Protect your right to appeal unfair insurance decisions and seek compensation for coverage denials. Don’t let corporate greed affect your health care.
Dealing with your health insurance company shouldn’t have to be an ordeal.
You expect your insurance company to step up and do the right thing, regardless of whether you or your employer pays the premiums.
Unfortunately, insurance companies are businesses fixed on the “bottom line.” For them, it’s all about profits, stock prices, and shareholder dividends.
Federal laws governing health care have changed dramatically in recent years. Patients have more rights to services and fewer restrictions on coverage than ever before. In response, insurance companies are finding other ways to limit or deny high-dollar claims.
Here’s what you need to know to fight wrongful claim denials and institutional medical malpractice.
Federal and State Healthcare Laws
Laws to improve healthcare for Americans began as far back as 1939 when the Federal Security Agency was created to administer institutions dealing with health, education, and social insurance. Since then, several more important laws have been enacted and later modified.
Medicare and Medicaid
President Johnson signed the Social Security Act in 1965. The Act included the provision of Medicare to provide hospitalization and other health benefits to Americans over 65 years of age.
The legislation also included a provision to provide insurance for low-income individuals by way of federal grants issued to states.
State-administered Medicaid now covers uninsured pregnant women, unemployed workers, disabled persons, and low-income people who are otherwise uninsured.
Employee Retirement Income Security Act of 1974
The Employee Retirement Income Security Act sets the minimum standards for private retirement and health care plans.
Among other things, ERISA requires the administrator of your health care plan to provide you with a summary of your plan, including information on what’s covered, coverage limitations, and how to file a claim.
Healthcare Quality Improvement Act of 1986
The Healthcare Quality Improvement Act was enacted to encourage physicians to file official complaints after encountering unprofessional and dangerous conduct by other doctors. The act also to protects medical professionals from lawsuits by doctors who have been reported for malpractice.
Children’s Health Insurance Program
The Children’s Health Insurance Program (CHIP) provides insurance to underprivileged children through state and federal funding. CHIP often covers children who are in working families who don’t qualify for Medicaid but can’t afford health care coverage.
Hospital Readmissions Reduction Program
The Hospital Readmissions Reduction Program is designed to improve patient care by reducing payouts to hospitals that experience excessive patient readmissions. Meaning, the hospital is penalized if patients are sent home and end up back in the hospital within 30 days, unless the patient has heart failure, pneumonia, or multiple health conditions.
Health Insurance Portability and Accountability Act of 1996
The Health Insurance Portability and Accountability Act (HIPAA) protects workers by allowing them to carry health insurance policies from job to job. The program also permits workers to change plans after life events like marriages, births and job loss, even when it’s not “open season” for health care changes.
Under HIPAA, insurance companies are forbidden to refuse to cover an applicant due to health problems. Sometimes, if an insurance company denies a worker’s application, the person is allowed to apply for coverage outside of the normal enrollment period.
Patient Safety and Quality Improvement Act of 2005
The Patient Safety and Quality Improvement Act protects health care workers who report unsafe conditions. PSQIA was created to encourage workers to report medical errors while protecting patients’ privacy.
Affordable Care Act of 2010
Rolled out in 2010, the Affordable Care Act, also known as “ObamaCare,” is intended to require every American to carry health coverage. While the provisions penalizing uninsured individuals have been removed, important parts of the act continue.
For example, insurance companies are no longer allowed to deny coverage or drop coverage for persons with pre-existing medical conditions.
The Act expanded Medicaid coverage for low-income individuals and provided subsidies based on income for qualifying persons enrolled in Marketplace plans.
Use this map to locate your State Department of Insurance to learn more about health insurance regulations in your location.
Coverage Denial and Filing an Appeal
Depending on the insurance company, anywhere from five to 20 percent of health insurance claims are initially denied. ¹
How can that happen?
Many times, the problem is a coding error or some other administrative hiccup. Sometimes, the patient is shocked to learn that their treatment or medication isn’t covered under their plan.
In a South Carolina case between battling insurers, the State Supreme Court decision included a commentary that could easily apply to all kinds of insurance companies:
“[I]nsurers generally are attempting to convince the customer when selling the policy that everything is covered and convince the court when a claim is made that nothing is covered.”
If your health care claim was denied, don’t give up. You have the right to appeal the denial, and there’s a good chance your claim will eventually get paid.
Identify the Reason for the Denial
The insurance company should have sent you written notification of your claim denial, with the reason your claim was denied. For example:
You are not eligible for benefits: You may not be eligible for benefits if you stopped paying your premiums before the date of service, or you were under a parent’s plan and no longer met the age requirement.
Your plan didn’t cover the service: Dig deeper if the service wasn’t covered. Sometimes it’s a coding error by the doctor’s office. For example, a chest x-ray may not be covered as a “screening” test but would be covered as a diagnostic test if you went to the doctor because of a cough.
You may need to ask the doctor’s billing department to put the claim through with a revised code. Don’t be afraid to ask for help. They want to get paid by the insurance company as quickly as possible.
