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When Your Insurance Company Won’t Pay: 12 Tips

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Updated July 11, 2004

By Mary Shomon, with Dr. William Cline

1. Don’t assume that the first “no” you receive is final.
About 10 percent of all insurance claims are unjustly denied but less than 1 percent of people making insurance claims even question their insurer when their claim is denied. The majority of policyholders who do contest their cases either win their cases or improve their settlements.

2. Insist on a written explanation.
Most state laws require insurance companies to provide written explanations of claim denials. Failure to comply may constitute an illegal practice by the insurer.

3. Read your policy carefully to determine if the claim was legitimately denied.
The insurance company may have interpreted a clause in your policy differently from the way you understand it. Respect your sense of fairness and what you expect the policy to cover. If the ruling doesn’t sound fair, there’s a good chance that it isn’t.

4. Do not accept filing errors as ground for refusal.
Always follow your insurer’s instruction for filing a claim. But if you fail to fill out a form correctly, or if you miss a deadline for submitting a claim – even if you are months late – an insurance company cannot refuse to pay an otherwise valid claim unless the company can show it has been harmed by your error or prevented from making an adequate investigation due to your delay.

5. Do your own research to support your claim.
If your insurance pays less than you expected for care provided, check what other doctors in your area charge for the same care. If other doctors charge more than you received, challenge the payment.

6. Ask your insurance agent or group policy administrator at work for support.
The agent from whom you purchased your insurance has a duty to make sure the coverage protects your interests.

7. Contact the insurance company directly.
If your insurance agent or claims administrator doesn’t resolve the problem within 30 days, telephone the insurance company yourself. Be polite but persistent, and keep going up the corporate ladder. Be sure to make a record of all phone calls, including the names and positions of everyone with whom you speak. Save your phone bills that list the calls. Follow up each call with a brief letter stating your understanding of the conservations, and requesting a response within 30 days.

8. Complain in writing if your phone calls don’t work.
Begin with the person who denied your claim, then write to the person’s supervisor. Include your policy number, copies of all relevant forms, bills, and supporting documents and a clear, concise description of the problem. Request that the insurer responds in writing within three weeks. Keep copies of all correspondence. Send letters by registered mail. Explain what negative effects the denial of your claim is having. Use a courteous, unemotional tone and avoid rude or blaming statements.

9. Write a follow-up letter.
If you receive no response, send follow-up letters, with your original letter attached to the insurance company’s consumer complaints or customer service department and to the company president. In most states, failure to respond promptly to letters regarding claims is an unfair insurance practice.

10. Enlist outside help.
If necessary, add pressure from:
  • Your state Department of Insurance – this is free. The amount of these departments can help varies from state to state. But some states with strong departments (California, New York, Illinois) will mediate your dispute.
  • A professional arbitrator.
  • A lawyer.
11. Gain doctors’ support.
If you can enlist your doctors’ support for your claim, you have a better chance of successfully challenging a claim.

12. Look for violations.
If your claim is denied because of a reduction in coverage, determine if you were ever notified about that reduction in coverage. If you were not, then you have a good chance of winning your claim since failure to notify the patient of a reduction in coverage is a violation of the law.

Resources for Additional Information

Consumer Coalition for Quality Health Care
1275 K St. NW, Ste. 602
Washington, DC 20005
Phone: 202-789-3606
Web site: http://www.consumers.org

Center for Patient Advocacy
1350 Beverly Rd., Ste 108
McLean, VA 22101
Phone: 800-846-7444 or 703-748-0400
Web site: http://www.patientadvocacy.org

Consumers for Quality Care
1750 Ocean Park Ave., Ste. 200
Santa Monica, CA 90405
Phone: 310-392-0522
Web site: http://www.consumerwatchdog.org

Excellent Book to Read

Fight Back & Win – How to Get Your HMO and Health Insurance to Pay Up, by William M. Shernoff. Amazon.com, Barnes & Noble

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