Overview of Insurance Denials & Appeals

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Challenging a coverage denial by a health insurance plan is a legal right guaranteed to all insured individuals under the Affordable Care Act. Every health plan—including private policies, employer-sponsored health plans, Medicare, Medicare medication plans and Medicaid—must provide a process for reconsideration of any adverse determination of coverage by the plan. Both group and individual plans must implement an effective internal review and appeals process that meets federal standards.

1. If your health plan refuses to approve or pay a medical claim, you are entitled to receive a written denial letter that spells out the specific reason for its decision, and Information on your right to file an appeal, including key deadlines.
2. Read the denial letter carefully to determine health plan’s stated reason(s) for denying coverage for a product or service. Your health plan’s stated reasons may include:
   1. the product or service is not covered by your policy;
   2. the product or service is not medically necessary;
   3. the product or service is considered to be experimental or investigational;
   4. the provider or facility is out of network;
   5. you failed to secure prior authorization for the product or service.
3. Review your plan documents to determine whether the plan’s reasons for denial match up with the terms of your coverage.
4. First Level Appeals: Check your plan documents. Does your service meet the plan guidelines? What are the timelines for submitting an appeal? If your case is urgent, you can request expedited processing and you may be able to ask for an external review at the same time as your internal appeal.
5. Enlist support from your health care provider and craft your appeal letter. Gather supporting materials to show that the product or service is covered by your policy and is medically necessary. These may include:
   1. Letter of medical necessity; your treatment records;
   2. Journal articles, treatment guidelines, etc., supporting the use of the product or service at issue;
   3. Copies of prior authorizations, second opinions, etc.
6. Make sure to include your plan number, member number, and claim number in your letter. Send appeal letter and supportive documentation. Keep a copy for yourself and track your submission, verifying that the health plan has received your appeal.
7. Keep detailed, dated notes of any phone communications you have with your health plan regarding your claim and/or appeal. Promptly open all correspondence from your health plan.
8. If your appeal is denied, again check timelines for moving to next level of appeal.
9. Request a “peer to peer” evaluation of your case (a phone conversation between your doctor and medical staff employed by the health plan).
10. Second Level Appeals: If your first level appeal is unsuccessful, you and your provider can request review by a medical director at your health plan, and/or review by an independent external reviewer.

Formulary Exceptions

Many health plans cover some but not all available medications for a given health condition. A health plan’s list of covered medications is called a formulary. It is important for people with bleeding disorders to check that their treatments are covered before they enroll in or renew coverage during the health insurance open enrollment period each year. But sometimes, despite careful planning, people need to gain access to non-formulary medications. Maybe their health needs change, requiring a change in treatment – or perhaps the health plan has chosen to drop their drug from the formulary mid-year (a harmful but often legal practice known as “non-medical switching.”).

• If you need a medication that is not on your plan’s list, you can formally ask your insurer to cover the medication for you by submitting a “formulary exception.”
• You can also file an exceptions request if your health plan moves your medication to a different cost-sharing tier, increasing your out-of-pocket costs for that drug; says your prescription exceeds quantity or dosage limits; requires you to “fail first” on a drug that your doctor believes to be medically inappropriate for you.

Most plans require formulary exceptions to be filed by health care providers on behalf of their patients. Your doctor will need to send paperwork to your health plan establishing “medical necessity”: spelling out why you need access to a non- formulary product. Your doctor may be able to submit this paperwork via electronic filing.

Factors to Consider:

• Plans must generally respond to exceptions requests within defined periods: often, 72 hours for non-urgent requests, or 24 hours for urgent requests.
• If your formulary exception is denied by your health plan, you may have the right to appeal and ask for a reconsideration. Call your health plan regarding the denial and find out if you have appeal rights, and if so, what your
  timeline is for submission. Make and keep notes on all communications with your health plan.
• Newly approved medications are typically not added to plan formularies immediately after their FDA approval. If your doctor feels that a brand-new drug is the best treatment for you, a formulary exception may be necessary for you to access the medication.