What to Do if Your Health Insurance Claim Is Denied

I came to the USA over a decade ago and one of the most difficult things for me to understand in this country was how the health insurance system works. I am still learning, but I have had some success in recent situations when my claims have been rejected. But, when talking to friends, I realized that even people who were born and raised in the USA do not know how to get their health insurance to work for them. I also found that there are very few places on the internet where you can get advice or tips about what to do when your claim has been rejected and what insurance laws there are that protect consumers. It is very complicated.

The goal of this post is to share my experience dealing with medical insurance and claims when they have been rejected. Hopefully it will be helpful for somebody who is in a similar situation.

1. My newborn needed pediatric physical therapy. I was searching our insurance network but could not find any pediatric physical therapists who treat newborns. I called the insurance company and they suggested somebody in their network 40 min away from where we live. To make matters worse, when I called the provider that our insurance company suggested, the doctor did not have a practice there anymore and moved to another state. When we explained this to the insurance company, they proceeded to refer our baby to a sports-therapist. We filed an appeal with the insurance company requesting they cover an out-of-network doctor since they did not have an appropriate in-network one. At one point they even tried to convince a provider who had not treated a child in years to take us since they didn’t have anyone else. The provider initially accepted, because she was worried our child was not getting the care he needed. But, then reconsidered when she learned that this was just a ploy by the insurance company to pretend they had an in-network provider (so as to reject an out-of-network bill).

This seemed very unfair to me. So, I researched the laws governing this behavior. Even without any legal-training I was able to find the relevant policies and use them to convince the California Insurance Controller’s office to overrule our insurance company’s decision. Here is what I found.

– According to the Families USA organization which represents health care consumers, insurance companies must to keep their directory updated and remove providers from the directory when they are no longer available. So, they were no longer able to point to their out-of-date records of a provider who had moved out of state as evidence that they had at least one in-network provider. You can read more about these insurance rules here.

– Also, according to the Families USA organization insurance must have sufficient number of providers in their network to meet enrollees. Our health insurance did not have any pediatric physical therapists in their network that we could easily reach. You can read about this law here.

– The National Conference of State Legislators (ncsl.org) also notes that insurance companies must have in-network providers geographically near their subscribers. The specific laws are different for each state but idea is the same; it should not take you hours to drive to visit a specialist. For example, if you live in New Jersey, your providers should be “available within 45 miles or 60 minutes average driving time, whichever is less”. In Illinois, “the family would not have to travel more than an additional 15 miles or an additional 30 minutes to the network provider than it would have to travel to a non-network provider who is available to provide the same service.” You can see regulations for more states here.

Sending the above regulations directly to the insurance company did not have much of a positive effect. They just kept rejecting our claim. The negotiation process took months, since with each message the insurance company would send an automated response right away then take a week or two to send a real response. However, we kept track of all correspondence. So, after sufficient time had passed and we had collected enough documentation that the company was not following regulations (it took about 3 months), we have put together everything and sent it to the California Insurance Controller. This step was like magic. Insurance controller contacted our medical insurance company. Within a week, our insurance company pre-approved us for an experienced provider who is not normally in-network. They also paid for the out of network specialist we had been going to at the in-network rate.

It is very important to keep all correspondence with the insurance company. If they communicate through their website, be sure to print or otherwise save a copy of what they send you since they can remove “old” correspondence. It is better to communicate with them in written form. However, if you have to call them regarding a claim, make sure to write down the reference number of a person you speak with. Also, always ask the customer service to read what they wrote down after you explained them your complain or request. Sometimes you will think that they understood, but actually they documented the call in a different way than you would like.

2. I also have another story when insurance rejected the claim that might be helpful to somebody.

I had to get an epidural during a very long labor (more than 24 hours). After a couple of months we got a bill for $6000 from anesthesiologist which was not covered by our insurance. Somebody from anesthesiologist office wrote to us on the bill that we have to call to our insurance and explain that my epidural took place in and in-network hospital even though it was performed by out of network provider. We did this as was advised and the the insurance company paid the claim without complaint. This is likely because under a 2015 California law, consumers who go to an in-network facility but are treated by an out-of-network provider there only have to pay what they would have been charged if the provider participated in their plan. You can read more on this here: http://www.wsj.com/articles/surprise-bills-for-many-under-health-law-1434042543. “Surprise Bills” laws were also introduced in New York and Texas.

Please, share your stories and experience dealing with medical claims and insurances in the comments.