Tips for Getting Medical Claims Approved

In an ideal world, using health insurance would look something like this: You go to the doctor, the doctor submits a claim to your insurer, and your insurer covers the cost. "But as anyone who's ever interacted with the U.S. health care system knows, it doesn't always work out that way," says Katalin Goencz, president of the Alliance of Claims Assistance Professionals, whose members provide medical claims assistance and patient advocacy for individuals and businesses across the country.

According to KFF, a nonpartisan think tank, health insurance providers on HealthCare.gov denied nearly a fifth of all in-network claims. "It's better to avoid it if you can, but a denial isn't always the end of the road," Katalin says.

Here's what you need to know about getting claims approved, as well as what to do in the case of rejection or denial.

Before any procedure—even one you've undergone in the past—call your insurer to determine whether it's covered, if you need a prior authorization, and how much you'll be expected to pay out of pocket. For example, colonoscopies are typically deemed preventive care for those ages 45 and older under the Affordable Care Act and therefore should be fully covered. However, if a previous exam detected polyps, your next procedure may be considered diagnostic rather than preventive, which often requires you to bear part of the cost.

Even if a procedure is covered, your insurer may reject the claim before it's processed if it has incomplete or incorrect information. Check the associated rejection letter to understand what additional information you and/or your provider will need to resubmit to help successfully obtain an approval.

If your claim is processed and denied, look carefully at your insurer's explanation of benefits, or EOB. There's usually an explanatory code—typically two or three letters and numbers—that explains the denial. (Call your insurer if you don't understand the explanation.)

Many denials result from providers inputting incomplete or incorrect Current Procedural Terminology (CPT) codes, which cover the services you received, or International Classification of Diseases (ICD) codes, which cover diagnoses. There are also two-character CPT modifier codes; if your claim doesn't contain one where it's required, parts of your visit may not be reimbursed. When in doubt, ask your provider to recheck the codes and, if needed, file a corrected claim.

If your insurer denies a claim for a service it doesn't deem medically necessary, you have a legal right to appeal the decision—something 60% of insured adults surveyed by KFF were unaware of. Your denial letter should explain the appeals process, along with any deadlines. "It's also a good idea to look up the insurance plan's specific policy regarding the denied procedure to understand what can be done to dispute it," Katalin says.

In one instance, Katalin worked with a man who was denied coverage for an implanted device. After a little digging, they discovered the policy simply required proof from his physician that the man's condition had persisted for more than a year, which they were able to provide.

"Ultimately, the more specifics you know about your insurance policy and how it determines coverage, the better off you'll be in resolving rejections or denials," Katalin says.