What to do if your health insurance claim is denied

Amy Higgins

You buy health insurance to avoid paying out of pocket for medical treatments, so it's frustrating when your insurance claim is denied. But if you feel a rejected claim was unwarranted, persistent efforts just might reverse your insurance company's decision.

Getting to know you

First off, it's important to get intimately acquainted with your health insurance policy. By doing so, you'll know what your insurance provider will and won't pay for, and you'll get a good understanding of what your provider considers a pre-existing condition. The National Association of Insurance Commissioners (NAIC) recommends asking your insurance agent or company for clarification about any parts of the policy you don't understand.

Talk it out

Have a list of questions on hand, and contact your health insurance provider as soon as you learn that your claim has been denied. The Insurance Information Institute suggests talking to the company's claims manager or, if you're insured with a smaller company, contacting the company president. Talking to the bigwigs might speed up the process. If you're asked for documentation, be sure to send copies, not originals.

Ask the company representative to explain exactly why your claim was denied and take detailed notes during your conversation. Whomever you speak to, be sure to get the representative's name and direct phone number.

A simple error like an incorrect code could cause a claim to be denied, NAIC points out. A company representative usually can resolve this kind of error quickly.

Appeal to action

If your initial attempt fails to do the trick, you need to appeal your claim. Insurance companies provide information about how to do so in your written rejection notice and on their websites.

Be sure to adhere to your insurance company's deadlines for appeals. CIGNA, for instance, explains on its website that all first-level appeals must be submitted within 180 calendar days of the date of the denial notice.

To get the appeal process rolling, you'll need to submit a letter to your insurance provider detailing why you think your claim should be accepted, according to NAIC. In your letter, provide evidence of what your procedure was and why it should be covered. Ask your doctor for copies of your medical records and proof of procedures you may have had, like X-rays or lab tests, and include copies of these records with your appeal letter.

Be sure to keep a copy of everything you send to the insurance company for your records, NAIC warns. Send these documents via certified mail through the postal service so you know when your package is mailed and received by the insurance company. The post office will obtain a signature when the documents are delivered.

If you are not satisfied with the resolution of the first-level review, CIGNA suggests trying a second-level appeal. With CIGNA, you have 60 calendar days after your first-level appeal review to submit a second-level appeal.

Don't give up

Just because your appeal was declined doesn't mean you should throw in the towel. You may have the option to resolve the issue through arbitration. CIGNA allows arbitration to be used as a binding, final resolution to a denied claim. The policyholder or the insurer can start the arbitration process by notifying the other party in writing, the company says.

NAIC suggests you contact your state's insurance regulator to learn about laws regarding health insurance claims. Being educated on which insurance laws are working for and against you will make communications with your insurance provider much smoother.

If all the above avenues fail, you might want to talk to an attorney. Meet with an attorney who has solid references, and bring copies of all documents that support your case when you meet for a consultation, the Insurance Information Institute suggests.

Consulting with your insurance provider about a denied claim might not be advantageous if you lose your cool. Although you may feel frustrated and slighted, the most important thing is to stay calm.