A CONSUMER GUIDE TO HANDLING DISPUTES WITH YOUR EMPLOYER OR PRIVATE HEALTH PLAN

MISTAKES THAT MAKE EXTERNAL APPEALS INELIGIBLE

Many appeals are not eligible for state external appeals programs for a variety of reasons. For example, in 2003 under Maryland’s program, 69% of consumer appeals based on medical necessity could not be accepted because:

the state did not have jurisdiction to decide the case -- for example, the health plan was a self-funded employer plan (41%, or 349 out of 1,229 non-accepted cases),
the health plan’s internal appeal process had not been completed (34%, or 289 cases), and
the consumer failed to provide necessary information so the case was closed (14%, or 119 cases).⁽⁹⁾

Other states report similar experiences. North Carolina indicates that its external review program did not accept 53% of the requests it received for external review during the period January 1, 2003-December 31, 2004. The most frequent reasons for not accepting the requests were:

the appeal did not involve a medical necessity determination (20%, or 38 of 188 non-accepted cases),
the insurer’s internal appeal process had not been exhausted (19%, or 35 cases),
the external review program did not have jurisdiction -- for example, it was a self-funded employer plan (13%, or 24 cases), or
the request was incomplete (11%, or 21 cases).⁽¹⁰⁾

These experiences demonstrate that many consumers make mistakes with their external review appeals, including filing with the wrong agency, failing to exhaust their health plan’s internal appeal procedure, or failing to provide all the necessary information (such as consent forms) that is needed to investigate their case. It is important to understand and follow your health plan’s internal appeal process and your state external review program’s procedures and requirements as you pursue your appeal.

Many appeals are determined based on the exclusions contained in the health plan contract. Several states review applications for external review to determine whether the denied service is actually covered by the health plan’s contract before sending it on to an external reviewer. Although most states do not publish statistics on the number of requests that actually concern contract disputes (rather than determinations of medical necessity or whether the treatment is experimental or investigational), the few statistics that are available suggest that misunderstanding of contract exclusions is widespread. It is important that you read a current version of your health plan contract to know what these exclusions are.

⁽⁹⁾ The Maryland Insurance Administration’s 2003 Report on The Health Care Appeals & Grievance Law, August 2004, pp. 8-9 and unnumbered Appendix, at http://www.mdinsurance.state.md.us/documents/AppealsandGreivanceReport2003.pdf.

⁽¹⁰⁾North Carolina Department of Insurance, Healthcare Review Program Semiannual Report for the period January 1, 2003-December 31, 2004, pp. 8-11, at http://www.ncdoi.com/consumer/erp/externalreviewreport5.pdf.

< Return to Report Index

Next Section >