5 Reasons a Claim May Be Denied

5 Reasons a Claim May Be Denied

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Believe it or not, there are only a handful of things that may lead to a health care service not getting approved or a claim not being paid.

They fall into these five buckets.

The claim has errors. Minor data errors are the most common reason for claim denials. Sometimes, a provider may code the submission wrong, leave information out, misspell your name or have your birth date wrong. Your explanation of benefits (EOB) will give you clues, so check there first. If you find an error, ask your provider to correct the information and submit it again.

You used a provider who isn’t in your health plan’s network. Some plans only cover care if you use providers and facilities in your plan’s network. If you go out of network, your plan may not cover any of the costs. Other plans may only cover some of the out-of-network costs, and you will have to make up the difference.

Your provider should have gotten approval ahead of time. Some procedures, like a CT scan, MRI or certain surgeries, usually require pre-authorization. If you have a claim that isn’t covered because it wasn’t pre-authorized, talk to the doctor who ordered the procedure. There may be something they can do, like submit patient records that show you needed the service. If your doctor doesn’t help, call us. We can reach out to the provider on your behalf.

You get care that isn’t covered. It may be that your health plan doesn’t provide that benefit. For example, your health plan may not cover weight-loss surgery. In that case, it doesn’t undergo medical review. If your plan doesn’t cover it, the procedure won’t be approved. This is called a coverage limit or contract exclusion.

If you lost health plan coverage, your claim may not be covered. This may happen if you don’t pay your monthly premiums or run out of COBRA, for example.

Or the claim may have been denied for a medical reason. These types of denials may include:

  • The services were not considered medically necessary.
  • The setting for your care isn’t the right level of care.
  • The treatment hasn’t been proven effective or is considered experimental for your condition.

The claim went to the wrong insurance company. If you have a second health plan, like one from your employer and one from your spouse’s employer, the provider may have billed the wrong company. Or it can happen if the provider has outdated information because you changed insurers. When you get your EOB, check to see if it is from the right health plan, then contact your provider.

Sources: Tips for Appealing a Denied Health Insurance Claim,   Nerd Wallet, 2014; A Patient’s Guide to Navigating the Insurance Appeals Process,   Patient Advocate Foundation, 2013; The 5 Things You Should Know When Your Healthcare Claim Is "Denied",   Forbes, 2013; 5 Reasons Your Health Insurance Plan Will Deny Your Medical Claim,   Nerd Wallet, 2016
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