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Strategies for Dealing with Health Insurance Companies
Guiding principles for dealing with insurance companies:
Don't rely totally on physicians and providers
What to do when you're told the service or equipment isn't
Determine what is covered:
Don't believe everything you're told
For employer provided commercial plans or COBRA plans: ask your employer's
human resources office to provide you with a copy of the portion of the
master policy that specifies what's covered
If you can't get it read the member handbook thoroughly
For questions concerning coverage under Medical Assistance- call the Health
Law Project at 1-800-274-3258
If there's a reasonable argument under the master policy that the service
or equipment should be covered, file an appeal (see below)
If not covered under the master policy try to make a deal
It is possible for folks at a hospital or providers office who deal
with the insurance companies to sometimes convince the insurance company
or HMO to cover something not normally covered where the uncovered service
is essential to ensure the effectiveness of another service the insurance
company or HMO is going to pay for.
Also possible where you can trade some coverage for an otherwise uncovered
Medical necessity determinations
What's needed in a letter of medical necessity:
Diagnosis of condition for which the service or equipment is needed
The specific functional limitation or medical problem of the individual
that the service or equipment is intended to treat or ameliorate
A detailed description of the service or equipment where the service is
new, unique or customized and- especially for equipment- specify what it
does in relation to the individual's functional limitation.
Where the service or equipment is new or controversial, evidence that the
service or equipment is effective (copies of studies if possible)
Where there are less expensive alternatives, the reasons why these alternatives
are not appropriate
Working with the prescriber
Don't rely entirely on the prescriber to handle the medical necessity documentation.
Doctors often don't like dealing with insurance companies or HMOs and don't
always do a thorough job of documenting medical necessity.
If a professional other than the prescriber has more information about
the factors above (such as a physical therapist may know more about the
individual's functional limitations or the specifics of the equipment being
requested, than the prescribing physician), make sure you get something
in writing from that professional and get it to the prescribing physician
so he or she can add it to their letter of medical necessity.
The individual should write down specifics on their function limitations
for the prescribing physician to add to his/her letter of medical necessity.
Ask to see the letter of medical necessity before the doctor's office sends
Where the plan offers a less expensive alternative
Try to anticipate this in the letter of medical necessity
If that doesn't work, have the professional you are working with (such
as a physical therapist) review the alternative and write up statement
of reasons why it would not be appropriate in this instance (note the alternative
doesn't have to be the best- it only has to be appropriate). Give that
to the prescribing physician and ask he/she write a letter incorporating
the pt's comments.
If the physician feels too intimidated by the plan to support you in this,
you may have to consider changing physicians.
If the prescriber will write the letter, file an appeal or grievance and
attach the prescriber letter.
If the prescriber insists that you try the less expensive alternative
Keep a log of any problems that result from the use of that alternative
or functional limitations that the alternative fails to improve.
Go back to the prescriber with the log and ask they represcribe the original
service or equipment including your log in their letter of medical necessity.
Whether the providers who are in the plan's network or
will accept the reimbursement offered by the plan are accessible and competent
Lack of providers with physically accessible offices (For HMOs and
If there isn't a provider within a reasonable distance that is physically
accessible within the network, can file a complaint under section
504 of the federal Rehabilitation Act (if the HMO/PPO has a Medicare or
Medical Assistance contract) or under Title III of the Americans with Disabilities
Act (ADA) with the federal Department of Justice at (202) 514-0301 or file
a lawsuit in federal court.
Could also submit an informal complaint with the State Dept. of Health
on the grounds that the network is inadequate- but the State Dept. of Health
does not have jurisdiction to enforce §504 or the ADA.
Lack of competent specialists
This is more difficult to fight. Need to provide evidence, usually
from the PCP, that your condition is sufficiently rare or complex that
it requires a specialist with very special training or experience.
You would then have your PCP request that you be allowed to go "out of
network" because the plan doesn't have a physician with the requisite training
or experience. Will usually need to file a grievance on these requests.
Filing appeals/grievances with "regular" health insurance ("indemnity plans")
We don't have state laws or regulations mandating a specific appeals process
so the appeal process is whatever the insurer chooses to provide.
Can go to court under a contract claim
For self-insured plans (contact your employer to find out if the plan is
self-insured), the final appeal is to the employer. If the employer
turns you down, you can file a lawsuit in federal court under a federal
law called "ERISA".
Filing appeals/grievances with HMOs and "gatekeeper" PPOs
(Preferred Provider Organizations)
Complaints vs. Grievances
When a person in an HMO/PPO wishes to contest a decision about their health
care, it is important they file a grievance rather than a complaint.
Complaints do not entitle a subscriber to any of the grievance rights set
out below. Unless the request or dispute is put in writing by the
subscriber with a clear indication that it is a grievance, the HMO/PPO
may consider it only to be a complaint. Therefore, any dispute from
a subscriber should be put in writing and should have the word "Grievance"
at the top.
