A health insurance denial can be terrifying. You could suddenly be on the hook for thousands or tens of thousands of dollars in medical care. Don’t panic: you have the right to appeal a denial. The health insurance appeal letter is the starting point.
Let’s take a closer look at why claims get denied and what you can do about it, including two health insurance appeal letter templates.
What Is a Health Insurance Appeal Letter?
When your health insurance company receives a claim from your doctor or a healthcare facility, it will review that claim. The insurer may approve the claim and make a payment. They may also deny the claim.
If the insurer refuses to authorize payment for treatment, you’ll usually get a denial notice or explanation of benefits explaining that the claim was denied and that you’re required to pay the medical bill yourself.
This decision from your insurer isn’t final. You can use a health insurance appeal letter to ask the insurer to reconsider. Depending on the reasons for the denial and your appeal, the insurer may change its decision and cover your bill.
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Why Claims Are Denied
Claims can be denied for many different reasons. One of the first things to do before submitting an appeal to your insurer is to make sure you understand why your claim was denied. It’s important to understand why your claim was denied before preparing your health insurance appeal letter.
Common reasons for denial include:
Timely Filing
One of the simplest reasons your insurer might deny a claim is that your healthcare provider was slow about filing the paperwork. For most insurers, the deadline varies from 90 days to a year from the date service was provided, but some have shorter deadlines.
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Non-Covered Services
Not every insurance plan covers every type of medical care or every medical service. Under the Affordable Care Act, certain essential health benefits must be included in your plan, but some things can be excluded.
Some plans also sidestep ACA rules, so you might find unexpected exclusions. For example, your plan may not cover prescriptions or mental health care.
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Lack of Pre-Authorization
Some insurance plans require that you work with a primary care provider before seeking help from a specialist. There are also plans that make you get certain services pre-authorized.
If you want to take a non-emergency blood test to check for a specific illness, you may have to run that by your insurer to get permission before ordering the test. If you fail to follow these rules and don’t get pre-authorized for certain services, your insurer could deny the claim.
Bundled Services
Healthcare, especially when you have an issue serious enough to lead to an ER visit or hospital stay, can be incredibly complicated. Many services and tests are closely intertwined, so insurers may see them as effectively bundled together.
If you go to the emergency room, the doctors there will likely run a series of tests to assess your condition. If they submit a bill to your insurer that includes a line item for your evaluation and then separate line items for multiple basic diagnostics, the insurer might deny the claims for those diagnostics because it feels that they should be included in the standard evaluation.
Data Discrepancies or Paperwork Errors
Simple paperwork problems or data discrepancies can also be a source of denials. If your doctor submits a claim to your insurance company and lists your name as “Jim Smith” when your name is really “James Smith,” that could lead to a denial.
Entering the wrong codes for treatments or entering incorrect treatments or tests by accident could also lead to denials.
Network Issues
Depending on your insurance plan, you may have to visit specific in-network health providers. Out-of-network providers won’t be covered. If you get care at an out-of-network facility, expect to see your claim denied.
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Levels of Appeal
If your insurer denies your claim, you shouldn’t panic yet. It can be scary to suddenly owe a large amount of money, but you still have the chance to appeal the decision.
Insurers are required by law to offer two levels of appeal: internal and external. You will have to initiate both appeal processes with a health insurance appeal letter.
Internal Appeal
The first level of appeal is an internal appeal. This is a request to your insurance company to look at your claim again and conduct a “full and fair review” of the decision. In urgent situations, the insurance company must expedite the review for you.
When filing the appeal, you must write a health insurance appeal letter. It must include your name, claim number, and insurance ID number. You can also provide supporting evidence, such as a letter from your doctor explaining why you believe the treatment should be covered.
If you need help filing, you can work with a Consumer Assistance Program in your state.
You have 180 days from the time you receive notice of claim denial to file your health insurance appeal letter. Once you file, your insurer must complete the appeal within 30 days if you haven’t received the service yet or 60 days if you’ve already received the service.
External Review
Requesting an external review lets you take the decision out of your insurance company’s hands and ask a third party to review your claim. You must file your health insurance appeal letter for an external review within four months of receiving a final determination that your claim was denied. You can also work with your doctor or another representative to have them file the request on your behalf.
The external review process will vary with your state of residence. In some cases, the federal government’s Department of Health and Human Services or an independent review organization will oversee the process. Some states have a process that goes beyond the minimums of federal consumer protection standards and will manage the process.
External reviews are more limited in scope than internal appeals. You can only request an external review for:
- Denials involving a medical judgment where you or your provider disagree with your insurer
- A denial that involves a determination that a provided or requested treatment is experimental or investigational
- Cancellation of coverage based on your insurer’s claim that you provided false or incomplete information when you applied for coverage
Standard external reviews take no more than 45 days, while expedited external reviews take a maximum of 72 hours or less, depending on the medical urgency of your case.
In most cases, external reviews are free, though insurers that have contracted with an independent review organization or using a state’s review process may charge a maximum of $25 for processing the review.
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Letter Templates
If you need to appeal a health insurance denial, you can use one of these health insurance appeal letter templates to help you get started. Consider sending the letter using certified mail to ensure that you can confirm that it has been received.
Health Insurance Appeal Letter Template 1: Internal Review
To whom it may concern,
My name is [Name], and I am a policyholder with [Insurance company.] I am writing this letter to file an appeal concerning the denial of a claim for [Procedure]. I have received an explanation of benefits dated [Date] and stating [Reason for denial.]
Explain in a paragraph or two why you believe the claim was denied in error. For example, “I was diagnosed with chronic back pain on 10/15/22, and my [Doctor name] at [Facility name] recommended [Treatment name]
Please review the enclosed documents and review your previous decision to allow for coverage of [Procedure] as this treatment is necessary for my health. If you require any additional information to provide coverage, please contact me at [Contact information] or my physician at [Doctor’s contact information.]
Thank you for your attention to this matter.
[Your Name]
[Your Address]
Enclosed in this letter:
[List of documents and supporting evidence included]
Health Insurance Appeal Letter Template 2: External Review
To whom it may concern,
I am writing to request an external review by an independent review organization of the final benefit determination that I received on [Date] which I have enclosed with this appeal.
I filed my request for an internal appeal on [Date] in response to a decision to deny my claim. Your review board returned a ruling, confirming the original decision to not cover this claim.
Explain why you’re filing this external review request, including any new relevant information. Keep this section factual rather than attempting to appeal to emotion.
Thank you for your attention. I look forward to your swift response.
[Your Name]
[Your Address]
Enclosed in this letter:
[List of documents and supporting evidence included]
Work With Your Provider
Dealing with a health insurance denial can be difficult, especially if they’re denying coverage for treatment that your doctor believes is necessary. Don’t be afraid to ask your doctor for help in communicating with your insurance company. A letter from your physician explaining why the care is essential could help your case.
In the worst case, if your insurer still refuses to approve your claim, you should reach out to the provider’s billing department to negotiate. Many healthcare providers are able to significantly reduce your bill or help set up payment plans if you’re having trouble paying for your care.
