Approved, then denied

This is one of the most frustrating denials: your plan said yes, you had the care, and the claim came back denied. Start by finding out which of three things happened. The approval did not match the claim. The approval was withdrawn or ran out. Or your coverage changed between the approval and the care. Each one has a different fix.

What this means

A prior authorization is an approval of a specific service, by a specific provider, for specific dates. A claim that differs in any of those can be denied even though “the plan approved it”. A phone call that said a service was “covered” is weaker than a written approval, and many plans say an approval is not a guarantee of payment.

Some protections do exist:

• Medicare Advantage. Once a plan approves a service through prior authorization, a pre-service decision or a decision made during a stay, it may not later deny coverage for lack of medical necessity. It may reopen the approval only for good cause or reliable evidence of fraud or similar fault. An approval for a course of treatment must stay valid for as long as medically necessary to avoid disruptions in care.
• Employer and Marketplace plans. We found no federal rule that bars a plan from denying a claim after approving it. Your protection comes from the plan’s own documents, from the proof you have, and sometimes from state law. For example, Alaska, Delaware and Utah list state rules that limit going back on an approval for insured plans. These state rules do not reach self-funded employer plans.
• A plan that cuts short care it approved. For an approved course of treatment, ending it early counts as a denial. A non-grandfathered plan must give you notice early enough to appeal and get a decision before the benefit is reduced or ended.

What to do

1. Find your proof of approval. Look for the approval letter, the portal record, or your call log. You need the date, the reference number, what was approved, which provider and which dates. (You, with your doctor’s office.)
2. Compare the approval with the claim. Check provider name, facility, dates, procedure codes and place of service. A different hospital, a different code or a service done after the approved dates is a common cause. (You and the provider’s billing office.)
3. If they differ, ask the provider to correct or re-request. The billing office may be able to resubmit the claim with the right codes or ask the plan to update the authorization. This is often faster than an appeal. (The provider.)
4. If they match, file an appeal and attach the approval. Use the letter for an approval that was later denied. State the approval reference number and date in the first paragraph. (You.)
5. Ask for the plan’s claim file. The file should show what the plan relied on for the denial. (You.)
6. Check your coverage dates. If your coverage ended or was cancelled after the approval, the denial is about eligibility, not the approval. See the guides below. (You.)
7. Keep the deadline. Employer and non-grandfathered individual plans must give you at least 180 days after you receive the denial notice to appeal. Check the date on your notice, which controls.

What the plan may say, and what to say back

“Prior authorization is not a guarantee of payment.” Ask which plan term allows the denial, and ask the plan to point to what changed between the approval and the claim. If your plan is a Medicare Advantage plan, ask which good cause or evidence of fraud or similar fault it relies on.

“The approval was for a different procedure code.” Ask your doctor’s office whether the code on the claim matches the service you had. If the service was the one approved, ask the plan for the code the approval used and ask the billing office to correct the claim.

The rule

Once a Medicare Advantage plan approves a service through prior authorization, a pre-service decision, or a decision made during an inpatient or outpatient stay, it may not later deny coverage for lack of medical necessity and may reopen the approval only for good cause or reliable evidence of fraud or similar fault. 42 Code of Federal Regulations (CFR) 422.138

Watch for

• Medicare Advantage only. The rule above applies to Medicare Advantage plans. Do not assume it applies to employer, Marketplace or Original Medicare coverage.
• Eligibility denials. If the denial says you were not covered on the date of service, that is an eligibility finding. Federal external review does not cover eligibility denials.
• Verbal approvals. If someone told you by phone that care was covered, ask for it in writing and note the name, date and time.
• The bill. While you appeal, ask the provider to hold the bill. See the bill while you appeal and the bill hold request letter.

What next

• Prior authorization denied: if the first request was refused.
• Timely filing and eligibility denials: when the problem is your coverage dates.
• When coverage is cancelled retroactively: what the rescission rules allow.
• File an internal appeal: the steps for the first appeal.