Relying on your insurance to cover a medication, course of treatment, or needed procedure after receiving a devastating diagnosis from your doctor is what health insurance is for, isn’t it? And yet many people in Oklahoma and other parts of the country may have to face more unpleasant news when they receive a claim denial.
Although an initial denial may not be the last word, sometimes taking on insurance companies requires knowledge of what goes on behind the scenes, and how these companies use grey areas of the policy or routine denials that affect millions of policyholders as a way of underpaying claims.
If these tactics violate the terms of the policy, there may be grounds for a lawsuit. Oklahoma City residents may be wise to find out more about the best way to persuade their insurance company to make good on their promises.
Reasons for denying a claim
Health insurance is a profitable industry, and, like any business, exists to make money. There are many reasons that an insurance company will deny a claim, so it is important to closely examine the terms of the policy, including the exclusions, to understand what is not covered. Common reasons for a claim denial include:
- The policy does not cover a certain medical treatment, that it lacks proper authorization, or is unnecessary. Remember, ambiguities in the policy usually weigh in favor of the policyholder.
- The policyholder misrepresented their health condition on the initial application.
- The insurance company issued a bad faith denial that lacks justification.
Some reasons the company may offer for a denial are that it is not necessary, that it is cosmetic, or that it is out of network. They may delay the claim, saying that a third-party evaluation is necessary. Or they may come back with a lower figure, stating that the claim was beyond the usual and customary charge for that medical treatment.
Taking steps to file a lawsuit
After the initial denial letter, the policyholder should find out the time limit for an appeal, and also check state resources that can assist with consumer complaints. It is possible to take your insurance company to court if the policyholder believes that they have violated the terms of the policy by either failing to pay legitimate claims, failing to pay claims on time, or making a bad faith denial. They may also be liable for a breach of contract claim.