the decision along with rights to further Appeal in the event you are still denied payment / coverage. If the Appeal is denied, you can request a second level Appeal, and depending on the situation can request a third level Appeal.
Who reviews my Appeal(s)?
First level Appeals are generally done by HMO staff (usually nurses) under the direction of a Medical Director, also employed by the HMO. Second level Appeals are typically reviewed by a Medical Director or multiple Medical Directors employed by the HMO. Third level Appeals and some second level Appeals are typically reviewed by medical professionals at an external entity not owned by the HMO.
So, what happens if my claim is still denied?
Once you exhausted your Appeal Rights and are still denied payment or coverage, you can seek legal action. At this point, I would strongly recommend you consult a health care attorney in your local area if you haven't already. A good health care attorney will be able to present you with your options.
However, remember that not everything is covered under your policy. Keep in mind that HMO's provide insurance for payment of health services covered under your policy. Although your health is much more important than your car, your health insurance works very similar to your car insurance, or any other insurance for that matter. All insurance policies have limitations and exclusions. Health insurance is no different; thus, it is important for you to read and understand what your particular policy covers and what it does not.
Additional resources provided by the author
Should you have additional questions regarding health care denials, please feel free to contact Douglas R. Coenson, Esq. via email at