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Part I | Part II

How to Win Denial of Health Benefit Litigation
Part II: Assume the Burden - Turn the Tide

A Publication of Skidmore & Associates, A Legal Professional Association

By: Eric E. Skidmore, Esq.

Not all health benefit claims are insured. Some may be legitimately denied by the insurer. To the extent the claim is insured and the insurer wrongfully denies coverage, you may have to litigate to enforce your rights. The key to winning denial of health benefit litigation is to first recognize the burden and then assume it. Part I of these materials provided a candid review of the burden placed upon participants to enforce their group health care benefits governed by the Employee Retirement Income Security Act of 1974 (“ERISA”) through the interpreted cases of the United States Sixth Circuit Court of Appeals.1 The playing field is not level between insurer and insured. ERISA favors the insurer.

Part I established the administrative phase of benefit enforcement to be critical because the courts will defer to the insurer’s discretion in determining benefit coverage at the litigation phase. The key to winning claim denial litigation is to create a detailed, methodical and rational evidentiary record during the administration of your claim which can be used later to persuade the court that the insurer’s discretion and reasoning are flawed.

Part II shall provide some practical guidelines to gathering evidence needed to turn the tide in favor of enforcing your health benefit rights. These appeals can be very complicated and technical so you may want to retain counsel to assist. If you choose to handle your own appeal, you may want to consider the following suggestions.

I. Proper State of Mind.

The process of benefit enforcement is not for the weak and timid. You have the innate ability to determine the outcome of events, however, you must be realistic. You should not fret over the things you cannot control. You can either adopt a lethargic attitude, or an “attack mode” attitude to illness and health benefit coverage. Educate yourself so you can make informed decisions about your health or the health of a loved one. EDUCATE, EDUCATE, EDUCATE - this is what you can realistically control.

Health benefit enforcement should not be the sole responsibility of the person who is ill. The patient’s attention should be focused on getting psychologically and physically prepared. Someone very close to the patient (i.e., parent, spouse, or adult sibling) should assume a supportive role of heading the “attack mode” to benefit enforcement. This “someone” should have a sincere and personal interest in the health of the patient. They will have the primary responsibility of getting the patient the proper health care and coordinating the claim coverage issues.

II. Understand the Illness(es).

Educate yourself and the patient as to the symptoms, causes and treatments for the illness. Resist the natural tendency of becoming preoccupied with illness. This is normal, however, it is important to get past the emotions of fear and uncertainty to take care of the business at hand. Do not dwell on “why me?”, instead face the realities by thinking “why not me?” Once you face the affliction, the quicker you can transition to doing something about it.

A. Research Medical Literature.

You must investigate and research the illness. Access reliable on-line internet Web sites to study the illness. Many medical schools and hospitals host Web sites with free access to archives and libraries. You will find additional materials at your local library and the libraries of medical schools and hospitals. Many medical associations post their studies and journals on the internet. Also use medical dictionaries to develop a working vocabulary for the diagnosis, causes and treatment of an illness. This will foster better communication with health care providers.

B. Communicate with Health Care Providers.

Develop good communication with the patient’s health care providers. Obtain their names, addresses, phone numbers, fax numbers and e-mail addresses. Get to know the staff members, secretaries and nurses of your doctor and specialists. Whenever you visit your health care providers, medical records are generated. You should obtain copies of the relevant medical records. If you have any questions as to the content of the records, you should submit your questions to the proper health care provider. If you do not understand the terminology, look the words up in medical dictionaries. Your health care providers will often times be your best ally in the enforcement of your rights.

Prepare a calendar solely attributed to scheduling and tracking appointments with health care providers. Educate yourself as to the purpose and object of each appointment - what is to be accomplished? Prepare questions to ask during the appointment, note documents that are generated and do not leave without a full understanding of what is expected next. Keep track of when medical reports and imaging will be available and which health care provider will review and render a responsive opinion. Keep detailed notes of all visits, appointments, phone calls and procedures. If the insurer denies your claim and appeal, your health care providers could be utilized as fact and expert witnesses later.

