What's the difference in the way that health insurance and disability insurance works?
Do you know how to respond or where to go for help when confronted with difficult and frustrating health or disability insurance problems? If you are like most people, the answer is “no.” The purpose of this article is to simplify what often feels like the impossible when you are trying to obtain benefits to which you are entitled.
HEALTH INSURANCE
Can I get reimbursed for the cost of a new prosthesis?
Maybe. This is the most common insurance problem for amputees. Your current prosthesis may be old and no longer working properly or satisfying your needs, or maybe you have outgrown it, or perhaps you've learned of new technological advances that would provide an opportunity for you to improve your level of functioning.
You apply to your health insurance carrier for an advanced authorization, or reimbursement, for what could be a $30,000-$50,000 (or more) device, and the insurer denies it. The usual reason is that your request is not “medically necessary” or that the device is “experimental,” something usually excluded from insurance policies. Here are steps you can take to appeal the decision.
- With the help of your prosthetist or advocate, prepare a thorough statement that explains why the device is essential to your life. Perhaps your job involves walking, bending or other physical activity that is difficult or impossible with your present prosthesis, and the new device would benefit you by reducing fatigue or increasing mobility. Or maybe you're a parent with children to chase around all day, requiring maximum agility.
Make appointments with several physicians in your healthcare network. Give them your statement and explain the problem. Ask each of them to give you a letter that states why the new device is medically necessary. - Get a research report from your prosthetist to show why the device is not experimental. Prosthetists are usually aware of the latest research on new products. They may have findings from studies to show that the device is effective and in use. Perhaps a government agency or other authority has approved its use. The prosthetist may also be able to provide a list of people who have received approvals from your insurer (or at least a simple statement of how many people have been approved). The prosthetist knows how to deal with privacy issues that might arise.
- Submit the material on appeal to the insurance carrier.
- If the insurer still denies your claim, contact your state insurance department and ask if there is an independent medical review procedure under state law. If not, ask if you can file a complaint against the insurance carrier (which the state will investigate). An independent review may allow an insurer's denial to be viewed again by medical personnel who are not affiliated with the insurance company. If the insurance department regulations provide for it to investigate complaints against insurers, it will at least ask the insurer to provide a written explanation of its actions. Insurers do not like to be in conflict with the state department that regulates them, so they are often receptive to its requests.
Will I always be able to get private health insurance if I am healthy?
No. It is much harder to get private health insurance than group health insurance. Insurers have been known to reject applications for private coverage if even mild ailments from the past are reported. Even if the insurer is willing to provide you with coverage, it may charge “penalty premiums” up to twice the normal premium or higher. An amputee in excellent health should expect problems in getting private coverage. Consider the following:
- If you have group coverage that is about to lapse because you are leaving work or for some other reason, try to extend it for as long as possible. Some plans have provisions for such extensions, as does COBRA (the Consolidated Omnibus Budget Reconciliation Act, a federal law that allows extensions of group insurance for 18 to 36 months). This subject is currently getting a lot of attention from lawmakers, so there may be changes in the insurers' practices in the foreseeable future.
- You or your advocate should negotiate with the insurance company to which you have applied for private coverage to either increase the deductible or pay a “penalty premium” (if you have been denied coverage) or reduce any such penalty after a given period of time (such as six months or one year) without any claims related to past history.
- See if you qualify for group coverage through a professional or alumni association or another group that may offer insurance coverage if you become affiliated. As long as you are not without coverage for more than 63 days after the date that your prior group coverage or any extension ends, you may qualify for enrollment in another plan without any preexisting condition limitations.
- If all else fails, see if your state offers health insurance to people who cannot receive it elsewhere. However, it may provide less coverage and cost more.
Would my insurance company ever cancel my policy after I make a claim?
Yes. This is another current “hot topic.” Insurers are canceling people's coverage right in the middle of their treatment for an illness, thus denying benefits. The insurers may claim that there is an aspect of the illness for which services are being provided that was not disclosed on the original insurance application, and therefore, coverage can be cancelled for misrepresentation. If this happens to you, consider the following:
- Write to your insurer and request a written explanation of the cancellation.