Levels of Grievances
A grievance is an opportunity for a subscriber to have his/her request
or dispute heard and decided by persons who were not directly involved
in making the disputed decision. These persons are called the "Grievance
Committee". HMOs may provide one or two levels of grievances which
are described below. If the subscriber goes through the levels of
grievance provided by his/her HMO/PPO, he or she can then take their grievance
to the Department of Health (also explained below). This memo also
explains special quicker procedures when the dispute involves a "medically
1st Level Grievance
The subscriber has the right to submit written information and have an
"uninvolved" HMO/PPO staff person assist in that effort. [¤9.73(1(ii)
&(7)] However, the subscriber does not have the right to attend
the grievance committee (although HMOs have been urged by the Health Department
to allow this).
The Grievance Committee decides the grievance. It must be comprised
of one or more employees of the HMO/PPO who were not involved in the decision
being appealed and were not involved in handling the complaint, if any,
that preceded the grievance. The Committee should review the grievance
within 30 days.
The Grievance Committee must issue a written decision within 10 days of
the date it meets to review the grievance.
If the Committee finds against the subscriber, even partially, the written
decision must contain: the reasons for the Committee's decision;
the evidence or documentation relied upon; and a statement regarding the
subscriber's right to file a second level grievance, the time limits for
filing the 2nd level grievance & how to file that grievance.
2nd Level Grievance
Note: An HMO/PPO may chose to limit its grievance procedures to a single
level so long as that level complies with the 2nd level requirements set
HMOs should provide between 30 and 60 days from the date the 1st level
grievance decision is issued for an subscriber to file a 2nd level grievance.
The Grievance Committee hears and decides the grievance. Committee
members are appointed by the HMO's Board of Directors. One third
of the Committee members must be subscribers.
Committee members may not have any previous involvement in the decision
being appealed or the 1st level grievance.
Date/notice of hearing
HMOs must hold hearings at "mutually convenient times" The subscriber must
be notified of the date & time at least 15 days in advance. The
hearing should be held within 30 days.
Right to appear/ be represented
Unlike the 1st level grievance, subscribers have the right to appear at
the 2nd level grievance hearing and present their case. They also
have the right to be represented by a person of their choice, including
a non-involved HMO/PPO staff person. However, failure to appear is
not grounds for dismissing the grievance.
Right to question staff
The subscriber has the right to question HMO/PPO staff at the grievance
hearing concerning the dispute.
Disputes involving differing physician opinions
Where the subscriber has documentation from a physician contradicting the
opinion of his/her primary care physician or the HMO/PPO Medical Director,
the Grievance Committee cannot automatically assume the PCP or Medical
Director is correct. It must make an independent assessment.
The HMO/PPO must have written procedures for utilizing "informed consultants"
to resolve grievances.
The written decision of the 1st level grievance must be the basis for deliberation.
If the HMO/PPO has an attorney to represent the staff making the decision
appealed from, it must also provide an attorney for the Grievance Committee
(but has no obligation to provide an attorney for the subscriber).
Written minutes or a tape recording of the hearing must be made.
The grievance Committee must render its decision within 10 working days
following the hearing.
The Committee must send a written decision to the subscriber which must
include: the evidence or documentation relied on by the Committee; the
rationale for its decision; and a statement that the subscriber has the
right to appeal to the Department of Health.
3rd Level Appeal- Dept. of Health
The subscriber has 30 days to file his/her appeal with the Dept. of Health
"unless extenuating circumstances are involved."
How to appeal
Appeals to the Dept. of Health are to be made in writing and mailed to:
Bureau of Managed Care
Room 1026 Health & Welfare Bldg.
Dept. of Health
PO Box 90
Harrisburg, PA 17108-0090
The Dept. of Health may hold its own hearing, require the HMO/PPO to rehear
the grievance to address specific issues or decide the case on the documentation
supplied by both sides.
Expedited grievances for "medically pressing issues"
When the dispute involves care which is alleged to be medically necessary
and "pressing" [not defined by the Dept. of Health], and the care has not
yet been provided, the HMO/PPO must render an initial decision approving
or denying the care in writing within a "reasonable time" which is defined
by the Department as 48 hours. If the subscriber appeals that decision,
the grievance would begin at the 2nd level.
Persons on Medical Assistance in HMOs
Persons on Medical Assistance in HMOs have all the rights set out above
and also have the right to file an appeal with the Department of Public
Welfare. There are also special rules that apply to grievances under
the "HealthChoices" program. To file an appeal with the Department
of Public Welfare, write your name, address and phone number, name of your
HMO/PPO, your HMO/PPO subscriber number and the decision you are disputing
on a piece of paper. Put "Appeal" at the top of the paper.
Mail the appeal to:
Department of Public Welfare
Office of Medical Assistance Programs
P.O. Box 2675
Harrisburg, PA 17105-2675
What to do for more help
The PA Health Law Project is available to advise and assist persons with
disabilities and persons on Medical Assistance in disputes with their HMOs.
You can reach us by calling 800-931-7457 or 800-274-3258. You can
also call the PA Department of Health, Bureau of Managed Care (which licenses
HMOs) at 888-466-2787.