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Summary

This document provides arguments to use with respect to each of the following reasons for denying a health claim. Whenever possible, look for information not previously given to the insurer. If there is no new information, at least try to include new evidence to help prove your case.

Do not be surprised if an insurer changes reasons for denying claims as it tries to avoid paying. Confront each reason as it is given. Be persistent. In this case, it pays often enough to be worth the effort.

When appealing a denial, be persistent, be persistent, be persistent. It pays off.

For sample appeal cover letters, see:

Please share arguments you use successfully either about these reasons or additional reasons for an insurer denying your claim. E mail: dlanday at survivorshipatoz dot org.

NOTE: For a sample cover letter to your doctor about helping with an appeal, click here. 

A Claim Denied On The Basis That The Procedure Or Treatment Is Not Medically Necessary

In general, health insurance does not pay for any treatment or procedure that is not "medically necessary."

Your goal is to prove that the treatment, service or procedure you want is appropriate, effective, and necessary for the stability, or restoration, of your health.

Build your case before submitting your appeal - while making sure to appeal within the time frame specified in your coverage. (If you can't build all your case before the deadline, submit what you have. You can add more as you learn it).

To build your case, find out:

  • If other specialists or health professionals in the area are using the procedure, service or treatment for medical situations like yours.
  • If the procedure, service or treatment is being used in other regions of the country for medical situations like yours. "Standard" medical procedures can vary by region.
  • If your national or local disease specific nonprofit organization has information on the use of this procedure, service or treatment with your diagnosis. If so, how often is it used and by whom? (The more respected the person or organization that uses the procedure, service or treatment, the better).
  • If the procedure, service or treatment has been covered in any peer reviewed medical journals. [A peer reviewed journal is one in which articles are reviewed by experts (peers) before publication. One of the best known peer reviewed journals is JAMA -- the Journal of the American Medical Association]. These journals can be obtained from your local library, a nearby medical school library or on the Internet. Do they support this use of the procedure, service or treatment in question?
  • Is this procedure being used for people with your diagnosis in other medically advanced countries such as Canada, countries in Europe or Israel? Many treatments, services and procedures have been used outside the U.S. before being approved by the FDA.
  • If members of your support group (if you have one) know about using this procedure, service or treatment. People with a particular medical condition are often better informed about treatments and results than doctors.

When you write your appeal letter, ask that your claim be reviewed by the insurer's medical director or staff doctor. Even though paid by the insurer, a doctor is more likely to back good patient care. 

Following is a list of sites that may provide the information you need.

For treatments, services or procedures

For drugs

A Claim Denied On The Basis That The Charges Are Not Usual, Customary and Reasonable ("UCR")

As you are likely aware, with indemnity health insurance plans, you can see any health care provider you want. After submitting the bill, you're reimbursed for a percentage of the charge. Rather than the actual charge, the charge on which the insurance companies base the percentage they pay is a standard they create and call "usual, customary and reasonable."

If an insurance company reduces your claim on the basis that the fee exceeds the amount that is Usual, Customary and Reasonable, you have the burden of proving that the charge is indeed reasonable. It is difficult to know whether you're the fees are actually high for the area where you live or receive treatment, or whether the insurance company is just being stingy and setting their UCR level artificially low.

To learn health care costs in your area:

Step 1. Speak with the insurance company. Ask the insurance company for details about how "Usual, Customary and Reasonable" was calculated in this instance. You may get an answer something like "it's up to our actuaries to make this kind of decision" (an actuary is a number cruncher who sets rates and makes other calculations for insurance companies.) If so, ask what information the actuary used.

Step 2. Contact your doctor, or his or her office manager.

Let the doctor or manager know you're not accusing them of overcharging, but that you are trying to correct a problem with the insurance company. Let the doctor or manager know what the insurance company has said about the charge.

Don't be surprised if the doctor blames the insurance company. Ask her to provide any information she can about the level of her charges and what she knows about what others in your community are charging for the same or similar procedures. Ask for the answer in writing so you can include it in your appeal.

Also consider asking the doctor if she will accept the insurance company's UCR amount as full payment. If so, you won't have to pay the remainder -- only your co-insurance or co-pay. While it is very difficult to get the insurance company to budge, doctors may be more lenient, especially if you and the doctor have a long and pleasant history.

Step 3. Do some more research.

