In the event of a medical problem, most seniors rely more on an insurance policy they've faithfully contributed to for decades. Such a cover will come in handy when taking care of your medical expenses, which can be hefty.
Unfortunately, you might be surprised to discover that not all insurance companies act in good faith, especially when you need them the most. This article will give you a brief overview of the health insurance industry, specifically in regards to denial of senior benefits and claims. It will also explore the various ways in which your claims can be denied, as well as giving you insights on how to handle such an outcome.
Types of Benefits Available to Seniors
As far as health insurance goes, you have three main options to choose. These are:
This is a health insurance program provided by the federal government. It’s made possible through contributions from the government and taxes deducted from your salary during employment.
This program is run by various states with support from the federal government. It is usually referred to as an insurer of last resort because it offers services to low-income individuals.
Private employers mostly offer these and it’s the most expensive option of the three. If a private insurer covers you, you will be eligible for more benefits. The downside though is that such companies have stringent policy requirements. Depending on your risk factor assessment, you might end up paying a lot in premiums.
Some private insurers also provide a service known as Medigap. This service enables you to access benefits that aren’t available under Medicare. Medigap does not provide long-term care.
Understanding Healthcare Laws
The government offers seniors and policyholders in general, some rights as far as healthcare provision services are concerned. Such guarantees will go a long way in helping you should you ever find yourself in a tight situation.
Under the healthcare law, your insurance provider should not charge you more for your pre-existing health challenges. Under the law, insurers are also obligated to provide preventive health services at no extra cost to you. Such services include medical screening and various shots.
Insurance companies are heavily scrutinized to prevent punitive increases in rates that might harm policyholders. Additionally, you have a right to receive an explanation from your insurer for increases in rates of or above 10% before raising your premiums.
Federal healthcare laws also make it illegal for your insurer to cancel your coverage just because you’ve fallen ill. It’s also a crime to cancel a policy due to minor errors in your application forms. In the past, these are some of the excuses insurance companies used to deny claims and cancel policies.
The law gives you a more excellent choice concerning the kind of doctor you choose. From your insurer’s network of healthcare providers, you’re free to choose anyone you like. Other benefits available under the law include:
- Mental health services are treated as essential.
- The right to appeal a health plan decision by your insurer that you might not agree.
- Protection against retaliation by your employer concerning choices you make about your health plan.
The Concept of Bad Faith
Insurance bad faith occurs when a company deliberately engages in acts that might harm the policyholder. If such actions are applied to your claim, the consequences include:
- The claim getting unnecessarily delayed
- Getting underpaid
- Being denied altogether
Bad faith on the insurer’s part is suitable grounds for legal action by the affected policyholder. In the past, insurance companies were only required to pay the amount specified in the contract with the insured. This encouraged a culture of impunity within such companies. They knew that if found guilty, the courts would compel them to pay what they would have paid you anyway.
Today, competent lawyers regularly win their clients huge payouts. Such awards sometimes are to the tune of millions of dollars above what the client’s contract with the insurance company stipulated. The reason for such payments is to punish the companies for breaching contracts with their customers. With these settlements, insurers are reminded that their duty to policyholders goes beyond their contracts.
How Widespread is Insurance Claim Denial?
While millions of claims are denied each year, seniors have been documented to suffer the most. Insurance companies have been increasingly charging them more in premiums for coverage. As a senior, you’re also more likely to be denied coverage or claims due to pre-existing conditions.
This puts you at a disadvantage as far as making claims goes. Due to your age, your insurer is more likely to come up with excuses to deny your request. Such explanations could include changes in your health over the years or your financial position.
Contents of Your Contract with an Insurance Company
The contract you sign with your insurance provider sets out some rules that both parties are supposed to observe. The company has some obligations towards you - the policyholder. Some of them include:
This clause obligates the company to compensate you for any loss incurred due to the actions of a third party.