- Ask your doctor to write a letter that there was no such previous evidence of anything related to your current medical problem, and file it with the insurance company.
- Contact your state insurance department or a public interest law firm (you can get contact information by calling your county or state bar association) and request assistance. In some cases, it may be provided for free.
DISABILITY INSURANCE
What is disability insurance?
It is insurance that replaces part of the income you earn from your job if a sickness or accident prevents you from working, temporarily or permanently.
Can I get any income when I'm disabled from work if I don't have insurance?
Maybe. If you live in New York, New Jersey, Rhode Island, California, Hawaii or Puerto Rico, you are most likely eligible to receive up to a year of disability income covering a substantial portion of your wages.
What kind of disability insurance is available?
Group (through your employer or otherwise) or private insurance. Sales of disability insurance are reportedly growing again after several years of decline. Affordable, or sometimes free, insurance may be offered through your employment. People often don't realize that such coverage is part of their employee benefits, so be sure to ask. Even if you have to pay part or all of the premium, which is usually relatively small, it is well worth it if you ever need the income replacement. And if you pay the premiums, any benefits will be tax-free. You should also check to see if the insurance can be taken with you if you leave your employment.
If you can afford private disability insurance coverage (it's expensive), find a reputable company; an insurance agent can provide you with ratings. Find out exactly what conditions of disability are covered and how much of your prior income you will receive, and for how long.
If I have disability insurance and become unable to work, might I have problems getting my benefits? Once benefits begin, can they be terminated?
Yes to both. The July/August 2005 issue of inMotion and the 2005 edition of First Step both contain comprehensive articles explaining disability insurance and the best way to get benefits and avoid problems that could result in a denial of coverage.
The most important development in disability insurance occurred in late 2005, when the California Department of Insurance took steps to stop a number of wrongful practices that were being used by a large insurance company to avoid paying benefits. California implemented steps to stop such practices by all insurance companies licensed in the state. Other states are likely to follow.
Insurance companies (at least those writing policies in California) are now required to:
- Pay more attention to the opinions of your treating physicians as to whether you can work
- Cease the constant barrage of requests for information, once disability has been established
- Stop “cherry picking” selective portions of medical data and reports to justify denials
- Use a more fair and uniform definition of “ total disability”
- Stop using the argument that the discretionary authority granted to them under a policy allows them to rule as they want, with impunity, on a claim.
GENERAL MATTERS
If I file my insurance claim “late,” can I still get benefits?
In most cases, yes. “Late” means past the deadline set forth in the insurance contract for filing a claim (usually a few months from the disability). However, the general rule in many states is that as long as the insurance company has not been harmed because of the late filing, your claim should be processed. For example, if the insurer has lost its right to make a claim against a third party related to your claim because of the late filing, you will normally be barred if the claim is late. Otherwise, you're probably OK, but how late the claim was filed, your ability to have filed within a reasonable time, and your knowledge that you had coverage may play a part in any decision.
Do I need someone to help me with an appeal of a coverage denial or termination?
It is recommended. Usually, you can file an initial health or disability claim yourself with help from your treating physician (of course, if you are too sick to do so, you may need outside help). If your claim is denied or terminated, your rights are limited, so you would be wise to get help either from a patient advocate or an attorney. Make sure that the person will not charge you anything unless your appeal is granted.
Where do I look for assistance in filing an appeal?
Check with the ACA, do a computer search, or contact a legal aid society or bar association in the county or state where you live.
The rules and regulations governing insurance differ state by state. Therefore, you should always call the insurance department in the state where you live for help with your insurance problems.
Copyright 2007 Gerald B. Kagan.
About the Author
Gerald B. Kagan, JD, is a patient advocate who assists those who are having significant problems with the medical system. You may contact him by e-mail at gbkagan@aol.com or call 310/230-8333.