The insurer needs more information: Most doctors are more than willing to send additional information to the insurance company to justify why your treatment or testing is medically necessary.
While waiting for their response, gather copies of your medical records, medical and therapy bills, and receipts for out-of-pocket expenses. Even receipts for the cost of transportation back and forth from treatment are important. Also, include copies of all correspondence between you and your insurance company.
It may take several weeks before you hear back from the company. They will either uphold their original denial, offer mediation of your claim, or overturn their denial and agree to provide coverage.
Watch Out for Deadlines
In most insurance cases, you have 180 days to file an appeal. Check your summary of benefits documents. Some companies have an even longer appeal period.
You should also be aware of the statute of limitations for your state. There might be different deadlines for breach of contract lawsuits and personal injury lawsuits. Your health insurance policy is a contract. Lawsuits over coverage issues are a contract dispute, even though your health may be at stake.
Filing an Internal Appeal
In most cases, you’ll have to start by following the insurance company appeal process. Your denial letter must include information of your right to appeal and how to submit the appeal.
By law, you are entitled to ask the insurance company to give you:
- Free copies of the relevant documents and records for your claim
- The name and title of the person who decided to deny your claim
- The identity of any medical expert whose advice was obtained by the insurer
Be sure to submit your appeal before the 180-day deadline. Include all information about your claim, especially any new information that could support the approval of your claim.
Your appeal must be reviewed by someone different than the person who initially denied your claim. Reviewing your appeal should take anywhere from 72 hours to 60 days, depending on the urgency of your medical situation.
When Your Appeal is Denied
By some estimates, up to half of all healthcare coverage appeals end up getting paid. Unfortunately, just as many do not.
If your appeal has been denied, the written notice should let you know if there are any further appeals available under your plan, and advise you of your right to file a complaint with your state’s department of insurance.
Your state’s insurance department will have a website or telephone number with information regarding the complaint process, including the forms you’ll need to file a formal complaint.
Once your complaint is filed, a state insurance investigator will be assigned to the case. The investigator will ask you for copies of all the documentation related to your claim, including correspondence with your insurance company regarding the denial.
After the investigator reviews your information and contacts the insurance company, you will be notified of the investigator’s findings. If evidence supporting your allegations of wrongful denial are found, the insurance company may be subject to substantial fines if they don’t pay your claim. The investigator may also ask your insurance company to agree to mediate your claim.
You don’t have to file a complaint before talking to an attorney about your case against the health insurance company.
HMOs and Medical Malpractice Claims
Managed care companies like Health Maintenance Organizations (HMOs) try to cut costs by paying less to the physicians on their payroll. HMOs also are known to offer financial incentives to doctors who save them money. Patients are harmed when their doctor cuts corners on medical tests and treatments to save the company money.
HMO providers can harm patients when they:
- Deny or unreasonably delay needed medical tests
- Deny or unreasonably delay needed medical treatment
- Deny or unreasonably delay referral to a medical specialist.
If you are a victim of malpractice by an HMO medical provider, talk to a personal injury attorney as soon as possible to protect your rights.
The HMO must continue providing coverage, even while you are suing them for malpractice. This scenario is legally complicated, but usually, the company must comply with the terms of their policy. They must continue to offer other doctors in the plan to provide your care, including treatment for complications caused by the incompetent doctor.
Why You Need an Attorney
Insurance companies are mega-corporations with an army of attorneys ready to fight claimants like you. They bank on the fact that most patients don’t have the energy or legal knowledge to fight claim denials.
You’ll need an experienced attorney to tackle a big insurance company of your behalf.
Breach of Contract
Your health insurance company is obligated to provide coverage under the policy they issued to you, which is a binding contract between you and the company. When you’ve paid your premiums, and they deny coverage, they have breached your contract.
Breach of contract means the party who broke the agreement is liable for the “damages” they cause.
Damages can be compensatory, consequential, and punitive. Compensatory damages include the actual costs of medical treatment you were entitled to under your insurance policy. Consequential damages include your collateral costs as a result of the breach, which can include medications, travel to and from treatment, parking fees, and more.
If your attorney proves the policy breach was an intentional conspiracy to defraud or deceive you, the court can award punitive damages, intended to “punish” the insurance company, which can run into hundreds of thousands of dollars.
Bad Faith Cases
Many states have strict bad faith regulations that your attorney can use against the insurance company. Bad faith tactics can include:
- Fraud, intentional deceit, or willful neglect of your claim
- Willful obstruction of your appeal
- The sudden cancellation of your policy as a retaliatory measure
- A pattern of intentional behavior to delay or deny coverage
Bad faith cases can cost the insurance company many thousands of dollars.
You can’t win a bad faith case without a skilled attorney. There’s too much at stake to try fighting the insurance company on your own.
Most attorneys don’t charge for the initial consultation and will represent insurance victims like you on a contingency fee basis. That means the attorney’s fees won’t get paid unless your case settles or you win a verdict at trial.
There’s no obligation. Don’t wait to find out what a good attorney can do for you.
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