III. Understand Your Insurance Coverage.

You should obtain an understanding of your health care coverage at the time you become employed. You should immediately obtain a summary plan description (“SPD”) which is an abbreviated version of the plan of health care benefits provided by the employer, plan administrator or insurer. Do not wait until you are ill before you acquaint yourself with coverage. The coverage decisions you make at the outset can greatly affect coverage issues that develop later. Make sure there are no coverage inconsistencies between the terms in the plan and the SPD.

Knowing medical and insurance terminology will assist you in the claim denial-appeal process. If you have any question as to coverage, utilize the toll-free numbers to ask the insurer questions. Do not accept anyone else’s explanation of medical coverage except your own reasonable interpretation. You must educate yourself as to the internal structure of the insurer and determine who makes the decisions, how claims should be presented, to whom claims should be presented and the time line in which claims should be presented. Also discuss coverage issues with the employer’s health services department.

IV. What Do You Do When You Receive a Rejection Letter?

A. The Rejection Letter.

When claims are rejected, the insurer will issue a letter stating the reasons for the denial. Reasons may include the following: not medically necessary, pre-existing condition, not a covered benefit, termination of coverage, failure to seek pre-approval, out-of-network provider, untimely filing and experimental treatment. The appeal time commences from the time the rejection letter is issued. You should immediately organize and prepare the appeal.

B. Seek Assistance from Your Health care Providers.

In preparing your appeal, immediately seek help from your health care providers. They know you and your condition. Provide them with a copy of the rejection letter. Request them to respond by stating reasons why you need the treatment, service or drug and include these in your appeal. If needed, provide your doctor with the applicable SPD and plan provisions. If the denial presumes certain factual assertions or conclusions that are inaccurate, request that the health care provider respond to them.

C. The Appeal.

Take responsibility for your own appeal and either initiate or assist the health care provider in appealing your denied claim. Under no circumstances do you take a passive approach and rely solely on others to appeal the denied claim. Utilize all of the medical documentation that you have acquired during the diagnosis stage. Include these materials in your appeal to help develop the record. Developing the administrative record could level the playing field with the insurer, especially if the insurer’s interpretation of coverage is contorted. Once you have gathered the responses of the health care provider(s), supporting documentation and relevant citations to the SPD and plan, you should prepare and submit your appeal package. Your appeal should include a brief summary of the diagnosis and treatment of the illness. It should recite the date when the claim was submitted and when the rejection letter was issued. You should identify your health care providers and state that it is their opinion that the claim should be accepted and the appeal approved.

Request a copy of the standards and guidelines utilized by the insurer to deny the claim. This will help you to determine whether or not the denial was flawed, biased, incorrectly applied or improperly reasoned. To the extent that the insurer does not disclose the standards and guidelines, you can indicate that their non-disclosure hinders your appeal. If the insurer discloses the standards and guidelines then use your medical records and literature to satisfy the elements and distinguish the insurer’s position.

As a part of your appeal, specifically request the documents and other information offered in the rejection letter. Request reasonable access to and copies of all documents relevant to the denied claim and an explanation of the scientific and clinical judgment used in making the denial. Request applicable excerpts of the plan and SPD relied upon by the insurer to reject the claim. Keep a copy of your letter and send your appeal packed via certified mail (return receipt requested) to the address listed in your SPD. This will confirm that you timely filed the appeal in case the insurer loses or misplaces it. The SPD may require that you appeal the denial numerous times before you can litigate.

V. Litigation of Claim Denial Disputes.

By the time you litigate the claim denial, you will have already cultivated an evidentiary record at the administrative stage. Remember the court will invoke a “deferential standard” favoring the insurer as long as the denial was rational. The insurer’s discretion is reviewed upon the facts known and applied at the time the denial was made, therefore you can introduce the entire administrative record. This is the only way an insured can satisfy the burden of proof that the insurer’s denial was unreasonable. Attempt to show how the insurer’s interpretation is inconsistent with the plain meaning of the plan. Is the plan language ambiguous and susceptible to conflicting interpretations? You may be able to turn the tide against the insurer at trial by introducing demonstrative evidence, documents, medical records, testimony of fact and expert witnesses developed at the administrative level.

VII. Conclusion.

Once your insurer has denied a health benefit claim, it puts you in a difficult position to enforce your rights. Appreciate the burden because it is on you. Assume the burden and use administrative records to help you turn the tide against the insurer who denies a covered health care benefit.