By buying a policy, you expect peace of mind. For that reason, an insurance company is expected to treat you fairly. Going against this policy means the company is acting in bad faith. An example of bad faith is denying legitimate claims from policyholders.
The company must inform you of any disputes that might be detrimental to you as long as your relationship lasts. Information that might end up hurting you financially should not be kept from you.
Duty to Defend
This clause obligates the insurance company to protect you at its own expense against any claims that might be brought against you by another party.
Commitment to Settle Under Policy Limits
This clause expects the insurer to be truthful in its obligation to pay claims according to the restrictions outlined. This should be upheld even if the claimant hasn’t asked for the full amount he or she is entitled.
Reasons Given for Insurance Claim Denial
To increase profits, insurance companies will try every trick possible to deny claims from you. While some of them might be justified, you should be wary of being misguided. Some of the legitimate reasons for denying claims include:
- Providing inaccurate information in your application forms. You should always do your best to provide accurate information. Sometimes it might even be your doctor’s fault. If there's any significant detail about your health or life changes, you should promptly inform your insurer.
- Abandoning premium payments. Failure to do this might severely impact your ability to receive compensation in the event you need it. You should always make sure your fees are up to date.
- Policy exclusions. If you claim a condition that is not covered by your policy, it will most likely be denied. It pays to read the fine print. You might be paying for policies in the mistaken belief that it will protect you, only to find out that’s not the case.
- Pre-existing medical conditions. This excludes many people from getting coverage, even after faithfully paying premiums for years. Sometimes insurers act like some conditions are okay, only to later use them as the reason for denying your claim. Ensure your insurer covers all situations you might have prior to the claim.
- Exceeding your policy limits. Each policy comes with stipulations as to the amount your insurer can pay towards your medical bills per year. It also breaks down these allocations depending on the procedure.
Before signing those policy forms, you’re advised to consult an insurance law expert. Such an expert will translate the fine print for you and make sure you’re not taken advantage of by your insurer.
Why Insurers Get Away with Claims Denial
Because of their deep pockets, more often than not insurers get away with denying legitimate claims. As an individual, mounting a legal challenge against a huge company can be daunting. Apart from being expensive, it is also a stressful experience. Given how long some lawsuits can last, most aggrieved individuals choose not to sue. Some even end up accepting lower compensation than they were entitled to under their policy. Others don’t even know there are attorneys who can help take on their claim and battle the big insurance companies for rightful justice.
Tricks Used by Insurance Companies to Delay Claims
Despite being some of the most profitable companies in America, insurance companies will still find ways of improving their bottom-line. Unfortunately, some choose to do this through underhand tactics.
Through such dishonest tactics, such companies can take advantage of you by delaying, underpaying or denying your claim. One way they delay claims is by telling you they haven’t yet received your paperwork. They may also insist on more stringent, mostly unnecessary evaluations before your application can be looked into. A favorite tactic is to ask for further evaluation from your doctor(s).
Insurance companies might also offer to pay a lower amount than you’re entitled. Such underpayment might be in the form of a cheaper procedure than the one your doctor recommended. The company might also offer partial payment for the process or treatment you’re entitled to.
In some unfortunate circumstances, your claim will be denied. You might be informed that your condition is not covered under the particular policy you took. Other excuses might include being told your procedure is unnecessary, not authorized, is experimental, or cosmetic. You might also be informed your medical provider is not recognized by the company.
Some insurance companies will go as far as going through your medical history. The main aim of doing this is to find a pre-existing medical condition they can use as an excuse to deny your claim.
A further dishonest tactic used is delaying the claim until the policyholder dies. This is done mainly through excessive and needless bureaucracy specifically designed to wear you down.
How to Handle Insurance Claim Denial
If you ever find yourself in such a situation, there are steps you can take to rectify it. You must understand that you’re not powerless. The insurance company might have more resources at its disposal that might be used to frustrate you, but that doesn’t mean you should give up.
