One of my current favorite TV
commercials is one advertising the services of a local personal injury law
firm. The actors in it depict insurance
adjusters who are trying to minimize their financial loss in a personal injury
claim by using the “three D’s”: Delay, Deny, and Devalue. (My wife can always tell what my favorite
commercials are; I go around the house mimicking the actors and their lines:
“No, DEE-ny. I was going to delay but
then decided, ‘No, I’ll DEE-ny that claim’”.)
Of course, insurance companies
make great villains. They are always
portrayed negatively, giving more attention to their bottom line than to the insured’s
interests, and in my opinion they don’t do much to dispel the image.
By coincidence, Kiplinger’s
Retirement Report a couple of months ago ran a piece titled “Fight a Denied
Advantage Claim” that cited some interesting statistics from the Office of the
Inspector General (OIG) of the U.S. Department of Health and Human Services. Let’s explore it a bit.
Medicare Advantage plans are
operated by insurance companies under contract with Medicare. You may hear them advertising that they offer
you benefits above and beyond what regular Medicare covers—things like dental,
vision, and hearing benefits. And they
offer these benefits at little or no additional cost to the Part B premium, and
sometimes they even rebate all or part of the Part B premium that is deducted
from the insured’s Social Security check.
But they can afford to do this by limiting their provider network (fewer
doctors and hospitals to choose from), requiring pre-authorization for many
services, strict application of rules for proper coding of claims by the
providers, enforcing a primary care provider gatekeeper model, and other means. It spells more work for providers’ offices
and many denied claims.
The OIG found that between 2014
and 2016 75% of denied Medicare Advantage claims were overturned upon
appeal. That is an astounding figure and
points to some very real problems with how these Advantage plans process
claims. But even more disturbing, when
coupled with that statistic, is the finding that only 1% of claims denied by
Advantage plans were appealed by either the enrollee or the providers. What must these Advantage plans be saving
through incorrectly denied claims that no one challenges? Little wonder they can offer more
benefits…especially if they find a way not to pay for them.
Perhaps there’s some truth to the
insurance company negative stereotype, particularly in the personal injury
field. But I can speak from experience
with Medicaid and Medicare insurance, that it is not typically the case in
medical insurance. No, the denied (or
underpaid) claims are less about bad intentions and more about bad
processes. So much of the processing of
medical claims is automated now; rarely, if ever, will there be a manager at
the insurance company saying “Dee-ny this claim! Dee-value that claim!”. Here is what is probably at the heart of your
improperly denied medical claim:
1. Someone
mis-programmed the automated claims processing software.
2. Someone
misunderstood or misinterpreted a rule for payment of certain types of claims.
3. A
provider was improperly set up in the insurance company’s database and was
wrongly disqualified for payment.
4. Someone
failed to recognize the unintended consequences of a certain action, leading to
incorrect claim denials.
Do you notice a common
theme? It’s incompetence. Someone made a mistake. An occasional mistake is understandable, especially
considering the complexity of the rules and requirements of government
insurance programs and of the software programs designed to automatically
adjudicate medical claims. But I would
expect better testing, more double-checking before a change or new process is
implemented. That would reduce errors
and inappropriately denied claims. But
you, as the enrollee, are on the hook for unpaid medical claims (at least
non-Medicaid claims). The provider often
doesn’t have the time and personnel to go to bat for you.
So allow me to put it this
way: “To err is human, to forgive is
divine, and to appeal a denied medical claim is genius.”
In my next post I will offer
ideas for how best to appeal a denied or underpaid claim or other adverse
determination by an insurance company.
Until next time,
Roger
“Don’t withhold repayment of
your debts. Don’t say ‘some other time,’
if you can pay now.” Proverbs 3:28 The Living Bible
