Subject: Dealing with your Insurance Company
Date: Tue, 14 Oct 1997
From: David Gates <email@example.com>
Organization: PA Health Law Project
Strategies for Dealing with Health Insurance Companies and HMOs
Guiding principles for dealing with insurance companies:
- Document everything
- Don't rely totally on
physicians and providers
- Be persistent
What to do when you're told the service or equipment isn't covered:
Determine what is covered:
- Don't believe everything
- 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 service
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
- 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 it out.
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
- 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 PPOs)
- 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
- 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
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
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
- 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 pressing
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 out below.
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
- 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
- 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
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
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
- Put "Appeal" at the
top of the paper.
- Mail the appeal to: Department
of Public Welfare Office of Medical Assistance Programs HealthChoices Program 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.
drafted by David Gates 10-14-97
Permission granted by David Gates to reprint article with credit attributed to the PA
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