The first step you should take is to try and understand why the claim you filed was denied. Sometimes it could be a genuine mistake on your doctor’s part. Go through the statement of benefits with the assistance of your doctor and insurance company. You should also retrieve your policy documents, such as the Evidence of Coverage and Summary Plan Description. From there you can determine exactly what the provision is for your denied claim.
Remember to call your insurer’s customer care lines to seek clarification. Be careful about contacting them without keeping evidence though. Some insurers interpret such calls as an attempt of making another claim and might punish you further by raising your premiums. Additionally, it is recommended to handle and follow up all correspondence in writing, always ask for email or mail verification and do the same on your end.
This is also a good time to consult your attorney for legal advice. If there are any revisions to be made, do so and re-apply. Since insurance companies handle millions of claims annually, some denials might be due to computer software rather than malice. Some software might reject a claim due to technical aspects such as erroneous billing codes from hospitals.
Re-applying will not only fix some errors but also increase your chances of positive results. Remember to keep meticulous records as they’ll come in handy in future. Make sure to keep both physical and electronic records. Should the case go to court, you’ll be in a better position to provide evidence such as email correspondence between yourself and the insurance company.
Appealing Rejected Insurance Claims
If you decide to appeal a denial, you have two options. You can either appeal internally or externally.
This involves contacting your insurer and asking for a review of your claim. Your insurer is required by law to grant you this review. You’re required to fill forms to that effect and provide any useful documents that might help your case, such as documents from your doctor.
If your claim is still denied, you can then move to an external appeal. Other than giving you a valid reason for denying your claim, your insurer must also give you the process for filing an external appeal. Remember to keep all documents used to file your internal appeal.
You have a right by law to file an external appeal to an independent third party reviewer. This should ideally be done within 60 days of your insurer’s final denial. To ensure fair representation, your insurance company is required to take part in an external appeal process.
External appeals are usually heard and determined within 60 days of being filed. If you feel like your situation is urgent, you can apply for an external appeal even if you haven’t completed the internal process. The process can be hastened if continued delay presents a danger to your health or life. It is also possible to file both internal and external reviews at the same time.
Types of Denials that can be Appealed
If you believe your claim has been wrongly denied, you shouldn’t hesitate to file an appeal. Some of the cases that are open for appeal include denials due to:
- Pre-existing medical conditions
- No longer being eligible for the health plan
- Your condition being deemed “unnecessary or experimental” by your insurer.
- Claims by your insurer that you provided false information when signing up for coverage.
- Your insurer having a different opinion from that of your medical provider.
Why You Need a Lawyer to Defend You
You might easily get confused due to the sometimes complicated legal jargon you’re in the insurance forms. This confusion might lead you to sign up for a policy whose clauses might later be used by your insurer to deny your claim.
This is why you need a lawyer. Because they specialize in legal matters, they’re in a unique position to interpret to you exactly what is stated in the documents you’re signing. They understand exactly what the fine print says.
A lawyer who routinely deals with insurance companies on a daily basis is also more likely to understand their underhand dealings. Since he or she has your interests at heart, they will do their best to ensure you don’t get taken advantage of. Compared to you, lawyers can get insights from various cases they’ve handled in order to give you the best course of action.
They also have a reputation to uphold, so will they go the extra mile in pursuing a favorable ruling in your favor. If your appeal process fails, your lawyer can directly approach your insurer and try to negotiate. If all these fails, they will help you through litigation.
Finding Health Insurance Denial Attorney Near Me
In the unfortunate event that your insurance claim is denied as a senior citizen, you have no other option but to seek legal redress as time is of the essence. On top of frustrating you, insurance companies will try every trick to deny you of your right to fair compensation. A competent attorney can defend your interests.
At Stop Health Insurance Denial, our attorneys have years of experience and expertise with health insurance denial claims for seniors and our commitment to our clients is unmatched. Feel free to consult us about your legal options and the best course of action. You can call us at 310-695-5241 or fill out our contact form to schedule your free consultation. We do provide services throughout the entirety of the United States, every state and every city.