Facing a health insurance claim denial can be overwhelming and frustrating, especially when you are dealing with critical medical needs. If you were denied health insurance coverage, you might wonder Can you sue if you were denied health insurance coverage?
You could also wonder about your options, including whether you can file a lawsuit against your health insurer. Understanding the steps involved, your legal rights, and how to handle claim denials can empower you to take effective action.
We know all of these questions are valid and important; therefore, we have answered everything in this detailed article:
Understanding Health Insurance Claim Denials
Health insurance companies deny healthcare claims for various reasons. Common reasons include disputes over coverage, paperwork errors, claims for services from an out-of-network provider, or arguments over whether the requested service is medically necessary.
Health insurers are businesses aiming to control costs, which can sometimes lead them to deny legitimate claims to minimize payouts.
It’s important to know that claim denial is not the final word. Many healthcare claims that are initially denied can be overturned through the appeals process, especially if the denial is based on missing or incorrect information.
Immediate Steps After Receiving a Health Insurance Denial
When you receive notice from your health insurance company denying your healthcare claim, you might get overwhelmed. However, knowing how to deal with a healthcare insurance company can be of great help. It can assist when you want to pay claims, medical bills, overall medical care, or for a prescription drug.
So, here’s what you should do:
1. Carefully Review the Denial
The insurance company must provide a detailed explanation for any claim denial. Review the denial letter closely, looking for specific reasons given for the denial, whether it relates to your health insurance policy limits, treatment coverage, or administrative issues like missing supporting documentation.
2. Collect Necessary Documentation
Gather all relevant documents, including medical records, bills, your insurance policy, and correspondence with your healthcare insurer. Detailed records can significantly strengthen your case during the appeals process.
This step is the most crucial as it prevents the insurance providers from reducing your settlements and insurance payments.
3. Contact Your Healthcare Provider
Talk to your healthcare provider about the denial. Providers often have experience dealing with health insurance companies and can provide additional documentation or clarify medical necessity, helping support your claim.
Usually, these simple steps can help you with the claims submitted and get a viable health plan, regardless of tough insurance policies.
Appealing Your Health Insurance Denial
Federal law provides clear guidelines to protect consumers facing unjust health insurance denials. The Affordable Care Act (ACA), along with state laws, ensures you have the right to appeal any denial of coverage.
Internal Appeal
Your first step is typically an internal appeal, which involves submitting a written request directly to your health insurance company.
During the internal review, you must explain why you believe the denial was incorrect and include additional supporting documentation, such as medical records, treatment plans, and letters from healthcare providers.
The insurance company must review your appeal objectively, considering all additional information provided. The internal appeal process often resolves many denials, especially those based on simple misunderstandings or errors.
External Appeal
If the internal appeal fails, you have the right to request an external review. An external review is conducted by independent third-party companies unaffiliated with your healthcare insurer. This step provides an unbiased decision regarding the validity of the insurance denial.
External reviews are crucial, especially when dealing with claims for expensive or life-saving treatments, as third-party reviewers are generally impartial and rely heavily on medical experts’ opinions.
Legal Action Against Health Insurance Companies
If both internal and external appeals fail, or if you believe the denial involved bad faith practices, you might consider taking legal action. Health insurance companies are obligated to act in good faith when processing claims, and failing to do so can constitute bad faith, allowing you to sue your health insurer.
Bad Faith Practices
Examples of bad faith practices include:
- Unjustified delays in processing claims
- Failing to provide clear reasons for denial
- Ignoring critical medical information supporting your claim
- Denying claims without a proper investigation
- Misrepresenting policy terms to deny a claim
If you suspect bad faith practices, consulting an attorney experienced in health insurance claims can help you determine if you have a valid case. We also recommend reviewing the top red flags that show your insurance company is into bad faith practices.
Filing a Lawsuit for Health Insurance Denial
To file a lawsuit against your health insurer, you must demonstrate clear evidence that the insurer unjustly denied your claim. Steps involved include:
Consultation with an Attorney
Schedule a free consultation with an attorney specializing in healthcare insurance disputes. They can review your claim denial, determine if you have a viable case, and guide you through legal proceedings.
Preparation and Filing of Lawsuit
Your attorney will prepare and file a legal complaint, outlining your original claim, reasons for denial, evidence of bad faith, and the financial impact caused by the denial, including medical bills, lost wages, and emotional distress.
Litigation Process
After filing your lawsuit, the litigation process includes the discovery phase, negotiation attempts, and potentially a court trial. Your lawyer will represent you throughout, presenting detailed explanations, medical evidence, and expert testimony to argue your case effectively.
Types of Compensation Available And Minimising Risks
If successful in your lawsuit, you could recover damages such as:
- Medical Expenses: Compensation for medical bills incurred due to the denied coverage.
- Lost Wages: Money to cover income lost because you couldn’t work due to untreated medical issues.
- Emotional Distress: Damages for anxiety, stress, and suffering caused by the denial.
- Punitive Damages: Additional financial penalties awarded in cases of severe bad faith practices.
To minimize the risk of insurance claim denials:
- Understand your healthcare plan thoroughly, including what services and procedures are covered.
- Always verify whether your healthcare provider is in-network or an out-of-network provider.
- Keep detailed records of all medical visits, treatments, and communications with insurers.
- Submit claims promptly and accurately to avoid administrative errors.
Medicare and Medicare Advantage Plans
Medicare Advantage plans are regulated under federal law, and specific procedures exist for appealing claim denials. If denied by a Medicare Advantage insurer, beneficiaries have rights to appeals similar to private insurance processes, involving internal and external reviews, and potentially federal court actions.
Common Reasons Claims Are Initially Denied & Legal Advice
More than half of health insurance claim denials result from administrative issues such as incorrect codes, incomplete paperwork, or lack of supporting medical documentation. Other common reasons include:
- The treatment is deemed experimental or not medically necessary.
- Services were provided by an out-of-network provider without proper authorization.
- The procedure requested is considered a less expensive option available.
Hiring an experienced attorney provides several benefits:
- Expertise in Healthcare Claims: Attorneys familiar with healthcare law understand the intricacies involved in claim denials.
- Negotiation Skills: Lawyers effectively communicate and negotiate with healthcare insurers.
- Litigation Experience: Experienced legal counsel significantly improves your chances of successful litigation if necessary.
Bottom Line
If your health insurance claim was unfairly denied, you don’t have to fight alone. At Bourassa Law Group, our attorneys specialize in helping clients challenge wrongful insurance denials, advocating fiercely for their right to healthcare coverage and fair treatment.
Take Action Now—Contact Bourassa Law Group
Contact us today for a free consultation to discuss your claim denial, understand your legal options, and ensure you are adequately represented. Let Bourassa Law Group help you recover the compensation and justice you deserve
1-800-870-8910