If your doctor doesn't go along with the idea of reducing her bill, and if he or she is unable to provide sufficient information about charges in your area, you will have to do a lot of "leg work" to find out from other physicians in your area what they would charge for the disputed procedure or treatment.

If possible, contact as many doctors or doctors' offices in your area as you can. Ask:

  • What is the doctor's fee for this procedure?
  • How many of these procedures the doctor has done?
  • What is the doctor's training?
  • What is the doctor's experience with conditions like yours?
  • Has the doctor had training beyond the norm which would affect her ability to do the procedure, and perhaps charge more for it?

Confirm what the doctor or doctor's office told you by writing the doctor or her office restating what you were told. Ask the doctor or staff person to confirm the accuracy of what you were told. (This procedure takes more work on your part than just asking the doctor or her staff to write the letter -- but it makes it more likely you'll get the written confirmation you need. After all, you're asking a doctor with whom you don't have a relationship or pay to do you a favor.)

If the doctor or staff won't agree to put the information in writing, explain that you are asking for the information as a result of a denied claim, and that you will use it to bolster your case against the insurance company. This will help prepare the physician in case the insurance company calls to confirm your findings.

Be Persistent!

It is often difficult to get an insurance company to change UCR levels. Still, if you're persistent, the insurance company may be agreeable to making an exception for your particular claim -- if for no other reason, to get you off their backs.

A Claim Denied On The Basis That The Procedure Is Experimental

With new procedures, treatments or off-label uses of drugs (uses other than those for which the drug was approved by the FDA), an insurer may say the situation is "experimental" and therefore not covered. The insurer's primary argument is that until more is known, there is no reasonable way to tell whether the procedure, treatment or use will work, and in fact that it may be harmful. Of course, money may be a factor as well.

It becomes your burden to prove that a procedure is not experimental (even if it is performed in a research hospital). The goal becomes finding objective evidence which shows that the therapy is potentially effective for the group which includes you (the patient), that it is medically necessary, that it is a last resort that is reasonable and necessary for you, and/or that it has succeeded in prolonging life or improving quality of life. 

Insurers have been known to approve coverage for "experimental treatments" on a case-by-case basis. The decision should be made on a medical basis. According to the Health Insuirance Answer Book, 6th Edition, twelve major insurers polled by the Government Accounting Office said that nonmedical factors such as the fear of costly litigation and adverse public relations were also factors in the decision.

In order to build your case: 

Step 1. Check the wording in your insurance policy about "experimental." Definitions vary from company to company, and possibly from policy to policy within the same company.


Step 2. Speak with the doctor who recommended the procedure, treatment or off-label use. He or she is likely to be the best source of the information you will need. Your doctor can let you know if the procedure, treatment or use is indeed approved by the FDA for your diagnosis -- and can supply verification if that is the case.

Step 3. If the procedure is not FDA approved for your particular diagnosis, build your case that the procedure, treatment or use is not experimental before filing your appeal. If you can't complete your research before the deadline for filing an appeal, file the appeal and submit additional information as you learn it.  Find out:

    • If other specialists or health professionals in the area are using the procedure or treatment.  Many times procedures will be state of the art before they are FDA approved for your diagnosis.
    • If the procedure is being used in other regions of the country.  "Standard" medical procedures can vary by region. (Don't be surprised if it is difficult to find out how widely any given treatment is used.)
    • Whether your national or local disease specific non-profit organization has information on the use of this procedure, treatment or use with your diagnosis, including how often it is used and by whom.
    • If the procedure, treatment or use has been covered in any peer reviewed medical journals. [A peer reviewed journal is one in which articles are reviewed by experts (peers) before publication. One of the best known peer reviewed journals is JAMA -- the Journal of the American Medical Association]. Peer reviewed journals can be obtained from your local library, a nearby medical school library or on the internet. You can also find abstracts of many articles free on the library of the National Institutes of Heal's web site: www.pubmed.gov offsite link
    • If other insurers in your area cover the treatment in question.  Many large insurers list their policies concerning treatments on their Web sites. If the procedure, treatment or use is not listed,  your doctor may have knowledge of what other insurers do.
    • If this procedure, treatment or use is being used for people with your diagnosis in other medically advanced countries such as Canada, those in Europe, or Israel.  Many treatments, procedures and uses have been accepted in other medically advanced countries before being approved for use in the United States.
    • If members of your support group (if you have one) know about using this procedure, treatment or use.  Those with a particular medical condition are often better informed about treatments and results than doctors.

