HEALTH INSURANCE COMPANIES AND HMO'S

DISPUTING ADVERSE DECISIONS:

FREQUENTLY ASKED QUESTIONS

Updated January 2010

IMPORTANT: Where your company is denying authorization for or the provision of emergency medical care, you can immediately contact the Maryland Insurance Administration at 1-800-492-6116 www.mdinsurance.state.md.us

HOW DO I DISPUTE AN ADVERSE DECISION BY MY INSURANCE COMPANY OR HMO?

Maryland law requires all health care plans and HMO's to have internal appeal procedures for patients to challenge adverse decisions. Adverse decisions include refusals to authorize future care or treatment; refusal to authorize emergency services at the time sought; and denial of coverage for care and treatment already rendered.

Companies must inform patients of adverse decisions in writing and must explain the right to appeal. Once an appeal is filed, companies have 30 days to respond where the case involves authorization for future services. Companies have 45 days to respond for cases involving denial of coverage for services already provided. If the company does not reverse its adverse decision at this stage, the patient may request an in-house hearing.

The State Health Insurance Commission does not require patients to use in-house grievance procedures where the case involves a denial of emergency care. Instead, the patient can contact the Commission immediately.

HOW COMPLICATED IS THE INTERNAL APPEAL PROCESS?

It is generally not difficult to pursue an appeal with your company. The process is ordinarily initiated by a letter asking for reconsideration. The letter may be as simple or as complex as called for by the circumstances. Some appeals involve only a short letter pointing out the company's error in refusing coverage. Other appeals may be quite complex -- for example, where a patient is seeking coverage of treatment the company has determined is "experimental" and therefore not within policy limits.

Maryland has a special Health and Education Advocacy Unit (known as HEAU and part of the Consumer Protection Division of the Office of the Attorney General, http://www.oag.state.md.us/Consumer/HEAU.htm). This Unit is available to assist patients prepare appeals to their insurance companies. HEAU can mediate cases but does not have enforcement authority. HEAU can assist patients in preparing documentation and analyzing the issues to present on appeal. Depending on your particular case, GLAO may recommend that you contact the Health Advocacy Unit or we may recommend alternatives.

IS IT WORTH PURSUING AN APPEAL OF AN ADVERSE DECISION?

Statistics compiled by the Maryland State Health Insurance Commission show that over 50% of adverse decisions are ultimately reversed upon appeal to the company. Our experience at GLAO has been similar. Since the appeal process is not particularly difficult to pursue, it may well be worth your while to dispute an adverse decision, especially where the financial stakes are significant.

WHAT IF MY INSURER OR HMO REFUSES TO CHANGE ITS DECISION ON APPEAL?

You can file a complaint with the State Insurance Commission after you have exhausted your company's internal appeals process. Your case is initiated by filing a complaint on-line or by mail. Often you can rely on materials you used in your appeal to your company, although in some cases additional work will be needed. For more information on the state complaint process, go to. www.mdinsurance.state.md.us/jsp/consumer/Appeals.jsp10

CAN I SUE MY HEALTH INSURANCE COMPANY OR HMO FOR DENYING COVERAGE, TREATMENT, OR SERVICES?

This may be an option where other efforts have failed. This can be a complex area of law. If you have questions about bringing suit against a health insurance company or HMO, GLAO is available for further information and discussion.

WHAT IF I AM REFUSED APPROVAL FOR MEDICAL CARE I NEED IMMEDIATELY? 

Call the State Insurance Commission at 1-800-492-6116. The Commission will decide whether it has jurisdiction in the case and whether it agrees that your problem presents an emergency. If the Commission finds that it has jurisdiction and that you are being denied emergency care, it can it can order your company to reverse its adverse decision. The Commission must act within 24 hours in cases it deems to involve denial of emergency care.

An emergency room should not refuse to treat, regardless of insurance, if you are seeking treatment for a life-threatening or other condition needing immediate attention. However, the hospital is entitled to bill you directly if your insurance company ultimately refuses to pay for the service

Remember: Each plan has different rules for emergency room treatment. Some plans require the patient to make reasonable efforts to obtain pre-authorization for emergency room care and/or require the patient to notify the company within 24-48 hours of receiving the care. Failure to follow these requirements may result in a denial of coverage later on.

WHAT CAN I DO IF ALL EFFORTS TO OBTAIN INSURANCE COVERAGE HAVE FAILED AND I AM NOW BEING BILLED FOR SERVICES BY A HEALTH PROVIDER?

Legally, a patient is personally responsible for the costs of hospital, doctor, and other provider services rendered. Hospitals and other providers typically require patients to sign a statement to that effect at the time services are rendered.

If your insurance plan ultimately refuses to pay the provider's bill, it is almost certain the hospital or medical office will pursue you personally for payment. In many if not most cases, hospitals and health providers are legally entitled to bill you and pursue the claim through credit collection agencies and court if you do not pay. There are exceptions, however, and we urge you to come see us if you believe you are being unfairly, erroneously, or illegally billed by the medical provider.

WHAT CAN I DO BEFORE I SEEK MEDICAL CARE TO MAKE SURE I WILL BE COVERED UNDER MY INSURANCE POLICY?

Read your policy carefully. Make sure you understand what is covered and what is not. If you have questions about coverage, call your company for an explanation. Decide what you want to do if your company claims it will not cover the services - e.g. defer treatment and dispute the denial? Receive treatment, accept financial responsibility, and dispute your company's denial afterwards?

Make sure you follow the requirements and provisions of your contract or plan to the letter. If referrals from your primary physician are required, get them before you seek the specialist's care. If prior approval is required for certain procedures, follow the directions for obtaining approval before going ahead.

IMPORTANT TIP: Many patients are admitted to hospitals that are participating members of the patient's health care plan. Patients reasonably assume the care and treatment they receive in the hospital will be covered by their policy or plan. Patients are shocked when they then receive bills from individual doctors and other health care providers (such as anesthesiologists) who rendered services but who do not personally participate in the patient's health care plan. This problem has been identified by the State Insurance Commission as a serious area of concern. The Commission notes that in many cases the patient is not even able to determine "up front" what costs will or will not be covered. Currently, there are no specific regulations or current legislation pending to remedy the problem.