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Linda Collins Blogger

Understanding Denials: Private Payer Claims

Posted by Linda Collins | September 30, 2015

One common reason for claim denial is "lack of medical necessity." Without understanding the details behind this generic denial reason, it is almost impossible to prepare a logical appeal. What resources are available to provide more information about the specific denial? A recent post outlined the online tools available to assist with Medicare claim denials (see Understanding Denials: Medicare Claims). This post offers insight into private payer claim denials and resources.

When a claim is denied by a private insurer, the denial letter may be sent to either the patient, the prescribing physician and/or the provider of services. The letter offers a reason for denial and typically references the supporting documents. For example, the letter may reference the payer's medical coverage policy or the patient's benefit plan design document.

Thoroughly review the letter to determine the exact reason for denial. The letter will also give you information about the appeal process, internal and external, including contact information. Insurers are required to provide denial reasons, references used in reviewing the claim, and appeal procedures. Read the letter.

Once you have determined the reason for denial and the appeal process, gather the appropriate documents to assist in preparing the appeal. These documents may include copies of the payer's medical coverage policy, the patient's plan benefit design and the patient's medical record. If the denial letter references a particular document which you do not have, call the payer and ask for a copy.

At times, the private payer may state the appeal rights belong to the patient. In this case, you will need to ask the patient to obtain a document from the payer that assigns the appeal rights to you, the provider.

If your insurance company continues to deny services to you after the first appeal, you will be notified of the next step in the appeal process. After you gather the facts, set a strategy. Many states offer help to consumers with health insurance problems through Consumer Assistance Programs. They provide residents with direct help with problems or questions about health coverage, by phone and email.

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