Step 4.When you write your appeal letter, ask that your claim be reviewed by the insurer's medical director or staff doctor. Even though paid by the insurer, a doctor is more likely to back good patient care. 

Following is a list of sites that may provide some of the information you need.

For treatments, services or procedures

  • PubMed (from the National Institutes of Health): www.ncbi.nim.nih.gov/sites/entrez offsite link. Abstracts (summaries of the articles) are free. The full articles may be expensive. If you need them, ask your doctor's office for help or check with a local medical school library for a free copy.
  • Annals of Internal Medicine (from the American College of Surgeons): www.annals.org offsite link
  • Journal Of The American Medical Association: http://jama.ama-assn.org/ offsite link
  • National Guideline Clearinghouse (US Department of Health and Human Services): www.guideline.gov offsite link (a public resource for evidence-based clinical practice guidelines. Check the date of guidelines before using to be sure they are current).
  • National Institutes of Health: http://www.nih.gov/ offsite link
  • The New England Journal of Medcine: http://content.nejm.org/ offsite link
  • Public Library of Science (PLoS) Journals: http://www.plos.org/journals/index.php offsite link

For drugs

If a drug is involved,  the manufacturer may be an excellent source for evidence that a drug or use of the drug is not experimental. Also see:

A Claim Denied On The Basis That The Procedure Is Not A Covered Procedure

An insurance company may deny a claim on the basis that the procedure is not covered under your particular policy. One way to do this is to call a procedure or treatment by a different name.

Of course, your first step is to call the insurance company and request an explanation for the denial.

If you still believe a procedure or treatment should be covered, call your state Insurance Department and ask how they would interpret the specific wording from the policy with respect to the treatment or procedure that is being denied. The Insurance Department's opinion won't necessarily be binding. However, if the Insurance Department agrees with you, it becomes a strong argument with which to return to the insurance company.

Try to get this opinion in writing. Even if the Insurance Department employee won't put the opinion in writing, be sure to get the name of the person with whom you speak.

The Insurance Department may insist you file a complaint before it will give you this kind of advice. If so, there are no apparent reasons to keep you from filing a complaint . Still, before filing, think through your situation to see if there any that apply to you.

A Claim Denied Due To Misrepresentation In The Application

An insurer may allege misrepresentation of medical facts in the insurance application. This usually occurs when an insurer alleges that the insured failed to disclose a preexisting health condition in the application.

The common reason that brings this reason for claim denial to the fore is when an insurer compares your answers on the application to the information in your medical records. This frequently occurs if a claim is made relatively soon after the policy issue date.

If a condition existed before the issue date of the policy, the question becomes the definition of a misrepresentation contained in the policy. Often the definition refers to a condition the applicant knew about, or had treated within 6 - 12 months prior to the issue date, or is a condition that a prudent person would have had treated in that period of time.

Generally, insurance consumers are not expected to be medical experts. They are simply expected to report their medical condition as they honestly and reasonably believe it to be. For example, a cough before the application date which was not sufficiently bad to drive a person to seek treatment is not necessarily a misrepresentation when the insured is diagnosed with lung cancer soon after the issuance of the policy. 

Likewise, if a doctor notes a disease, condition or sympton in the patient's record, but the patient does not know about it, there is no misrepresentation.

Counteract an argument of misrepresentation by showing that you did not know of the condition that surfaced after issuance of the policy. Your doctor, friends and co-workers with whom you have daily contact may be good sources to help prove what you did, or did not, know.

A Claim Denied On The Basis That The Specialist Or Facility Is Out Of Network

If a health insurance policy does not cover medical care provided outside the company's network, what to do in an appeal depends on whether you received the care on an emergency basis or whether you received the care without your active choice. Steps to take about each are described below.

If you actively chose to receive medical care by a doctor or facility outside the network and are now seeking payment, you will have to prove both that the care was "medically necessary" and that you were prudent in seeking such care instead of staying in network. Information about appealing denial of a claim because of "medical necessity" is described above.

Emergency Care

  • First check to see what your policy says about emergency care. It is not likely that emergency care will not be covered if you are traveling or if it would be medically unwise for you to take the time to go to an in network doctor or facility.
  • If there is such an exclusion, check your state law to see if the exclusion is legal.
    • To learn the law of your state, go to The Actors' Fund Of America's Health Insurance Resource Center (www.ahirc.org offsite link, click on your state, then click on "Insurance Guides" and/or Complaints/Appeals).
    • If you have difficulty, contact your Department of Insurance for guidance. For contact information for your state insurance department, see: www.naic.org offsite link. Click on "NAIC States and Jurisdictions."
  • If an exclusion is legal, ask your doctor to help you write a letter explaining why it was imperative that you receive care from the doctor and/or facility rather than than one which is in network,. Include what would have happened to you if you didn't seek the emergency care  you did.

