How to Handle Insurance Claim Denials: Steps to Appeal and Win

Common Reasons for Insurance Claim Denials

Before you appeal, it’s important to understand why your claim was denied. Some of the most common reasons include:

1. Incorrect or Missing Information – Errors in your claim form, such as incorrect billing codes, misspelled names, or missing paperwork, can trigger an automatic denial.
2. Lack of Medical Necessity – The insurer may argue that the procedure or treatment was not medically necessary.
3. Out-of-Network Provider – If your provider was outside your insurance network, your claim may be denied.
4. Pre-Authorization Not Obtained – Some procedures, tests, or medications require prior approval from the insurance company.
5. Service Not Covered – Certain treatments may be excluded from your plan.
6. Timely Filing Issues – If your doctor or hospital submits the claim too late, the insurance company may refuse to pay.
7. Coordination of Benefits (COB) Issues – If you have multiple insurance plans, there may be confusion over which insurer is responsible for payment.

Once you understand why your claim was denied, you can take the necessary steps to fix the issue and appeal the decision.

Steps to Appeal a Denied Health Insurance Claim

1. Review Your Explanation of Benefits (EOB)

After a denial, your insurance company will send an Explanation of Benefits (EOB). This document outlines:

• What was billed
• What the insurance paid (if anything)
• The reason for the denial

Carefully read this document and compare it with your medical bills and provider’s records to spot any discrepancies.

2. Contact Your Insurance Provider

Call your insurance company’s customer service number (found on the back of your insurance card) and ask for a detailed explanation of the denial. Key questions to ask:

• Why was the claim denied?
• Is there missing or incorrect information?
• Can the denial be reversed without a formal appeal?
• What documents do I need to submit for an appeal?

In some cases, a simple error (like a wrong billing code) can be corrected by your doctor’s office, and the claim can be resubmitted without an appeal.

3. Gather Supporting Documents

If the denial stands, start preparing for an appeal by gathering:
✔ Medical records and doctor’s notes – These help prove that the treatment was medically necessary.
✔ A letter from your doctor – Your provider can explain why the treatment was necessary and support your appeal.
✔ A copy of your insurance policy – Check your benefits to confirm that the service should be covered.
✔ Billing statements – Compare them with your EOB to ensure there are no mistakes.

4. Write an Appeal Letter

Your appeal letter should be clear, concise, and factual. It should include:

• Your name, policy number, and claim details
• Reason for the appeal (reference the EOB and insurance policy)
• Supporting medical evidence from your doctor
• Request for reconsideration and payment of the claim

✅ Example Appeal Letter:

[Your Name]
[Your Address]
[City, State, ZIP]
[Phone Number]
[Date]

Insurance Company Name
Claims Department
Insurance Company Address

Subject: Appeal of Denied Claim [Claim Number]

Dear [Insurance Company Representative],

I am writing to formally appeal the denial of my claim for [specific medical treatment or procedure], which was received on [date]. According to my Explanation of Benefits, the reason for the denial was [state reason, e.g., “service not medically necessary”]. However, this treatment was essential for my health and was recommended by my physician, Dr. [Doctor’s Name].

Enclosed are supporting documents, including a letter from Dr. [Doctor’s Name], medical records, and a copy of my insurance policy outlining coverage for this service. Given this information, I respectfully request that you reconsider your decision and approve my claim.

Please respond within the required time frame as stated in my policy. I appreciate your prompt attention to this matter. If you need additional information, I can be reached at [your phone number or email].

Sincerely,
[Your Name]

5. Submit Your Appeal

Send your appeal and all supporting documents to the insurance company by certified mail with a return receipt or through their online claims portal (if available). Keep copies of everything you send.

6. Follow Up

After submitting your appeal:
✔ Call your insurer to confirm they received it.
✔ Ask for an estimated response time.
✔ Keep notes of all conversations (date, name of representative, and details).

Insurance companies typically respond within 30 to 60 days, depending on the type of appeal.

What If Your Appeal Is Denied?

If your first appeal is denied, you still have options:

1. File a Second-Level Appeal

• Request a review by a higher authority within the insurance company.
• Submit any additional documentation that strengthens your case.

2. Request an External Review

If your second appeal is denied, you can request an independent, third-party review. The insurance company must abide by the decision made in an external review.

• Time Frame: You usually have 4 months to request an external review after your final denial.
• How to Request It: Your insurer will provide instructions on how to submit your case for external review.

3. Contact Your State Insurance Department

If your claim was wrongly denied, your state’s Department of Insurance may help advocate on your behalf. Find your state’s agency at National Association of Insurance Commissioners (NAIC).

4. Consider Legal Action

If your denial involves significant medical costs, consulting a lawyer who specializes in healthcare claims may be an option.

Tips to Improve Your Chances of Winning an Appeal

✅ Appeal quickly – Most insurance plans have strict deadlines for appeals (typically 60-180 days after the denial).
✅ Be persistent – Many claims are denied automatically but reversed on appeal.
✅ Get help if needed – Your doctor’s office, a patient advocate, or a lawyer can assist with appeals.
✅ Stay organized – Keep copies of all documents and correspondence with your insurance company.

Final Thoughts

A denied insurance claim doesn’t always mean you’re out of luck. By understanding the reason for the denial, gathering strong evidence, and following the appeal process, you can significantly increase your chances of getting your claim approved.

If your initial appeal is denied, don’t give up—many claims are approved on second review or through external appeals. Stay persistent, be thorough, and advocate for the coverage you deserve.

For more resources, visit HealthCare.gov or contact your state’s insurance department for assistance.