Health Insurance Claims


What is a health insurance claim? Simply put, a claim is a medical bill that your health care provider (doctor, specialist, hospital, etc.) sends to your health insurer to be paid. If you go to your doctor for a regular office visit and end up having an exam run, the doctor submits a bill to your insurance company for the cost of services. When the insurance company receives the claim, they examine the charges, pay for their portion, and inform the doctor of how much you owe. A co-payment must also be paid upon receiving services, separate from the claim.

How Claims Work

It is important to know the various parts of the claims process, so you can understand how the amount you will have to pay is reached. Keep in mind, every health insurance company has a different method of processing claims, though the same concept remains true for all claims. The process is not difficult, but you should know how it works, as it is not a direct charge. In order, the following steps are a guide to how a claim is fulfilled:

  1. An individual with insurance goes to see a provider of medical care. Providers can be a therapist, doctor, hospital, pharmacist, laboratory, surgeon, or any other type of health care facility or specialist.
  2. The provider uses a health insurance claim form to bill the individual’s insurance company. Most forms are electronic for efficiency purposes, with codes for every service and diagnosis.
  3. The insurance company receives the claim. All claims are dated and include the code of the services rendered to deliver the information accurately and provide the payment on time.
  4. The insurer reviews the expenses to make sure they qualify for benefits under the individual’s particular health plan. They then decide on the amount to charge the policy-holder based on the type of plan they have.
  5. The insurer issues an electronic Explanation Of Benefits (EOB) and a check (if necessary).
  6. The provider charges the patient a balance calculated by the EOB.


Claim Denial

At times claims can cause difficulty, usually when a patient feels they are being overcharged or when a claim is denied. To avoid a claim denial, make sure you have read the fine print of your policy. Know what your plan covers and what it does not so you can find out what services will be covered by insurance before you pursue treatment. Make note of the services that require approval from your insurance company, and always get approved before going in to receive care.

Inform your doctor of what your plan covers, so they are aware of the need to get approval before receiving any qualifying service. It is likely that your doctor is not aware of the specifics of your particular health insurance policy. Letting him or her know what the services that require prior approval can save lots of time in the claims process, and most importantly avoid being denied.

If your plan is either an HMO or PPO, it is essential to know how your plan operates when it comes to networks. If you have an HMO, no coverage will be available to you for out-0f-network services, with the exception of a procedure that the network does not offer. These services will have to be pre-approved by your health insurer before you proceed with any care. If you have a PPO, you will be able to see an out-of-network provider without prior approval or referral. You will be expected to pay most of the cost out-of-pocket on a PPO.

Your Claim is Denied, What Happens Now?

When a claim has been denied, it is best to thoroughly look over your file, and contact customer service at your health insurance company. Always take detailed notes of the date and time, names of the people you spoke with, and the content of the conversation. If your denial was a mistake, it can usually be resolved through speaking with your insurance company. Otherwise, you may need to take the next step, and write a formal appeal.

The paperwork you need to file for an appeal will be outlined in your health insurance plan, which will include copies of bills, the name and contact information of the provider you used, and the referral statement from your doctor (explaining why you had to receive the care). You can expect your health policy to have multiple steps in making an appeal. If your first appeal is denied, you should be able to make another appeal. Your health insurance company’s benefits booklet usually outlines their specific criteria for the appeal process.