Care Received Without Your Knowledge

It happens that you may receive a medical service, particularly from a specialist, without knowledge or when you are in no position to ask.. For instance, you engage a surgeon who is in network, but don't think to ask whether the anesthesiologist that will be used in the operation is also in network. Or you were unconscious.  This is generally referred to as "Balance Billing."

In this situation, insurer's pay part of the fee, or none of the fee at all. The patient is billed for the difference.

If this happens to you, take the following steps:

  • Step 1. Check to see if you are being billed by a health care provider who is in your network for a service that is covered by your insurance plan. If so, the insurer should pay the bill.
  • Step 2. If the bill is from a doctor not in the network, contact the insurance company. Explain that this was an involuntary use of an out-of-network provider, and that you made a good faith effort to only use in-network doctors. Ask the insurance company to pay the bill.
  • Step 3. If the insurance company will not pay the bill, check the law in your state. It may prohibit balance billing.
    • To learn the law of your state, go to The Actors' Fund Of America's Health Insurance Resource Center (www.ahirc.org offsite link, click on your state, then click on "Insurance Guides" and/or Complaints/Appeals).
    • If you have difficulty, contact your Department of Insurance for guidance. There may be a regulation which prevents balance billing in your situation. For example, in California, there is a regulation which makes it illegal for people covered by an HMO (Health Maintenance Organization) to be balance billed for out-of-network emergency servivces. If there is such a law/regulation in your state, call the insurance company and the doctor and remind them of it. For your state's insurance department contact information see: www.naic.org offsite link. Click on "NAIC States and Jurisdictions."
  • Step 4. If there is no such law or regulation in your state, don't pay the bill and expect to get it back from the insurance company. Instead, ask the company to work through the situation on your behalf to eliminate or reduce the bill. If the insurer won't try to negotiate the bill, contact the doctor or his or her staff and try to negotiate the bill, or hire a professional to do the negotiation for you.
  • Step 5. If there continues to be an outstanding bill, file an appeal with your insurance company to get the company to pay all, or at least a large part, of the bill. The explanation should include the steps you took to follow the insurer's rules. 
    • If the doctor was engaged by another doctor, Include a statement that you assumed the in network doctor knew the rules and that he or she would only use other doctors who were also in network. If the use of the lead doctor was pre-approved by the insurer, include that fact as well.
    • If the use of the doctor was involuntary, include the facts about what was going on. Include proof of what was happening at the time. For instance, if you were in an ambulance, a copy of the report from the ambulance company. 

A Claim Denied On The Basis That The Treatment Or Drug Is Not Likely To Cause Your Health Condition To Improve

If the treatment or drug relates to your diagnosis, see the section above about Medically Necessary.

If the treatment or drug relates to another aspect of your health care, ask your doctor to write a letter explaining why the medical care is necessary for your total health care needs. The key should be your total health condition and health-care needs - not just a chance for full or partial recovery.

A Claim Denied On The Basis That You Are Likely To Require Care For A Very Long Time

Health insurance is generally not limited to treatments or drug regimens that work quickly. The key is whether it is medically necessary. To learn more, see the above section about claim denials because a drug or treatment is not Medically Necessary.

A Claim Denied For Technical Reasons Such As Incorrect Coding

It is not unusual for a claim to be denied for technical reasons - for instance, because the code used by the medical provider is incorrect.

Ask the health care provider that submitted the claim to correct and resubmit the claim.

A Claim Denied Because You Are Not Home Bound

If your insurance covers home care, it may require that you be home bound.

Homebound does not generally mean that you are completelyunable to learve your home - or that you are confined to bed. For example, you are permitted to leave home for medical care. It is generally required that you must make a considerable effort to leave the house. There may even be a requirement that you need assistance to leave the house.

Check the precise wording of your health insurance. Ask a care provider (family member, friend, or hired nurse or aide) to write a letter describing how difficult it is for you to get around, and what is required to assist you in leaving the house. If you leave the house infrequently, it would help to describe the purpose of your trips, and how difficult they are for you.

Include the letter with your appeal form.