June 26, 2023

Rejection hurts. And for those who have experienced the rejection of a job application, a turn down after a tryout, or the rebuff of a romantic overture, the feelings of failure and inadequacy can be hard to overcome. No one likes to be rejected! And that is especially true when it comes to having your own insurance company—to whom you have been faithful in paying those monthly premiums—reject your claim for coverage of a necessary and legitimate medical procedure.

Rejections on the Rise

The truth is denials of medical claims appear to be on an upward trajectory. Thousands of patients across this country are finding themselves in a situation where once quickly and easily paid claims are now being delayed and disputed and ultimately denied. To some, it would appear that insurance companies are utilizing computer algorithms or narrowly trained staff to deliberately slow down or sabotage payouts—often in a wholesale and inexplicable manner.

Last year, the Kaiser Family Foundation (KFF) released a report containing an analysis of medical claim denials and appeals in connection with health plans sold on the federal health insurance marketplace. Their analysis was based on data obtained and compiled by the Centers for Medicare and Medicaid Services (CMS). The report found that approximately 18 percent of in-network claims were denied on average during the reporting period. Again, this figure represents an average, meaning there are some health insurers who are way outside the norm. For example, KFF found that one commercial plan had a denial rate of 49 percent, while another was as high as 80 percent!

A Breach of Trust

The irony of this claim rejection trend is that lawmakers had put into place provisions just over a decade ago that were designed to prevent health plans from engaging in this very behavior. The Affordable Care Act (ACA) specifically precludes insurance companies from participating in schemes designed to thwart payment where the claim is clean and where the medical necessity is established. Yet, we have examples of the length insurance companies have gone to in order to put the brakes on reimbursements. Here are two representative stories gleaned by KFF:

• A Los Angeles man expressed shock when payment was denied for a heart procedure, especially given the fact that he had the insurer’s preapproval for the costly intervention. The claim had been rejected because the beneficiary had “asked for coverage for injections into nerves in your spine” (which he actually hadn’t) that were “not medically needed.” Months later, after dozens of calls and a patient advocate’s assistance, the situation is still not resolved. This is a particularly sad situation as the patient is now left with a bill of nearly $150,000.
  
  
• A college student suffering a life-threatening anaphylactic reaction was saved by epinephrine shots and steroids administered intravenously in a hospital emergency room. However, his mother was subsequently informed by their family’s insurer that the treatment was “not medically necessary.” The mother, who happens to be an ICU physician, stated that the worst part of the ordeal was that the denial letters made no sense in that they were “mostly pages of gobbledygook.” She has filed two appeals—so far, without success.

We can all recount similar stories. One of the provisions of ACA requires the U.S. Department of Health and Human Services (HHS) to monitor denial patterns exhibited by both the government marketplace health plans and those offered by employers and commercial insurers. The agency is also supposed to make this information available to the public so that each consumer can make better choices in selecting an insurance plan. According to some researchers, HHS has dropped the ball as it pertains to these tasks. That is, it is the view of some that the very agency charged with being a watchdog over the insurance industry has instead turned a blind eye and allowed the rise in denials that we are seeing today. As a result, patients may become more reticent to seek needed medical care, in the view of KFF researchers.

Dealing with Denials

According to KFF, “Consumers rarely appeal denied claims and when they do, insurers usually uphold their original decision.”  Indeed, the data demonstrates that beneficiaries appeal only one in every 500 cases. Beneficiaries and medical providers don’t always have the time and tenacity to get a payer representative on the phone and argue over every rejected claim.  This is why it is more important than ever for provider groups to partner with revenue cycle experts who have the resources and technical skill to tackle this.  

As denials rise, anesthesia and other providers can rest easy that we at Coronis Health will work through the appeals process to recover the revenues they have rightfully earned.  We know the tactics of the various players in the health insurance industry, and we have had long experience in overcoming the obstacles they place in the path of payment.  

If you have any questions on this topic, please reach out to your account executive.

With best wishes, 

Rita Astani
President—Anesthesia