If your Medicare Advantage plan denies you payment or medical services, don’t take it lying down.
Dealing with a denial
It’s critical that you read the denial notice carefully. Understand why your claim or service is being denied.
Understand your rights to appeal and how to appeal.
♦ Most importantly, file an appeal promptly. The odds are in your favor that the plan will overturn its decision.
Don’t be afraid to ask your doctor to write a letter supporting your claim.
• Appeals can be filed for reasons related to your benefits and coverage, with problems related to payment being the most common.
Appeals can be for medical services but also for prescription drugs.
• In 2021, more than 35 million prior authorization requests were submitted to Medicare Advantage insurers.
Over 2 million of these prior authorization requests were fully or partially denied.
• Just 11 % of prior authorization denials were appealed.
• The vast majority (82%) of appeals resulted in fully or partially overturning the initial prior authorization denial.
It pays to appeal.
Medicare Advantage plans were given permission in 2018 to start using step-therapy – requiring a cheaper drug first be used – before a more expensive drug is paid.
If you joined a new plan, it may refuse to pay for an expensive prescription drug until you prove to them that you have already tried other drugs. This can usually be handled over the phone. Your plan may take your word but if the drug is very expensive they will likely call your doctor and confirm.
• An appeal may be filed by you, someone else acting on your behalf or the provider.
The Medicare Advantage appeals process includes four levels of review by several entities. At each level of review, a denied claim may be overturned, partially overturned, or upheld.
The Center for Medicare and Medicaid Services (CMS) refers to the insurance company and the Medicare Advantage plans they promote as Medicare Advantage Organizations (MAOs). We will refer to them simply as the Plan.
If the denial is overturned, then the Plan must authorize or pay for the service. If the denial is NOT fully overturned the beneficiary or provider may appeal the decision to the next higher level of review.
♦ If any party is dissatisfied with the appeal decisions after completing all four levels of appeal, they may request a review in Federal court.
The Plan and Quality Improvement Organization
For most first-level appeals, the Plan’s administrator (insurance company) itself must reconsider its decision. (75% of denials are overturned at this stage)
The Plan must review the evidence that led to the original decision and any additional evidence the beneficiary or provider may submit as part of an appeal.
• You must follow you Plan’s procedure for submitting an appeal. Many Plans have been fined by CMS for not providing clear or accurate information needed to submit an appeal. Do not be deterred and do not give-up.
Be prepared to submit a written explanation of why you don’t agree with the initial determination to deny payment or services. Do not be afraid to enlist your doctor’s help. Keep copies of everything.
Once the plan receives you request, it must make its decision and notify you of its decision as quickly as your health requires, but no later 72 hours for expedited requests, 30 calendar days for standard requests, or 60 calendar days for payment requests.
If the decision is unfavorable to you, in whole or in part, the plan must submit the case file and its decision for automatic review by an Independent Review Entity (IRE).
♦ Plans maintain separate processes to review and resolve appeals from in-network and out-of-network providers.
Appeals from in-network providers generally are considered contractual disputes that are handled by the Plan directly and cannot be appealed to the higher levels of administrative review.
Appeals from out-of-network providers who formally waive their right to bill a beneficiary (you) for the service under appeal may go through the same appeal process. If the Plan upholds its denial for appeals, it must forward the appeal to the next level called an Independent Review Entity for review.
Quality Improvement Organizations
If the appeal pertains to discharge from a hospital or the discontinuation of certain types of service a Family Centered Care Quality Improvement Organizations will be the first-level review for the appeal. (26% of denials are overturned)
Be prepared to submit a written explanation of why you don’t agree with the initial determination. Be sure to include the dates and specific items or services you are asking to be reconsidered. Do not be afraid to enlist your doctor’s help in making your case.
• Quality Improvement Organizations work under the direction of CMS and are staffed by doctors and other healthcare professionals trained to review medical care and help beneficiaries with complaints about the quality of care.
If the Quality Improvement Organization upholds the Plan’s decision to discharge the beneficiary or to discontinue services, beneficiaries may request that the Quality Improvement Organization reconsider its decision.
If the Quality Improvement Organization upholds its decision again, the beneficiary may appeal to an administrative law judge which would be the third level of this type of appeal.
Independent Review Entity
The Independent Review Entity reviews appealed denials that Plans uphold to determine whether the Plan made the correct decision. (10% of denials are overturned)
♦ In most cases, the appeal will be forwarded automatically to the Independent Review Entity. You must be sure to read all communications you receive to be sure that this was done or not. If not, you can ask them to do so or you may submit the appeal yourself.
•You have 180 days from the date of receipt of the decision from your first-level appeal, to file your request for an Independent review.
You should prepare a written statement explaining why you disagree with the decision to deny your claim. Make sure to state your argument as clearly and in as much detail as possible. Ask your doctor prepared a statement to support your argument.
• A decision on your appeal will usually be issue within 60 days.
The Independent Review Entity is a CMS contractor that employs physicians and other consultants to review the denials and determine whether Plan complied with relevant Medicare requirements.
If the Independent Review Entity upholds or partially overturns the Plan’s denial, beneficiaries and providers may choose to appeal to the next level.
Administrative Law Judge
Administrative law judges, within the Office of Medicare Hearings and Appeals, review appeals of Independent Review Entity or Quality Improvement Organization decisions. (27% of denials are overturned)
• 1,100 to 1,600 appeals used to reach this level every year. That number has skyrocketed leading to a backlog of 86,000 appeals as of June 2021.
The U.S. District Court for the District of Columbia has ordered HHS to clear the backlog by the end of fiscal year 2022. HHS seems likely to meet its target.
♦ In order for your case to be eligible for this level of review, it must meet a specific dollar amount. The sum is not huge (over $180 in 2024). For reconsiderations issued by a Quality Improvement Organization, the minimum amount in controversy is $200.
• You have 60 days, from receipt of the decision from your second-level appeal, to file your request for an administrative law judge review.
If your appeal is heard by an Administrative Law Judge (ALJ), it is often done by phone but in some cases in person. You also have the right to request the ALJ review the information independently and make a decision without hearing your testimony.
The ALJ may decide to make a decision without hearing your testimony if he or she feels there is already enough information to reach a decision in your favor.
• A decision will usually be issued within 90 days.
If the beneficiary, provider, or Plan is dissatisfied with the decision of the administrative law judge, they may choose to appeal to the next level.
Medicare Appeals Council
The Medicare Appeals Council, within the Departmental Appeals Board, reviews beneficiary, provider, and Plan appeals of decisions by an administrative law judge.
♦ 30 appeals reached this level in 2016. The number has soared over the years. HHS doesn't easily share the numbers for the backlog.
• You have 60 days, from receipt of the decision the administrative law judge, to file your request for a review by the Medicare Appeals Council.
A decision will usually be issued within 90 days. (23% are overturned) Due to an overwhelming number of Council review requests over the past several years, the Council has not been able to meet the 90-day time frame. There is a backlog.
♦ The Council provides the last level of review within the Department of Health and Human Services’ Medicare Advantage appeals process.
If you, providers, or the Plan are dissatisfied with the decision of the Council, they may appeal to Federal district court by filing a civil action.
Judicial Review in Federal District Court
• You must file an action in a Federal district court within 60 calendar days after the date you receive notice of the Council's decision.
♦ In order to request judicial review in Federal court, the amount remaining in controversy must meet a threshold requirement. For calendar year 2024, the amount in controversy must be more than $1,840 ($2,000 for reconsiderations issued by a Quality Improvement Organization). This amount is recalculated each year and may change.